Skip to main content

Research Repository

Advanced Search

Exploring the Relationship Between Inequality and Economic Growth

Ossai, Lucky; Bhattarai, Keshab


Lucky Ossai


The studies on the relationship between income inequality and economic growth attract a lot of interest, particularly in low-income countries like Nigeria. While some scholars posit that income inequality stimulates economic growth, others argue that it has a negative effect, and that it leads to a rise in the poverty level of a country. This study examines the empirical relationship between income inequality and economic growth in Nigeria by assessing whether an inverted U-shaped connection exists between the two variables, as predicted by the Kuznets hypothesis. This study employs the Autoregressive Distributed Lag (ARDL) model for this analysis, and the findings indicate an inverted U-shaped relationship in the short-run. The research further reveals that inflation and the real exchange rates exhibit a statistically significant and negative correlation with income inequality in the long-run. Likewise, evidence suggests that political stability has a statistically significant positive long-term correlation with income inequality while in the short-term, it seems to improve income inequality in Nigeria. Additionally, in the short run, the real exchange rates reveal a statistically significant association and exacerbates income inequality.


Ossai, L., & Bhattarai, K. (2024). Exploring the Relationship Between Inequality and Economic Growth. Journal of Development Economics and Finance, 5(1), 211-233.

Journal Article Type Article
Acceptance Date Jun 12, 2024
Online Publication Date Jun 27, 2024
Publication Date 2024
Deposit Date Jun 26, 2024
Publicly Available Date Jul 8, 2024
Journal Journal of Development Economics and Finance
Publisher ARF India
Peer Reviewed Peer Reviewed
Volume 5
Issue 1
Pages 211-233
Keywords Inequality; Economic growth; Gini coefficient; Kuznets curve
Public URL


Published article (437 Kb)

Copyright Statement
© ARF India. All Right Reserved

You might also like

Downloadable Citations