Does globalization exacerbate income inequality? This paper models its effects across countries and income quantiles.
Context & Methods: Using a dynamic compositional approach with data from four nations (Canada, Germany, US, UK).
Our analysis reveals divergent impacts: some segments gain while others lose due to changing global economic structures. The outcomes differ significantly based on national factor endowments—comparing countries like Canada and Germany versus the United States.
Key Findings:
- Globalization affects different income percentiles differently, creating winners and losers across the distribution spectrum.
- Countries with varying relative resources experience distinct patterns of inequality change.
Real-World Relevance: This nuanced understanding moves beyond simple narratives about globalization's overall impact on inequality.
