This paper evaluates the contribution of inequality of opportunity to inequality in earnings in Egypt and analyzes its evolution across four age cohorts and over three periods of time. On average, inequality of opportunity is found to account for 30 percent of total earnings inequality. The results reveal important variations of the inequality of opportunity indicators across age cohorts and over time. There is evidence that an important part of earnings inequality in the age cohort between 40 and 49 years old is due to unequal access to opportunities. The findings indicate that despite a small increase in total earnings inequality over time, the share of inequality of opportunities is decreasing. A sharp decline is observed in 2006.
In addition to demands for more economic and political inclusion, the “revolution” in the MENA region had been sparked by a refusal to any longer tolerate the gross socio-economic inequality perpetuated by long-entrenched “elite” in power. Thus, in many countries today, the issue of inequality has come to the front burner of international and national discourse with a view to finding solutions. Therefore, in addition to equity reasons, there are good economic and political reasons to be concerned about inequality and its various dimensions. This brief contributes to this debate along several dimensions.
This report provides a review of empirical knowledge about income inequality in the Arab region, focusing primarily on the issues of data and measurement, and the characterization of its patterns and trends. It does not go much into policy analysis and the understanding of the causes and determinants of inequality. The review shows good progress […]
This article aims at testing the effects of institutional characteristics on growth in the MENA (Middle East and North Africa) countries. The study explains the conditional convergence in terms of initial conditions, macroeconomic performance, trade openness, government size, natural resource abundance and institutional and political structures for a sample of 90 countries over the period 1960-2000. We use regional indicators and MENA-specific variables in order to test for the effects of each variable on the growth performance of the MENA economies. The study highlights the direct and indirect impacts of both corruption and bureaucratic quality on the MENA growth compared to the other regions of the world
This paper develops a microsimulation analysis to evaluate the impact of trade liberalization policies in Egypt on income redistribution. The analysis aims at identifying the effects of those measures on redistribution aspects. The paper relies on a macro – micro approach integrating results obtained from a discrete choice model of labor supply in a Computable General Equilibrium model (CGE).
The study looks at study the poverty-economic growth nexus in Kenya using the Ravallion-Datt-Shapley approach to decompose changes in poverty into growth and redistribution components; and link institutional factors to poverty and inequality. Pro-poor growth indices and growth incidence curves are used to assess whether economic growth between 1994 and 2006 was pro-poor. The study finds that find that changes in mean income, rather than redistribution accounted for the largest variation in poverty; and establish that economic growth in Kenya is not always accompanied by poverty reduction. In particular, growth was pro-poor over 1997–2006 but less so over 1994–1997; and there are instances where growth seems to have been pro-rich. Furthermore, we find that access to fuel, water, and educational attainment have the largest positive impacts on levels and growth in well-being and are key drivers of inequality. Institutional endowment as well as access to institutional services has important implications for pro-poor growth in Kenya.
This paper decomposes changes in total income inequality into structural, pure inequality and interactive effects. An attempt is made to determine the contribution of different income sources to overall income inequality, and change in their relative importance over four periods─1997, 2000, 2004 and 2007. The Gini index is used as the measure of inequality. The results reveal that although overall income inequality in rural Kenya decreased substantially, the magnitude and sign of inequality change varied between periods and across agro-ecological zones. The overall decline was due to reduction in pure inequality effects associated with crop income and formal wages. However, there was a change in direction of income change after 1997-2000 period. During 2000-2007, structural effects largely contributed to the declining trend in income inequality. The driving force underlying the observed decline was change in crop income inequality
Although Tanzania experienced relatively rapid growth in per capita GDP in the 1995-2001 period, household budget survey (HBS) data shows only a modest and statistically insignificant decline in poverty between 1992 and 2001. To assess the likely trajectory of poverty rates over the course of the period, changes in poverty are simulated using unit-record HBS data and national accounts growth rates under varying assumptions for growth rates and inequality changes. To this end the projection approach of Datt and Walker (2002) is used along with an extension that is better suited to taking into account distributional changes observed between the two household surveys. The simulations suggest that following increases in poverty during the economic slowdown of the early 1990s, recent growth in Tanzania has brought a decline in poverty, particularly in urban areas. Unless recent growth is sustained, the country will not meet its 2015 Millennium Development Goal (MDG). Poverty reduction is on track in urban areas, but reaching the MDG target for bringing down poverty in rural areas, where most Tanzanians live, requires sustaining high growth in rural output per capita.
This chapter surveys the link between governance and inequalities, tracing the evolution of the Kenyan state and its institutions, and assesses how post-independence politics gave rise to inequities. The ethnic composition of Cabinets is assessed over different regimes and political epochs. The author notes that the need to take care of regional interests, and the number of the large ethnic groups, has informed political governance in Kenya and greatly informed the logic and character of forming governments
This study seeks to highlight the level of income inequality in Kenya and its implications on various poverty reduction policies. The 2003 Kenya SAM is used to develop a multiplier simulation model which tracks the linkages among demand-driven shocks and economic growth, income generation, and income distribution for different economic groups. In the first section of our multiplier analysis, we determine the major sectors that can be used to promote generalized economic development in Kenya. The trade, hospitality (hotels and restaurants), manufacturing, and agricultural sectors play the highest role in the development of Kenya’s domestic economy.