The Relationships between Income Inequality & Savings: A Study on Households in Turkey
Abstract
This study aims to investigate the relationship between income inequality and households in the Turkish economy. The issue of income inequality has gained increasing interest throughout the world in recent years. It is thought that the increasing importance of income inequality may be related to the economic growth performance of countries. It is observed that income inequality is high in the countries, which has a fluctuating trend of economic growth. Income inequality can affect economic growth through savings. Some of the savings in economies belong to households. Depending on the relationship between income levels and the marginal propensity of savings of households, economic growth performances of countries may vary. Therefore, income inequality is an important macroeconomic indicator for both developed and underdeveloped countries. In this study, the relationship between income inequality and savings for households in Turkey is analyzed with ARDL bound testing methodology. The findings of this study show that there is a long-term relationship between income inequality and savings.
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References
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