Using panel data we investigate the relationship between income inequality and economic development. We employ a threshold regression model that allows for endogenous income thresholds and find strong evidence of a two-regime split in our sample.

The pollution-convergence hypothesis is formalized in a neoclassical growth model with optimal emissions reduction: pollution growth rates are positively correlated with output growth (scale effect) but negatively correlated with emission levels (defensive effect). This dynamic law is...