Sub-Saharan Africa in general and West Africa in particular are ranked as one of the most unequal regions of the world. This study aims at investigating the direct effect of inequality on economic growth and human development (HD). To assess this effect, we use three variables and rigorous estimation techniques. The indirect effect of inequality on the economic growth–HD nexus in West Africa is analyzed with a view to identifying ways of realigning the policies to bring down inequality in West African economies. For this, we compare different standpoints on how inequality affects this nexus. Then, we run fixed effect panel regression and random effect panel regression on various models to test the hypotheses. We find that the positive impact of inequality on HD and economic growth in the most developed economies of the region results from deliberate policies coupled with strong economic and socio-political foundation.
AcemogluDRobinsonJAVerdierT (2012) Can’t we all be more like Scandinavians? Asymmetric growth and institutions in an interdependent world. National Bureau of Economic Research. Available at: https://www.nber.org/papers/w18441
2.
Africa Human Development Report (AfHDR) (2016) Accelerating Gender Equality and Women’s Empowerment in Africa. New York: United Nations.
3.
AghionPEGarcia-PenalosaC (1999) Inequality and economic growth: the perspective of the new growth theories. Journal of Economic Literature37(4): 1615–1660.
4.
AlesinaAPerottiR (1996) Income distribution, political instability, and investment. European Economic Review40(6): 1203–1228.
5.
AlesinaARodrikD (1994) Distributive politics and economic growth. The Quarterly Journal of Economics109(2): 465–490.
6.
AlkireSFosterJ (2011) Understandings and misunderstandings of multidimensional poverty measurement. The Journal of Economic Inequality9: 289–314.
7.
AnandSRavallionM (1993) Human development in poor countries: on the role of private incomes and public services. Journal of Economic Perspectives7(1): 133–150.
8.
BarroRJ (2000) Inequality and growth in a panel of countries. Journal of Economic Growth5(1): 5–32.
9.
BergAOstryJDCharalambsGS, et al. (2018) Redistribution, inequality, and growth: new evidence. Journal of Economic Growth23(4): 259–305.
10.
BirdsallNRossDSabotR (1995) Inequality and growth reconsidered: lessons from East Asia. The World Bank Economic Review9: 477–508.
11.
BourguignonF (1981) Pareto superiority of unegalitarian equilibria in Stiglitz’ model of wealth distribution with convex saving function. Econometrica49(6): 1469–1475.
12.
Charles-CollJA (2013) The debate over the relationship between income inequality and economic growth: does inequality matter for growth?Research in Applied Economics5(2): 1–18.
13.
ChiuMMKhooL (2005) Effects of resources, inequality, and privilege bias on achievement: country, school, and student level analyses. American Educational Research Journal42(4): 575–603.
14.
CorniaGAAddisonTKiiskiS (2004) Income distribution changes and their impact in the post-second world war period. In: CorniaGA (ed.) Inequality, Growth and Poverty in an Era of Liberalization and Globalization. Oxford: Oxford University Press, pp. 26–54.
15.
Dabla-NorrisEKKochharNSuphaphiphatF, et al. (2015) Causes and consequences of income inequality: a global perspective. IMF Discussion Note SDN/15/13. Washington, DC: International Monetary Fund (IMF).
16.
De la CroixDANDDoepkeM (2003) Inequality and growth: why differential fertility matters. American Economic Review93(4): 1091–1113.
17.
ForbesKJ (2000) A reassessment of the relationship between inequality and growth. American Economic Review90: 869–897.
18.
FosterADRosenzweigMR (1995) Learning by doing and learning from others: human capital and technical change in agriculture. Journal of Political Economy103: 1176–1209.
19.
FosuAK (2002) Transforming economic growth to human development in Sub-Saharan Africa: the role of elite political instability. Oxford Development Studies30(1): 9–19.
20.
FosuAK (2017) Growth, inequality, and poverty reduction in developing countries: recent global evidence. Research in Economics71(2): 306–336.
21.
GutiérrezCTanakaR (2009) Inequality and education decisions in developing countries. The Journal of Economic Inequality7: 55–81.
22.
KouadioHKGakpaLL (2022) Do economic growth and institutional quality reduce poverty and inequality in West Africa?Journal of Policy Modeling44(1): 41–63.
23.
LeeWPRoemerJEP (1998) Income distribution, redistributive politics, and economic growth. Journal of Economic Growth3(3): 217–240.
24.
LeighAJencksCSmeedingTM (2011) Health and economic inequality. In: NolanBSalverdaWSmeedingTM (eds) The Oxford Handbook of Economic Inequality. Oxford: Oxford University Press, pp.384–406.
25.
LiHZouH-f (1998) Income inequality is not harmful for growth: theory and evidence. Review of Development Economics2(3): 318–334.
26.
MayerSE (2001) How did the increase in economic inequality between 1970 and 1990 affect children’s educational attainment?American Journal of Sociology107(1): 1–32.
27.
MeltzerARichardS (1981) A rational theory of the size of government. Journal of Political Economy89(5): 914–927.
28.
MilanovicB (2003) Is inequality in Africa really different? Working paper no. 3169. Washington, DC: World Bank.
29.
PerottiR (1996) Growth, income distribution, and democracy: what the data say. Journal of Economic Growth1(2): 39.
30.
SenA (2000) A decade of human development. Journal of Human Development1(1): 17–23.
31.
StraussJThomasD (1998) Nutrition, and economic development. Journal of Economic Literature36(2): 766–817.
32.
ThorbeckeECharumilindC (2002) Economic inequality and its socioeconomic impact. World Development30(9): 1477–1495.
33.
WagstaffAVan DoorslaerE (2000) Income inequality and health: what does the literature tell us?Annual Review of Public Health21: 543–567.
34.
WehrmeisterFCCheikhMFInácioCM, et al. (2020) Wealth-related inequalities in the coverage of reproductive, maternal, newborn and child health interventions in 36 countries in the African Region. Bulletin of the World Health Organization98(6): 394–405.
35.
WilkinsonRPickettK (2009) The Spirit Level: Why More Equal Societies Almost Always Do Better. London: Penguin Books.
