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.
Keywords : Economic Growth, Income Inequality, ADF Test, Regression Analysis
Authored by :
(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.
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