Income inequality and the oil resource curse
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arXiv
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| Natura: | Preprint |
| Pubblicazione: |
2024
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| _version_ | 1866910290140987392 |
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| author | Parcero, Osiris Jorge Papyrakis, Elissaios |
| author_facet | Parcero, Osiris Jorge Papyrakis, Elissaios |
| contents | Surprisingly, there has been little research conducted about the cross-country relationship between oil dependence/abundance and income inequality. At the same time, there is some tentative evidence suggesting that oil rich nations tend to under-report data on income inequality, which can potentially influence the estimated empirical relationships between oil richness and income inequality. In this paper we contribute to the literature in a twofold manner. First, we explore in depth the empirical relationship between oil and income inequality by making use of the Standardized World Income Inequality Database; the most comprehensive dataset on income inequality providing comparable data for the broadest set of country-year observations. Second, this is the first study to our knowledge that adopts an empirical framework to examine whether oil rich nations tend to under-report data on income inequality and the possible implications thereof. We make use of Heckman selection models to validate the tendency of oil rich countries to under-report and correct for the bias that might arise as a result of this; we find that oil is associated with lower income inequality with the exception of the very oil-rich economies. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2401_04046 |
| institution | arXiv |
| publishDate | 2024 |
| record_format | arxiv |
| spellingShingle | Income inequality and the oil resource curse Parcero, Osiris Jorge Papyrakis, Elissaios General Economics Economics Surprisingly, there has been little research conducted about the cross-country relationship between oil dependence/abundance and income inequality. At the same time, there is some tentative evidence suggesting that oil rich nations tend to under-report data on income inequality, which can potentially influence the estimated empirical relationships between oil richness and income inequality. In this paper we contribute to the literature in a twofold manner. First, we explore in depth the empirical relationship between oil and income inequality by making use of the Standardized World Income Inequality Database; the most comprehensive dataset on income inequality providing comparable data for the broadest set of country-year observations. Second, this is the first study to our knowledge that adopts an empirical framework to examine whether oil rich nations tend to under-report data on income inequality and the possible implications thereof. We make use of Heckman selection models to validate the tendency of oil rich countries to under-report and correct for the bias that might arise as a result of this; we find that oil is associated with lower income inequality with the exception of the very oil-rich economies. |
| title | Income inequality and the oil resource curse |
| topic | General Economics Economics |
| url | https://arxiv.org/abs/2401.04046 |