JEFMS Journal

Google Scholar

Article Pdf

---

ABSTRACT:

This study examines the impact of covid 19 on income inequality and comparison between China and Italy. Trends in Gini coefficient showed differentiated results for two countries. In this comparison various indicators came to consideration that affected inequality. For empirical investigation from the past data collected from World Development Indicators and Generalized methods of moments (GMM) for panel data analysis. Results indicated that poverty and unemployment have significant positive impact on income inequality while rate of taxes shown negative and significant impact on income inequality. These results supported many other studies but the post covid trend in Gini coefficient shows contradictory results. Rising trend in income inequality in China and falling trend in Italy drives the attention in mitigation policies. China preferred to save its population from corona virus and implemented strict stay at home and isolation policy. In this regard inequality showed rising trend. Whereas Italian government along with isolation and stay at home policies financed poor much and paid less attention to rich. In this way the gap between rich and poor came down. This study pays attention to the country-based policies reflecting government preferences and initiatives taken for betterment.

KEYWORDS:

Income Inequality, Covid-19, Gini coefficient, lorenz curve, Italy and China

REFERENCES:

1) Ahir H, Bloom N, Furceri D. (2018). World Uncertainty Index. Mimeo, Stanford, CA: Stanford University (2018).

2) Barro RJ, Ursua JF, Weng J. (2020). The corona virus and the great influenza pandemic: lessons from the “Spanish Flu” for the corona virus's potential effects on mortality and economic activity. In: National Bureau of Economic Research (NBER) Working Paper, No. 26866. Cambridge, MA: NBER

3) Bakas D, Triantafyllou A.(2020) Commodity price volatility and the economic uncertainty of pandemics. Econ Lett. 193:109283 do10.1016/j.econ let.2020.109283

4) Brenner M.H., Bhugra D.(2020). Acceleration of anxiety, depression, and suicide: secondary effects of economic disruption related to COVID-19. Front Psychiatry. 2020;11

6) Brunori, P., Maitino, M.L., Ravag

li, L., Sciclone, N. (2020). Distant and unequal. Lockdown and inequalities in Italy. DISEI, Universita degli Studi di Firenze, Working Paper No. 13/2020 (2020)

7) Crayne M.P.(2020). The traumatic impact of job loss and job search in the aftermath of COVID-19. Psychol. Trauma.12:S180–S182.

8) Deaton, Angus (2021). COVID-19 and Global Income Inequality’, NBER Working Paper No. 28392, available at: http://www.nber.org/papers/w28392

9) Fang, H., Wang, L., Yang, Y (2019). Human mobility restrictions and the spread of the novel Coronavirus (2019- nCoV) in China. J. Public. Econ. 191, 104272 (2020).

10) Ferguson, N., Laydon, D., Nedjati Gilani, G., Imai, N., Ainslie, K., Baguelin, M., Bhatia, S., Boonyasiri, A., Perez, C., Cuomo-Dannenburg, Z., G. (2020). Impact of non-pharmaceutical interventions (NPIs) to reduce COVID-19 mortality and healthcare demand. Report published by the Imperial College COVID-19 Response Team (2020).

11) Furceri D, Loungani P, Ostry JD, Pizzuto P.(2020). Will Covid-19 affect inequality? Evidence from past pandemics. Covid Econ Vetted Real Time Pap. 12:138–57.

12) Galletta S, Giommoni T. (2020). The effect of the 1918 influenza pandemic on income inequality: evidence from Italy. Covid Econ Vetted Real Time Pap. (2020) 33:73–109. doi: 10.2139/ssrn.3634793

13) Gozgor G.(2021). Global evidence on the determinants of public trust in governments during the COVID-19. Appl Res Qual Life. . doi: 10.1007/s11482-020-09902-6.

14) International Labour Organization says ILO (2020). Almost 25 Million Jobs Could be Lost Worldwide as a Result of COVID-19.

15) International Monetary Fund Washington, DC, IMF (2020). World Economic Outlook: The Great Lockdown International Monetary Fund.

16) Jorda O, Singh SR, Taylor AM. (2020). Long-run Economic consequences of Pandemics. Covid Econ Vetted real time Pap.

17) Knapp M., Wong G. (2020). Economics and mental health: the current scenario.World Psychiatry. 19(1):3–14.

18) Ksinan Jiskrova G., Bobak M., Pikhart H., Ksinan A.J.(2021). Job loss and lower healthcare utilization due to COVID-19 among older adults across 27 European countries. J. Epidemiol. Community Health.

19) Laborde, D., Martin, W., Swinnen, J., & Vos, R. (2020). COVID-19 risks to global food security. Science, 369(6503), 500–502.

20) Layard, R., Clark, A., De Neve, J.-E., Krekel, C., Fancourt, D., Hey, N., O’Donnell, G.(2020). When to release the lockdown: A wellbeing framework for analyzing costs and benefits. Centre for Economic Performance, Occasional Paper No. 49 (2020).

21) Mahler, D., Lakner, C., Aguilar, C. R., & Wu, H. (2020). The impact of COVID-19 (Corona virus) on global poverty: Why Sub Saharan Africa might be the region hardest hit. World Bank Data

22) McKibbin, W., and Fernando, R. (2020). The global macroeconomic impacts of COVID-19: Seven scenarios. CAMA Working Paper 19/2020.

23) Milanovic B. (2016). Global Inequality: A New Approach for the Age of Globalization. Cambridge: Harvard University Press

24) Piketty T (2014). Capital in the twenty-first century. Harvard University Press. https://doi.org/10.1017/ CBO9781107415324.004

25) Piketty T, Saez E. (2003). Income Inequality in the United States, 1913-1998. Q J Econ. (2003) 118:1–41. doi: 10.1162/00335530360535135

26) Qiu Y, Chen X, Shi W.(2020). Impacts of social and economic factors on the transmission of coronavirus disease 2019 (COVID-19) in China. J Popul. Econ. 33:1127–72. doi: 10.1007/s00148-020-00778-2

27) Saltiel, Fernando. (2020). “Who Can Work From Home in Developing Countries?

28) Sayed A, Peng B. (2020). Pandemics and income inequality: a historical review. Covid Econ Vetted Real Time Pap. (2020) 52:96–117.

29) Solt F.(2020). Measuring income inequality across countries and over time: the standardized world income inequality database. Soc Sci Q. (2020) 101:1183–9. doi: 10.1111/ssqu.12795

30) Sumner, A., Hoy, C., & Ortiz-Juarez, E. (2020). Estimates of the impact of COVID-19 on global poverty. WIDER Working Paper 2020/43, UN WIDER.

31) Viinamaki H., Hintikka J., Kontula O., Niskanen L., Koskela K. (2000). Mental health at population level during an economic recession in Finland. Nordic J. Psychiatry. 2000;54:177–182.

32) World Bank.(2021) World Development Indicators Data set. Washington, DC: World Bank (2021).

33) Wu S.(2020). Effects of pandemics-related uncertainty on household consumption: evidence from the cross-country data. Front Public Health. (2020) 8:798. doi: 10.3389/fpubh.2020.615344

34) Xie Y, Zhou X. Income inequality in today’s China.(2014). Proc Natl Acad Sci USA. (2014) 111:6928–33. doi: 10.1073/pnas.1403158111