The Influencing Factors of Income Inequality in Iran with Emphasis on the Role of Migration and Urbanization

The purpose of this article is to investigate the factors affecting the inequality of income distribution in Iran with emphasis on the role of migration and urbanization during the period 1695-1695. For this purpose, the data of the Time Series Database (Country Censuses, International Transparency Site) and the World Bank have been used. For this analysis, Vector Autoregressive Model, Johansson-Juselius method and Vector Error Correction Model have been employed. Regarding to results, the effect of the variables’ coefficients is coincident based on the theoretical foundations and statistically significant. Also the coefficient of the error correction method indicates that about 0.62 of the short-term imbalance is adjusted in each period to achieve the long-term equilibrium. Further, on the one hand, in the long run, one percentage increase in the GDP and literacy rates, respectively leads to 0.78 and 1.87 percentage decrease in the income inequality and on the other hand, a one percentage increase in the corruption, inflation, unemployment rate, urbanization rate and migration rate, leads to 2.3, 1.17, 1.53, 2.78, and 4.38 percentage increase in the income inequality, respectively.  Hence, from among the mentioned variables, the effect of migration rates on income inequality is greater than for other variables.