Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/284840 
Year of Publication: 
2021
Citation: 
[Journal:] Economic Inquiry [ISSN:] 1465-7295 [Volume:] 60 [Issue:] 1 [Year:] 2021 [Pages:] 202-223
Publisher: 
Wiley, Hoboken, NJ
Abstract: 
We examine how trade openness influences income inequality within countries. The sample includes 139 countries over the period 1970–2014. We employ predicted openness as instrument to deal with the endogeneity of trade openness. The effect of trade openness on income inequality differs across countries. Trade openness tends to disproportionately benefit the relative income shares of the very poor, but not necessarily all poor, in emerging and developing economies. In most advanced economies, trade openness increased income inequality, an effect that is driven by outliers. Our results suggest a strong effect of trade openness on inequality in China and transition countries.
Subjects: 
development levels
globalization
income inequality
instrumental variable estimation
panel econometrics
trade openness
transition economies
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Article
Document Version: 
Published Version

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