The “Forgotten†Middle Class: An Analysis of the Effects of Globalisation

Regina Pleninger (), Jan-Egbert Sturm and Jakob de Haan
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Regina Pleninger: KOF Swiss Economic Institute, ETH Zurich, Switzerland

No 19-466, KOF Working papers from KOF Swiss Economic Institute, ETH Zurich

Abstract: This paper studies the effects of globalisation on the income share of the middle class. Our findings suggest that globalisation, proxied by the KOF Economic Globalisation Index, reduces the income share of the middle class. The income share of the poorest 20% also drops due to globalisation, while that of the richest 20% increases. When we distinguish between de facto and de jure globalisation, we find that only de facto measures have statistically significant effects on income shares and inequality measures. Our results are robust for alternative definitions of the middle-class income share and hold for trade and financial globalisation.

Keywords: middle class; income inequality; globalisation; income shares (search for similar items in EconPapers)
JEL-codes: D31 F62 I24 O15 (search for similar items in EconPapers)
Pages: 61 pages
Date: 2019-07
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:kof:wpskof:19-466

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