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Globalization And Income Distribution Inequality Within Countries, Lei Zhou, Basudeb Biswas, Tyler J. Bowles

Economic Research Institute Study Papers

The issue studied in this paper is whether globalization affects income inequality within countries. Using the newly created Kearney (2002, 2003, 2004) data and the principal component analysis (PCA), we create two globalization indices. The Gini coefficient of a country is regressed on the indices respectively. One of the globalization indices is the equally weighted index. The other is derived from PCA. Sixty countries were involved in this study, including both developed and developing countries. The main conclusions obtained from the analysis can be summarized as follows: there is a negative relationship between the globalization index and the Gini coefficient …