THE RELATIONSHIPS OF INSTITUTIONAL QUALITY, ECONOMIC FREEDOMS AND INCOME DISTRIBUTION: A CASE OF THE MINT COUNTRIES

After 1980s, developments in many areas, especially in information technologies, have accelerated the increase in globalization, economic freedom and institutional quality. These increasing trends have important effects on basic economic variables such as economic growth, inflation and income distribution. These effects differ from country to country and there are debates about the direction of the effects. There has been no consensus among researchers on the impact of the increase in globalization, economic freedoms, and institutional quality on income distribution. Nevertheless, if globalization, economic freedom, institutional quality, openness and democracy levels increase in many countries, at the beginning income inequality increase, but later income inequality decrease after economic development. In this study; the effects of institutional quality, economic freedoms, globalization, openness, democracy and foreign direct investments on income inequality between 2000 and 2012 were analyzed for the MINT countries using panel data analysis. The obtained results demonstrated that the increase in the nations’ commercial, economic, political and social integration with the outside world, improvements in the nations’ organizational structures and degree of economic freedom diminish income inequality, whereas the rise in the level of democracy and foreign direct investments increases income inequality