An Analysis of Effects of Economic Growth on Income Distribution in Countries of Middle East and North Africa Area

The growth rate is an economic development measurement that a higher level of this rate shows that the country goes toward the higher level of facilities and capacity in the economy. In another side income distribution, indicators describe an economy in different aspect and show that how facilities distribute among the people. Therefore, investigation of the relationship between the economic growth and income distribution indicators is very vital to set economic targets and strategies for countries. So, several theories address to the relationship. In this research, based on Lee et al. (2013), we analyze the relationship between economic growth and income distribution for the Meddle East and North Africa (MENA) countries during 1994-2014. In this regard, we use Spatial Durbin Model. The results show economic growth has a positive and significant effect on income distribution, while the square of economic growth rate has a negative and significant effect on income distribution, which indicates Kuznets's hypothesis is not rejected in the studied countries. Additionally, human capital has a positive and significant effect on income distribution. However, accumulation of population increases the inequality of income. Also, results of the spatial dependence test show that there are spatial relationships between the model variables.