ABSTRACT

This research is designed to comparatively analyze the determinant of income inequality among the private and public ' sectors in Abia State Nigeria. Specifically, it examined the trend of income, tax as well as investment in. both public and private sectors, the relationship of income inequality in both sectors and • the determinants of income inequality of the sectors 'PI-ICN and GTB,). Secondary data was collected and used for this study it involved mainly financial statements gotten from both. Chow test regression analysis was used to analyze the data collected from P1-ICN and GTB from 2000 - 2009 sub period. Results revealed that income for the public sector was higher than the private sector probably because of the encouraqeTnen.t the public sector receives from government such as lax rebate. Tax value in the private sector was higher than the public sector and the level of investment for the private sector was higher than public sector as a result of high degree of competition found among firms in the private sector. Therefore, when there is increase in economic growth, economic asset such as benefits gotten from international trade flows should be distributed evenly to both sectors to reduce the amount of income inequality inherent in. both sectors. Also government should create policies that should favor the private sectors just as it favors the public sector.