The Analysis of Kuznets – Ahluvalia Hypothesis in Rural Areas of Iran

Subject Areas : Labor and Demographic Economics

Received: 2015-04-27 Accepted : 2015-04-27 Published : 2009-04-01

Keywords: Rural Education, Agricultural Research, Kuznets Hypothesis, TFP,

Abstract :

Today in development economics literature there is relation between growth and distribution of income (Fan, 2007). The main objective of this study is to investigate the effects of public investments such as agricultural R&D, infrastructure, education and Irrigation on income inequality in rural areas of Iran. However this research attempts to investigate the direction of causality between the income inequality and total factor productivity (TFP) in Iran. Using ARDL methods and period from 1980 to 2008, empirical results show there is inverse U shape relationship between income inequality and agricultural TFP in rural areas of Iran ( Kuznets hypothesis ) .                                                                                                                  Hence , additional investments in rural education and agricultural R&D have significant and different impacts on income inequality .findings showed that Kuznets hypothesis developed for relation among income inequality , TFP and openness of economic are supported in case of Iran rural areas .                                                                                                                       

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