Turn to the estimated coefficients; Table 1 presents the estimated results of the effect of sectoral foreign aid on income inequality in recipient countries. The results indicated that aid to economic sector exhibit a negative and
significant impact on income inequality at 1 percent significant level. Meaning that aid to economic sector is
effective in reducing income inequality in aid recipient countries. Moreover, aid to multi sector indicated a
positive and significant at 5 percent level impact on income inequality. This result shows that aid to this sector
seems to increase income inequality. Even though aid to social sector and production sector do not appear to
exert any statistically significant effect on income inequality, but they affected income inequality by the opposite
direction. Aid to social sector has a negative correlation to income inequality and aid to production is positively
correlated to income inequality. Then GDP and employment attempted to have negative and significant at 5
percent level and positive impact at 5 percent significant level on income inequality, respectively. The inflation
rate has a negative significant impact on income inequality, while trade openness was not significant in affecting
income inequality.