Can We Discern the Effect of Globalization on Income Distribution? Evidence from Household Budget Surveys
The effects of globalization on income distribution in rich and poor countries are a matter of controversy. While international trade theory in its most abstract formulation implies that increased trade and foreign investment should make income dis...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2002/08/1993713/can-discern-effect-globalization-income-distribution-evidence-household-budget-surveys http://hdl.handle.net/10986/19276 |
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okr-10986-192762021-04-23T14:03:42Z Can We Discern the Effect of Globalization on Income Distribution? Evidence from Household Budget Surveys Milanovic, Branko ADVANCED COUNTRIES AGRICULTURE AVERAGE INCOMES AVERAGE SHARE BENCHMARK COMPARATIVE ADVANTAGE COMPETITIVENESS DECREASING INEQUALITY DEMOCRACY DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DEVELOPED COUNTRIES DEVELOPED ECONOMIES DIRECT INVESTMENT DISTRIBUTION DATA EDUCATIONAL ATTAINMENT EMPLOYMENT EQUALIZING EFFECT EXPENDITURES EXPORTS FINANCIAL DEPTH FINANCIAL MARKETS FOREIGN COMPETITION FOREIGN INVESTORS GDP GINI COEFFICIENT GROWTH RATES HOUSEHOLD SURVEY DATA HOUSEHOLD SURVEYS IMPORTS INCOME INCOME DIFFERENTIALS INCOME DISTRIBUTION INCOME GROUPS INCOME GROWTH INCOME INEQUALITY INCOME LEVEL INCOME LEVELS INCOME SHARE INCOME SHARES INCOMES INCREASED INEQUALITY INCREASING SHARE INEQUALITY INEQUALITY INDEX INEQUALITY MEASURE INTEREST RATE INTERNATIONAL EXCHANGE INTERNATIONAL TRADE LDCS LESS DEVELOPED COUNTRIES LOW INCOME M2 MARKET LIBERALIZATION MEAN INCOME MEAN INCOMES MEDIAN VOTER MEDIAN VOTER HYPOTHESIS MIDDLE CLASS NEGATIVE EFFECT NEGATIVE IMPACT PARLIAMENT PER CAPITA GROWTH PER CAPITA INCOME POLICY RESEARCH POLITICAL INSTITUTIONS POLITICAL SCIENTISTS POOR COUNTRIES POOR GROUPS POSITIVE EFFECT POSITIVE IMPACT PURCHASING POWER REAL INTEREST RATE REGIONAL AVERAGES REGIONAL DUMMIES RELATIVE DEMAND RELATIVE INCOME RELATIVE INCOMES RELATIVE SUPPLY RELATIVE WAGES SKILLED WORKERS THEORETICAL MODELS TRADE REFORMS TRANSITION ECONOMIES WAGE INEQUALITY INCOME DISTRIBUTION GLOBALIZATION FOREIGN INVESTMENTS INCOME INEQUALITIES HOUSEHOLD DATA FOREIGN DIRECT INVESTMENTS OPEN ECONOMIES The effects of globalization on income distribution in rich and poor countries are a matter of controversy. While international trade theory in its most abstract formulation implies that increased trade and foreign investment should make income distribution more equal in poor countries and less equal in rich countries, finding these effects has proved elusive. The author presents another attempt to discern the effects of globalization by using data from household budget surveys and looking at the impact of openness and foreign direct investment on relative income shares of low and high deciles. The author finds some evidence that at very low average income levels, it is the rich who benefit from openness. As income levels rise to those of countries such as Chile, Colombia, or Czech Republic, for example, the situation changes, and it is the relative income of the poor and the middle class that rises compared with the rich. It seems that openness makes income distribution worse before making it better--or differently in that the effect of openness on a country's income distribution depends on the country's initial income level. 2014-08-11T15:32:34Z 2014-08-11T15:32:34Z 2002-08 http://documents.worldbank.org/curated/en/2002/08/1993713/can-discern-effect-globalization-income-distribution-evidence-household-budget-surveys http://hdl.handle.net/10986/19276 English en_US Policy Research Working Paper;No. 2876 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research |
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Digital Repository |
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Foreign Institution |
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Digital Repositories |
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World Bank Open Knowledge Repository |
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World Bank |
| language |
English en_US |
| topic |
ADVANCED COUNTRIES AGRICULTURE AVERAGE INCOMES AVERAGE SHARE BENCHMARK COMPARATIVE ADVANTAGE COMPETITIVENESS DECREASING INEQUALITY DEMOCRACY DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DEVELOPED COUNTRIES DEVELOPED ECONOMIES DIRECT INVESTMENT DISTRIBUTION DATA EDUCATIONAL ATTAINMENT EMPLOYMENT EQUALIZING EFFECT EXPENDITURES EXPORTS FINANCIAL DEPTH FINANCIAL MARKETS FOREIGN COMPETITION FOREIGN INVESTORS GDP GINI COEFFICIENT GROWTH RATES HOUSEHOLD SURVEY DATA HOUSEHOLD SURVEYS IMPORTS INCOME INCOME DIFFERENTIALS INCOME DISTRIBUTION INCOME GROUPS INCOME GROWTH INCOME INEQUALITY INCOME LEVEL INCOME LEVELS INCOME SHARE INCOME SHARES INCOMES INCREASED INEQUALITY INCREASING SHARE INEQUALITY INEQUALITY INDEX INEQUALITY MEASURE INTEREST RATE INTERNATIONAL EXCHANGE INTERNATIONAL TRADE LDCS LESS DEVELOPED COUNTRIES LOW INCOME M2 MARKET LIBERALIZATION MEAN INCOME MEAN INCOMES MEDIAN VOTER MEDIAN VOTER HYPOTHESIS MIDDLE CLASS NEGATIVE EFFECT NEGATIVE IMPACT PARLIAMENT PER CAPITA GROWTH PER CAPITA INCOME POLICY RESEARCH POLITICAL INSTITUTIONS POLITICAL SCIENTISTS POOR COUNTRIES POOR GROUPS POSITIVE EFFECT POSITIVE IMPACT PURCHASING POWER REAL INTEREST RATE REGIONAL AVERAGES REGIONAL DUMMIES RELATIVE DEMAND RELATIVE INCOME RELATIVE INCOMES RELATIVE SUPPLY RELATIVE WAGES SKILLED WORKERS THEORETICAL MODELS TRADE REFORMS TRANSITION ECONOMIES WAGE INEQUALITY INCOME DISTRIBUTION GLOBALIZATION FOREIGN INVESTMENTS INCOME INEQUALITIES HOUSEHOLD DATA FOREIGN DIRECT INVESTMENTS OPEN ECONOMIES |
| spellingShingle |
ADVANCED COUNTRIES AGRICULTURE AVERAGE INCOMES AVERAGE SHARE BENCHMARK COMPARATIVE ADVANTAGE COMPETITIVENESS DECREASING INEQUALITY DEMOCRACY DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DEVELOPED COUNTRIES DEVELOPED ECONOMIES DIRECT INVESTMENT DISTRIBUTION DATA EDUCATIONAL ATTAINMENT EMPLOYMENT EQUALIZING EFFECT EXPENDITURES EXPORTS FINANCIAL DEPTH FINANCIAL MARKETS FOREIGN COMPETITION FOREIGN INVESTORS GDP GINI COEFFICIENT GROWTH RATES HOUSEHOLD SURVEY DATA HOUSEHOLD SURVEYS IMPORTS INCOME INCOME DIFFERENTIALS INCOME DISTRIBUTION INCOME GROUPS INCOME GROWTH INCOME INEQUALITY INCOME LEVEL INCOME LEVELS INCOME SHARE INCOME SHARES INCOMES INCREASED INEQUALITY INCREASING SHARE INEQUALITY INEQUALITY INDEX INEQUALITY MEASURE INTEREST RATE INTERNATIONAL EXCHANGE INTERNATIONAL TRADE LDCS LESS DEVELOPED COUNTRIES LOW INCOME M2 MARKET LIBERALIZATION MEAN INCOME MEAN INCOMES MEDIAN VOTER MEDIAN VOTER HYPOTHESIS MIDDLE CLASS NEGATIVE EFFECT NEGATIVE IMPACT PARLIAMENT PER CAPITA GROWTH PER CAPITA INCOME POLICY RESEARCH POLITICAL INSTITUTIONS POLITICAL SCIENTISTS POOR COUNTRIES POOR GROUPS POSITIVE EFFECT POSITIVE IMPACT PURCHASING POWER REAL INTEREST RATE REGIONAL AVERAGES REGIONAL DUMMIES RELATIVE DEMAND RELATIVE INCOME RELATIVE INCOMES RELATIVE SUPPLY RELATIVE WAGES SKILLED WORKERS THEORETICAL MODELS TRADE REFORMS TRANSITION ECONOMIES WAGE INEQUALITY INCOME DISTRIBUTION GLOBALIZATION FOREIGN INVESTMENTS INCOME INEQUALITIES HOUSEHOLD DATA FOREIGN DIRECT INVESTMENTS OPEN ECONOMIES Milanovic, Branko Can We Discern the Effect of Globalization on Income Distribution? Evidence from Household Budget Surveys |
| relation |
Policy Research Working Paper;No. 2876 |
| description |
The effects of globalization on income
distribution in rich and poor countries are a matter of
controversy. While international trade theory in its most
abstract formulation implies that increased trade and
foreign investment should make income distribution more
equal in poor countries and less equal in rich countries,
finding these effects has proved elusive. The author
presents another attempt to discern the effects of
globalization by using data from household budget surveys
and looking at the impact of openness and foreign direct
investment on relative income shares of low and high
deciles. The author finds some evidence that at very low
average income levels, it is the rich who benefit from
openness. As income levels rise to those of countries such
as Chile, Colombia, or Czech Republic, for example, the
situation changes, and it is the relative income of the poor
and the middle class that rises compared with the rich. It
seems that openness makes income distribution worse before
making it better--or differently in that the effect of
openness on a country's income distribution depends on
the country's initial income level. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Milanovic, Branko |
| author_facet |
Milanovic, Branko |
| author_sort |
Milanovic, Branko |
| title |
Can We Discern the Effect of Globalization on Income Distribution? Evidence from Household Budget Surveys |
| title_short |
Can We Discern the Effect of Globalization on Income Distribution? Evidence from Household Budget Surveys |
| title_full |
Can We Discern the Effect of Globalization on Income Distribution? Evidence from Household Budget Surveys |
| title_fullStr |
Can We Discern the Effect of Globalization on Income Distribution? Evidence from Household Budget Surveys |
| title_full_unstemmed |
Can We Discern the Effect of Globalization on Income Distribution? Evidence from Household Budget Surveys |
| title_sort |
can we discern the effect of globalization on income distribution? evidence from household budget surveys |
| publisher |
World Bank, Washington, DC |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2002/08/1993713/can-discern-effect-globalization-income-distribution-evidence-household-budget-surveys http://hdl.handle.net/10986/19276 |
| _version_ |
1764439660419874816 |