Openness,inequality and poverty: Endowments matter

Using tariffs as a measure of openness, this paper finds consistent evidence that the conditional effects of trade liberalization on inequality are correlated with relative factor endowments. Trade liberalization, measured by changes in tariff revenues, is associated with increases in inequality in countries well-endowed with highly skilled workers and capital or with workers that have very low education levels. Similar, although less robust, results are also obtained when decile data are used instead of the usual Gini coefficients. Taken together, the results are strongly supportive of the factor-proportions theory of trade and suggest that trade liberalization in poor countries where the share of the labor force with little education is high raises inequality. Simulation results also suggest that relatively small changes in inequality as measured by aggregate measures of inequality, like the Gini coefficient, are magnified when estimates are carried out using decile data.     

Trade,foreign direct investments (FDI) and income inequality: Empirical evidence from transition countries

The aim of the article is to verify whether trade and inward foreign direct investments (FDI) may affect income distribution in a sample of 17 Transition Countries (TCs) over the period 1990–2006. In line with most of the previous literature, FDI do not have significant effects on income inequalities, whereas trade, especially when occurs with developed countries, seems to be more relevant. Different results are found when we take into consideration the educational system which represents an important channel through which FDI and trade may affect inequality.     

The regional trade dynamics of Turkey: a panel data gravity model

This paper analyzes the Turkish export and import flows with regard to regional clusters (RCs) and bilateral trade costs (BTCs) by using a panel data gravity model. We study the role of RCs and BTCs in two complementary parts: in the first part, we use an unbalanced panel data for 180 countries over the period 1960–2012, compiled from the DOTS database. We extend these estimations by running the data at four different time intervals, each representing different economic or political regimes in Turkey. In the second part, we repeat the same exercise at sectoral level for 176 countries over the period 1994–2010, using the BACI database. Aggregate estimates show that the gravity model is very effective in explaining the export and import flows of Turkey and that all close-by regions, including EU27, have a significant impact on trade flows of Turkey. We also find that the EU Customs Union has a negative effect on Turkish exports and a positive effect on imports. Estimates at selected time intervals reinforce aggregate estimates and sectoral level analyses indicate that while some regions contribute positively in all or the majority of sectors, others contribute negatively or produce mixed results.     

Export diversification,specialisation and inequality: Evidence from Asian and Western countries

This paper examines the dynamic effect of globalization at the disaggregated level of sectoral export diversification and manufacturing specialization on income inequality using a panel data set of 52 Asian and Western countries from 1988 to 2014. The paper uses dynamic panel data models applying the System Generalized Method of Moments (GMM) estimations that provide more accurate and better results than those obtained with static panel data models. The results suggest that there is no statistically significant relationship between manufacturing specialization and inequality while sectoral export diversification has been the driving force of inequality. For sub-groups of countries, higher sectoral export diversification increases inequality and higher manufacturing specialization decreases inequality in high-income Asian countries and European Union (EU) member states. Moreover, the study finds insignificant effects in low-income Asian countries and Anglo-Saxon countries.     

Top income shares in OECD countries: The role of government ideology and globalisation

This paper investigates how government ideology and globalisation are associated with top income shares in 17 OECD countries over the period 1970 to 2014. We use top income shares of the World Wealth and Income Database (WID ). Globalisation is measured by the KOF index of globalisation. Static and dynamic panel model results show that the top income shares increased more under right wing governments than under left wing governments. The ideology‐induced effect was stronger when globalisation proceeded more rapidly. Globalisation was positively correlated with income shares of the upper‐middle class (P99–P90), but negatively with income shares of the rich (top 1%) in the overall sample. We show that the relationship differs between Anglo‐Saxon countries and other OECD countries. Globalisation was more pro‐rich in Anglo‐Saxon countries than in other OECD countries. Government ideology does not turn out to have a statistically significant effect on top income shares in Anglo‐Saxon countries after the 1980s, whereas ideology‐induced differences in the distributional outcomes continued in other OECD countries.     

The interplay of international trade,economic growth and income convergence: a brief intellectual history of recent developments

The literature on the interplay of international trade, economic growth, and income convergence across economies has proliferated in the past few decades. The present essay reviews the theoretical advancements and empirical findings in this literature. The focus will be on recent developments with a few glances at the past. The essay also describes new findings and insights into the role of international trade in global income distribution. Ideas for further research are offered throughout the essay.