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This paper provides novel evidence of nonlinearities in the formation of preferences for redistribution by uncovering evidence of multiple regimes consistent with the presence of multiple equilibria and multiple steady states. Using threshold regressions that account for the endogeneity of the threshold variable, countries are classified into three groups that share common characteristics. Finally, our analysis reveals substantial evidence of parameter heterogeneity in the coefficient estimates of threshold regressions. [ABSTRACT FROM AUTHOR]

This article investigates the relationship between inequality, redistribution, and the duration of growth spells in the presence of a rich set of alternative determinants, by explicitly accounting for model uncertainty using model averaging for duration models. We find that lower net inequality is associated with longer growth spells. Redistribution does not appear to be correlated with the duration of growth spells. In addition, there is no evidence of nonlinearities in the inequality–redistribution–growth spell relationship. Finally, lower initial income, higher secondary education, and higher FDI are associated with longer spell duration. [ABSTRACT FROM AUTHOR]

This paper estimates threshold regression models with an endogenous threshold variable using a nonparametric control function approach. Assuming diminishing threshold effects, we derive the consistency and limiting distribution of our proposed estimator constructed from the series approximation method for weakly dependent data. In addition, we propose a test for the endogeneity of the threshold variable, which is valid regardless of whether the threshold effects exist. We assess the performance of our methods using Monte Carlo simulations. [ABSTRACT FROM AUTHOR]

In this paper, we investigate the relationship between foreign aid and growth using recently developed sample splitting methods that allow us to simultaneously uncover evidence for the existence of heterogeneity and nonlinearity. We also address model uncertainty in the context of these methods. We find some evidence that aid may have heterogeneous effects on growth across two growth regimes defined by ethnolinguistic fractionalization. However, when we account for model uncertainty, we find no evidence to suggest that the relationship between aid and growth is nonlinear. In fact, our results suggest that the partial effect of aid on growth is likely to be weakly negative. In this sense, our findings suggest that aid is potentially counterproductive to growth with outcomes not meeting the expectations of donors. JEL classification: O49; C59 Keywords: Foreign aid; Economic growth; Nonlinearity