Globalisation, productive systems, and inequalities

Gilles Duranton

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Using the idea that the division of labor is limited not only by the extent of the market but also by its heterogeneity, it is proposed in this paper that ''globalisation'' is redrawing the lines of division within and between countries. Our model builds on the concept of productive systems. Our results indicate that progressive trade integration among ''similar'' countries lead first to disparities between countries and then to convergence between nations but also to inequalities within nations (thus possibly accounting for the deterioration of the labor market situation of the unskilled). It is also shown that trade integration among rich economies and/or rising skills therein can lead to the marginalisation of poorer countries (thus possibly accounting for the convergence of countries in the world economy towards a twin-peaked distribution and the delinking of some countries from the world trading system).

Keywords: Productive Systems; Globalisation; Inequalities. (search for similar items in EconPapers)
JEL-codes: F12 F15 J21 (search for similar items in EconPapers)
Pages: 27 pages
Date: 1998-09
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http://eprints.lse.ac.uk/20252/ Open access version. (application/pdf)

Related works:
Working Paper: Globalisation, Productive Systems, and Inequalities (1998)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:20252

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