Income Inequality in the European Union and its Relationship with Economic Growth and Poverty

Authors

  • Chief Assist. Prof. Dr Monika Moraliyska–Ivanova Department of International Economic Relations and Business, Faculty of International Economics and Politics, UNWE Author

Keywords:

Economic growth, Income inequality, Social exclusion, Poverty, European union
F22, F66, I31, I32, I38, J58

Abstract

The aim of the study is to examine two serious challenges facing the European Union – poverty and social exclusion, on the one hand, and income inequality, on the other. Tasks include: 1) analysis of income inequality indicators at EU level and as variations between Member States; 2) empirical testing of two hypotheses by analyzing the regression relationship between economic growth, poverty and inequality in the EU in the period 2010 – 2019; 3) analysis of key factors for income inequality in the EU. The thesis is that income inequality in the EU is a serious social and economic problem, which is positively affected by economic growth and redistribution. The hypotheses that are tested through the econometric analysis are: a) Positive economic growth in the EU leads to poverty reduction and b) Positive economic growth in the EU leads to reduction of inequality (in the period 2010 – 2019). The methodology includes: comparative analysis, regression analysis, induction and deduction, the Bourguignon method „Growth-inequality-poverty triangle“ (Bourguignon, 2004). Recommendations have been made. The obtained results show that: 1) there are significant variations in the social indicators of poverty and inequality in the EU member states; 2) There is a direct link between economic growth and poverty reduction and income inequality in the EU; 3) There are various factors for income inequality in the EU.

References

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Published

2021-07-19

Issue

Section

Articles

How to Cite

Moraliyska–Ivanova, M. (2021). Income Inequality in the European Union and its Relationship with Economic Growth and Poverty. Research Papers, 3, 57-94. https://yb.e-dnrs.org/index.php/rp/article/view/5275