Working Papers, Department of Economics, Lund University
Do economic liberalization and globalization increase income inequality?
() and Therese Nilsson
Abstract: Using the newly developed KOF-index of globalization, as
well as the economic freedom index from the Fraser institute, we examine if
globalization and economic liberalizations are linked to increases in
income inequality within countries. Studying changes between 1980 and 2000,
we find a positive link between inequality and liberalization only for
certain types of reforms: Trade liberalizations, deregulation of product
and labor markets and economic globalization. The Scandinavian welfare
states have increased economic freedom and globalization more than other
countries, but they have also experienced high increases in income
Keywords: Economic freedom; Globalization; Income Inequality; Gini Coefficient; Welfare states; (follow links to similar papers)
JEL-Codes: D63; O11; P51; (follow links to similar papers)
22 pages, September 12, 2008
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