Does wealth inequality reduce the gains from trade?

Caselli, Mauro
June 2012
Review of World Economics;Jun2012, Vol. 148 Issue 2, p333
Academic Journal
This paper refines and tests the hypothesis that the impact of opening to trade on a country's economic growth is affected by the inequality of its distribution of wealth. Analysis of panel data on 44 developing countries between 1960 and 2000 suggests that the difference in growth rates between the period an economy is open and the period it is closed depends inversely on the degree of wealth inequality prior to opening. There is evidence to suggest that access to credit and lack thereof may lie behind these results, thus highlighting a new aspect of the role of financial development.


Related Articles

  • ON THE MEASUREMENT OF EDUCATION'S CONTRIBUTION TO GROWTH. Selowsky, Marcelo // Quarterly Journal of Economics;Aug69, Vol. 83 Issue 3, p449 

    This article analyzes the contribution of education to growth in a group of less developed countries. The study of the sources of economic growth haa become in the last ten years an important part of economic literature. A frequent approach to this problem has entailed the use of an aggregate...

  • Trade unions in the "South" in the era of globalization.  // CEPAL Review;Apr2010, Issue 100, p97 

    No abstract available.

  • Free Markets and Poverty. Weller, Christian E.; Hersh, Adam // American Prospect;Winter2002 Supplement, pA13 

    Focuses on the use of free market in the alleviation of poverty in developing countries. Reason that the laissez-faire approach to development has worsened growth and income distribution; Increase in the flow of capital in the countries; Role of trade liberalization in expanding inequality and...

  • Population growth and north-south uneven development. Sasaki, Hiroaki // Oxford Economic Papers;Apr2011, Vol. 63 Issue 2, p307 

    This paper develops a model of North-South trade and economic development. The model is consistent with two empirical facts: (1) the growth rate of income per capita differs across countries; and (2) the relationship between the growth of population and that of income per capita differs for...

  • First World-Third World linkages: external relations and economic development. Dolan, Michael B.; Tomlin, Brian W. // International Organization;Winter80, Vol. 34 Issue 1, p41 

    Structural theories of dependency have proved difficult to test empirically, but attempts to do so have yielded significant findings about relationships between First World-Third World economic linkages, on the one hand, and various aspects of economic development in the Third World, on the...

  • Global inequality and international trade. Ghose, Ajit K. // Cambridge Journal of Economics;Mar2004, Vol. 28 Issue 2, p229 

    The paper analyses the effect of widespread trade liberalisation on global income inequality. The analysis of the trend in global inequality during 1981-97, presented in the first pan of the paper, shows that the apparent growth of income inequality among countries conceals a process of...

  • Thirlwall's law and the two-gap model: toward a unified "dynamic gap" model. Garc�a-Molina, Mario; Ru�z-Tavera, Jeanne Kelly // Journal of Post Keynesian Economics;Winter2009, Vol. 32 Issue 2, p269 

    This paper puts forward a unified model of two of the most relevant demand-based explanations of economic growth�Thirlwall's law and the two-gap model. Under certain specifications, it is shown that Thirlwall's law extended with capital flows is equivalent to the "external gap." Our unified...

  • Trade, Growth, and Poverty. Dollar, David; Kraay, Aart // Economic Journal;Feb2004, Vol. 114 Issue 493, pF22 

    A key issue today is the effect of globalisation on inequality and poverty. Well over half the developing world lives in globalising economies that have seen large increases in trade and significant declines in tariffs. They are catching up with the rich countries while the rest of the...

  • ECONOMY.  // Brazil Country Profile;2007, p13 

    The article information on the economic background, performance, and major trading partners of Brazil in 2007. The economy of the country is expected to record a compound annual growth rate (CAGR) of 2.74 percent during 2007-2011. Brazil needs to increase its international competitiveness in the...


Read the Article


Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics