Acta Univ. Agric. Silvic. Mendelianae Brun. 2020, 68(6), 987-994 | DOI: 10.11118/actaun202068060987

Inequality in the Income of the Population as a Determinant of the Country's Economic Growth

Tamara Kocurová, David Hampel
Department of Statistics and Operation Analysis, Faculty of Business and Economics, Mendel University in Brno, Zemědělská 1, 613 00 Brno, Czech Republic

In this article, there is explored the dependence of economic performance and economic growth on income inequality expressed by Gini coefficient and S80/S20 ratio. Analysis is based on data collected upon EU countries in years 2007, 2012 and 2017. Cluster analysis points out to heterogeneity of EU countries in observed characteristics and enables creation of three groups of countries: post-socialistic, southern and northern. Regression analysis, which takes into account groups of countries, was used to assess and illustrate the dependence. The results show that income inequality has a negative impact on the country's GDP per capita, and its impact on economic growth differs for particular groups of countries.

Keywords: income inequality, Gini coefficient, GDP, economic growth, EU countries, regression analysis, cluster analysis, S80/S20 ratio
Grants and funding:

This article was supported by the grant No. PEF/TP/2020002 of the Internal Grant Agency PEF MENDELU.

Received: July 22, 2020; Accepted: November 13, 2020; Published: December 17, 2020  Show citation

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Kocurová, T., & Hampel, D. (2020). Inequality in the Income of the Population as a Determinant of the Country's Economic Growth. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 68(6), 987-994. doi: 10.11118/actaun202068060987
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