Economics at your fingertips  

Globalization, Skill Dynamics, Inequality and Welfare

Kirill Borissov and Joel Hellier

DEGIT Conference Papers from DEGIT, Dynamics, Economic Growth, and International Trade

Abstract: We analyze the impact of globalization upon education and inequality in advanced countries (the North) and upon the world welfare. We build a simple two-goods North-South intergenerational model with human capital formation and in which globalization consists of an increase in the size of the South. The model generates a continuum of possible steady states, one of which is optimal in terms of world welfare. The skill dynamics can thus produce sub-optimal states. Globalization causes an enlargement of the set of potentially sub-optimal situations and can cause the world to shift from an optimal to a sub-optimal state. Its impacts on the skill endowment and inequality depend on the intensity of the globalization shock and on the elasticity of substitution between goods. In addition, globalization produces rather different impacts upon the generation in work and upon the following generations in terms of income and inequality. Finally, there is a threshold value of the skill endowment under which inequality is lower after than before the globalization shock, and above which inequality is higher.

Keywords: Globalization; Human capital; Inequality; Welfare (search for similar items in EconPapers)
JEL-codes: F16 J24 J62 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2011-09
References: Add references at CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link) (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Can't connect to (No such host is known. )

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this paper

More papers in DEGIT Conference Papers from DEGIT, Dynamics, Economic Growth, and International Trade Contact information at EDIRC.
Bibliographic data for series maintained by Jan Pedersen ().

Page updated 2023-07-09
Handle: RePEc:deg:conpap:c016_052