Has Globalization Increased Inequality? *

Axel Dreher () and Noel Gaston

Review of International Economics, 2008, vol. 16, issue 3, pages 516-536

Abstract: There is no shortage of theories that purport to explain why globalization may have adverse, insignificant, or even beneficial effects on income and earnings inequality. Surprisingly, the empirical realities remain an almost complete mystery. In this paper, we use data on industrial wage inequality, household income inequality as well as measures of the economic, social and political dimensions of globalization to examine this controversial issue. Overall, while we find that globalization has exacerbated inequality; this is particularly true in the case of income inequality in OECD countries. Copyright © 2008 The Authors. Journal compilation © 2008 Blackwell Publishing Ltd.

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