A Study on the Relationship between Higher Education Equity and Income Distribution Based on Co-Integration and Granger Causality Test

Abstract

Some studies have shown that higher education equity has a considerable impact on income distribution. Therefore, the relationship between higher education equity and income distribution has become a hot issue to discuss. In this context, the paper firstly reviews the theory on relationship between higher education equity and income distribution. And then, followed by the use of Co-integration analysis and Granger causality test, the paper makes an empirical study to verify the relationship, the results shows that a stable relationship exists between higher education equity and income distribution in a long-term, and higher education equity leads to the equity of income distribution while the equity of income distribution has no impact at all on higher education equity. Finally the paper puts forward some countermeasures and suggestion based on the empirical analysis. Keywords—higher education equity, income distribution, co-integration, Granger causality test, error correction model