Impact of corruption and unemployment shocks on income inequality in Sub-Saharan Africa: A quantile-on-quantile approach

Abstract

Abstract This paper examines the impact of corruption and unemployment on income inequality in Sub-Saharan Africa (SSA). We employ the quantile-on-quantile technique which allows examining the impact of quantiles of the independent variable on quantiles of the dependent variable of the distribution. The outcome shows that countries at the upper range of the GDP per capita such as Botswana, Seychelles, and Mauritius had fewer negative supply shocks from corruption and unemployment which is associated with higher income equality. For countries in the middle range such as Nigeria, Kenya and Angola, corruption supplies extreme negative shocks to inequality in Nigeria and Angola. However, Kenya experienced a mixed shock but the negative is more evident. Unemployment provided a negative shock to unequal income distribution for almost all quantiles in the middle range income countries. Considering countries at the lower range such as Burundi, Central African Republic (CAR) and Niger. Corruption supplies a mixed shock on income inequality for almost all the quantiles in Niger and Burundi but supplies a positive shock on inequality in CAR. The shocks supply from unemployment to inequality is positive in Burundi and Niger except for CAR which exhibits a mixed shock.