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POLITICAL ECONOMY ASPECTS OF INCOME (RE-)DISTRIBUTION FINANCE AND INCOME INEQUALITY: A REVIEW AND NEW EVIDENCE CESifo, a Munich-based, globe-spanning economic research and policy advice institution Finance and income inequality: A review and new evidence

Jan-Egbert Sturm, Jakob De Haan, Jan-Egbert Sturm, Jakob De Haan, Jan-Egbert Sturm
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Using a panel fixed effects model for a large sample of countries, we examine how financial development, financial liberalization and banking crises are related to income inequality. In contrast with most previous work, our results suggest that all finance variables increase income inequality. The level of financial development conditions the impact of financial liberalization on inequality. Also the quality of political institutions conditions the impact of financial liberalization on income
more » ... equality, in contrast to the quality of economic institutions. Our main findings are robust for using random effects, crosscountry regressions and legal origin as instrument for financial development.
fatcat:ugycytkwz5dgbac3c52paly4ku
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Jan-Egbert Sturm, Jakob De Haan, Jan-Egbert Sturm, Jakob De Haan, Jan-Egbert Sturm. "POLITICAL ECONOMY ASPECTS OF INCOME (RE-)DISTRIBUTION FINANCE AND INCOME INEQUALITY: A REVIEW AND NEW EVIDENCE CESifo, a Munich-based, globe-spanning economic research and policy advice institution Finance and income inequality: A review and new evidence."