Trade And Regional Inequality

Abstract

No AccessPolicy Research Working Papers22 Jun 2013Trade And Regional InequalityAuthors/Editors: Andres Rodriguez-PoseAndres Rodriguez-Posehttps://doi.org/10.1596/1813-9450-5347SectionsAboutPDF (0.7 MB) ToolsAdd to favoritesDownload CitationsTrack Citations ShareFacebookTwitterLinked In Abstract:This paper examines the relationship between openness and within-country regional inequality across 28 countries over the period 1975-2005, paying special attention to whether increases in global trade affect the developed and developing world differently. Using a combination of static and dynamic panel data analysis, we find that while increases in trade per se do not lead to greater territorial polarization, in combination with certain country-specific conditions, trade has a positive and significant association with regional inequality. In particular, states with higher inter-regional differences in sector endowments, a lower share of government expenditure, and a combination of high internal transaction costs with a higher degree of coincidence between the regional income distribution and regional foreign market access positions have experienced the greatest rise in territorial inequality when exposed to greater trade flows. This means that changes in trade regimes have had a more polarizing effect in low and middle-income countries, whose structural features tend to potentiate the trade effect and whose levels of internal spatial inequality are, on average, significantly higher than in high-income countries. Previous bookNext book FiguresReferencesRecommendedDetailsCited ByThe Impact of Trade Openness on Regional Inequality: The Cases of India and BrazilThe International Trade Journal, Vol.27, No.3Trade infrastructure and firm location under Cournot competitionThe Annals of Regional Science, Vol.50, No.127 December 2011 View Published: August 2010 Copyright & Permissions Related TopicsMacroeconomics and Economic GrowthInternational Economics & TradePrivate Sector Development KeywordsAGRICULTURECOMPARATIVE ADVANTAGECOMPARATIVE ADVANTAGESCOMPETITIVENESSDYNAMIC ANALYSISECONOMETRIC ANALYSISECONOMIC GEOGRAPHYECONOMIC GROWTHECONOMIC INTEGRATIONEXPORTSGDPGDP PER CAPITAHUMAN CAPITALINCOMEINTERNATIONAL TRADEMACROECONOMIC POLICIESMIDDLE INCOME COUNTRIESPURCHASING POWERREAL GDPRENT SEEKING PDF DownloadLoading ...