Volume 16, Issue 3 (2016)                   QJER 2016, 16(3): 29-46 | Back to browse issues page

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Rafat B, Jazizadeh E. The Effect of Financial Development on Income Distribution in Iranian Provinces. QJER 2016; 16 (3) :29-46
URL: http://ecor.modares.ac.ir/article-18-7249-en.html
1- Assistant Professor in Economics, Department of Economy, University of Isfahan
2- M.A in Economics, University of Isfahan
Abstract:   (8611 Views)
Distribution of income in society is so important that almost all economists consider it as one of the main aims and missions of the government. As credit constraints cause inequality in society, thus the development of financial intermediaries and financial markets in national level, which affects access of the low-income and poor individuals to credit and financial services, can influence significantly income redistribution in the country. This study aims to examine the relationship between financial development and inequality among the Iranian provinces. By using fixed effects panel data model, and applying Galor-Zeira theory, the relationship between financial development and income distribution is tested in Iran during 2000-2011. The results show that increasing proliferation of financial intermediaries has negative impact on Gini coefficient and results in more equitable income distribution across the provinces.
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Article Type: Research Paper | Subject: D31 - Personal Income, Wealth, and Their Distributions
Received: 2014/04/21 | Accepted: 2014/11/12 | Published: 2016/10/22

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