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Review of World Economics

, Volume 155, Issue 1, pp 71–104 | Cite as

Volatility widens inequality. Could aid and remittances help?

  • Lisa Chauvet
  • Marin Ferry
  • Patrick Guillaumont
  • Sylviane Guillaumont Jeanneney
  • Sampawende J.-A. Tapsoba
  • Laurent WagnerEmail author
Original Paper

Abstract

We analyse the relationship between income volatility and inequality and the conditional role played by aid and remittances. Using a panel of 142 countries for the period 1973–2012, we confirm a well-established finding among the literature that income volatility has an adverse impact on inequality, and that the poorest people are the most exposed to these fluctuations. However, while aid and remittances do not seem to have a clear direct impact on inequality, we uncover robust evidence that suggests that aid helps dampen the negative effects of volatility on the distribution of income, while remittances do not.

Keywords

Volatility Inequality Aid Remittances 

JEL Classification

F24 F35 O15 

Supplementary material

10290_2018_331_MOESM1_ESM.docx (188 kb)
Supplementary material 1 (DOCX 188 kb)

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Copyright information

© Kiel Institute 2018

Authors and Affiliations

  1. 1.IRD, LEDa, PSL, UMR DIAL, Université Paris DauphineParisFrance
  2. 2.FerdiClermont-Ferrand Cedex 1France
  3. 3.DIAL, LEDa, IRD, Université Paris-Dauphine, Université PSLParisFrance
  4. 4.Université Clermont AuvergneClermont-FerrandFrance
  5. 5.International Monetary FundWashington DCUSA

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