Abstract
The main purpose of this paper is investigating the dynamics of income inequality and
globalization with emphasis on laber market inequality in data covering 13 developed
countries over the period of 1995-2016. The paper uses Panel cointegration test and Fully
Modified Ordinary Least Squares method to determine the long run relationship between
Globalization, Inequality in income, FDI and income inequality indices. The results
suggest that globalization did increase the inequality of gross wages. In addition, both
trade openness and outward foreign direct investments had a positive effect on gross
income inequality, but inward FDI did not have an effect. On the other hand, when
looking at the effects of globalization on the net income inequality, results differed. An
increase in outward and inward FDI will decrease the net income inequality.
Technological progress, on the other hand, had only a significant positive effect on the
net income inequality. Moreover, results showed that an increase in globalization
increases the income redistribution by government.
References
- Aghion, P., Caroli, E., & Garcia-Penalosa, C. (1999). Inequality and economic growth: the perspective of the new growth theories.Journal of Economic literature, 37(4), 1615-1660. 2. Alvaredo, F., Atkinson, A. B., Piketty, T., & Saez, E. (2013). The top 1 percent in international and historical perspective. The Journal of Economic Perspectives, 27(3), 3-20. 3. Atkinson, A. B., & Piketty, T. (Eds.). (2007). Top incomes over the twentieth century: a contrast between continental european and english-speaking countries. OUP Oxford. 4. Baek, I., & Shi, Q. (2016). Impact of Economic Globalization on Income Inequality: Developed Economies vs Emerging Economies. Global Economy Journal, 16(1), 49- 61. 5. Barro, R. J., and X. Sala-i-Martin. (1997). Technological Diffusion, Convergence, and Growth. Journal of Economic Growth, 2 (1), 2–26. 6. Barro, R., & Sala-i-Martin, X. (1995). Technological Diffusion, Convergence and Growth (No. 1255). CEPR Discussion Papers. 7. Bergh, A; Nilsson, T (2010) Do liberalization and globalization increase income inequality? European Journal of Political Economy, 4(26), 488-505 8. Beyer, H., Rojas, P., & Vergara, R. (1999). Trade liberalization and wage inequality. Journal of Development Economics, 59(1), 103-123. 9. Bjørnstad, R., & Skjerpen, T. (2006). Trade and inequality in wages and unemployment. Economic modelling, 23(1), 20-44.
Abstract
References
- Aghion, P., Caroli, E., & Garcia-Penalosa, C. (1999). Inequality and economic growth: the perspective of the new growth theories.Journal of Economic literature, 37(4), 1615-1660. 2. Alvaredo, F., Atkinson, A. B., Piketty, T., & Saez, E. (2013). The top 1 percent in international and historical perspective. The Journal of Economic Perspectives, 27(3), 3-20. 3. Atkinson, A. B., & Piketty, T. (Eds.). (2007). Top incomes over the twentieth century: a contrast between continental european and english-speaking countries. OUP Oxford. 4. Baek, I., & Shi, Q. (2016). Impact of Economic Globalization on Income Inequality: Developed Economies vs Emerging Economies. Global Economy Journal, 16(1), 49- 61. 5. Barro, R. J., and X. Sala-i-Martin. (1997). Technological Diffusion, Convergence, and Growth. Journal of Economic Growth, 2 (1), 2–26. 6. Barro, R., & Sala-i-Martin, X. (1995). Technological Diffusion, Convergence and Growth (No. 1255). CEPR Discussion Papers. 7. Bergh, A; Nilsson, T (2010) Do liberalization and globalization increase income inequality? European Journal of Political Economy, 4(26), 488-505 8. Beyer, H., Rojas, P., & Vergara, R. (1999). Trade liberalization and wage inequality. Journal of Development Economics, 59(1), 103-123. 9. Bjørnstad, R., & Skjerpen, T. (2006). Trade and inequality in wages and unemployment. Economic modelling, 23(1), 20-44.
Details
| Journal Section | Makaleler |
|---|---|
| Authors | |
| Publication Date | December 26, 2017 |
| Submission Date | November 20, 2017 |
| Published in Issue | Year 2018 Volume: 5 Issue: 1 |