This research gives a brief overview of Pakistan’s economic growth and income
inequality, and empirically assesses the relationship between these two variables of the
country over the period of 1990 – 2015. In the empirical part, our study employs the
augmented ADF test and simple regression analysis. ADF test results depict that both
variables of the model are stationary at the level and exhibit no unit root at the level.
Further, in regression results, the coefficient estimates are significant and reveal an
inverted U linkage between economic growth of the country and distribution of income.
The income level of the country alone explains a significant part of the income inequality.
Instead, the lagged dependent variable coefficient is significant and partly explains
variation in inequality.
1-Saleem Khan Assistant Professor, Department of Economics,Abdul Wali Khan University Mardan, KP, Pakistan.2-Salman Azad Khan MS Scholar,Department of Economics,Abdul Wali Khan University Mardan, KP, Pakistan.3-Muhammad Tariq Assistant Professor,Department of Economics, Abdul Wali Khan University Mardan, KP, Pakistan.
Economic Growth, Income Inequality, ADF Test, Regression Analysis