TY - JOUR
T1 - Spatial dependence of global income inequality
T2 - The role of economic complexity
AU - Fawaz, Fadi
AU - Rahnama-Moghadamm, Masha
N1 - Publisher Copyright:
© 2018, © 2018 Taylor & Francis.
PY - 2019/11/2
Y1 - 2019/11/2
N2 - There is extensive literature investigating the macroeconomic sources of income inequality. To our knowledge, this literature ignores the spatial dimension of global income inequality, specifically the relationship between economic relatedness and income inequality. Using panel data for 129 countries from 1964 to 2013, we show that income inequality in a country is affected by the income inequality and economic complexity of its trading partners. We find that (1) a country’s income inequality is positively correlated with the average income inequality among its top trading partners; and (2) that trade with economically more complex countries is correlated with reductions in income inequality.
AB - There is extensive literature investigating the macroeconomic sources of income inequality. To our knowledge, this literature ignores the spatial dimension of global income inequality, specifically the relationship between economic relatedness and income inequality. Using panel data for 129 countries from 1964 to 2013, we show that income inequality in a country is affected by the income inequality and economic complexity of its trading partners. We find that (1) a country’s income inequality is positively correlated with the average income inequality among its top trading partners; and (2) that trade with economically more complex countries is correlated with reductions in income inequality.
KW - Economic Complexity Index (ECI)
KW - Gini coefficient
KW - income inequality
KW - spatial econometrics
KW - trade
UR - http://www.scopus.com/inward/record.url?scp=85074585111&partnerID=8YFLogxK
U2 - 10.1080/08853908.2018.1535336
DO - 10.1080/08853908.2018.1535336
M3 - Article
AN - SCOPUS:85074585111
SN - 0885-3908
VL - 33
SP - 542
EP - 554
JO - International Trade Journal
JF - International Trade Journal
IS - 6
ER -