Advanced Search
MyIDEAS: Login

Globalisation, EU enlargement and income distribution

Contents:

Author Info

  • Fritz Breuss

Abstract

Advanced industrial countries have been exhibiting a steady decline of the labour income shares in the last two decades. We explain this phenomenon by resorting to the old Stolper-Samuelson theorem. The conclusions concerning the impact of free trade on the income distribution are unambiguous in a Heckscher-Ohlin world with two countries, two goods and two factors of production (capital and labour). In contrast, the consequences of FDI from the capital abundant country (EU) to the labour abundant CEEC are ambiguous. Both scenarios are investigated theoretically, simulated with a hypothetical two country CGE model, including the EU and the CEEC and then tested empirically. Accordingly, globalisation has contributed to a decline in the labour income shares in the EU and an increase in the CEEC. Additionally, those EU countries which are engaged more in trade with the CEEC ('mini-globalisation' in Europe) can expect a sharper decline in the wage share.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.inderscience.com/link.php?id=31204
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Inderscience Enterprises Ltd in its journal Int. J. of Public Policy.

Volume (Year): 6 (2010)
Issue (Month): 1/2 ()
Pages: 16-34

as in new window
Handle: RePEc:ids:ijpubp:v:6:y:2010:i:1/2:p:16-34

Contact details of provider:
Web page: http://www.inderscience.com/browse/index.php?journalID=97

Related research

Keywords: globalisation; EU enlargement; income distribution; European Union; free trade; FDI; foreign direct investment; CEEC; simulation; modelling; labour income shares; Central and Eastern European countries.;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Egger, Peter & Larch, Mario & Pfaffermayr, Michael, 2007. "On the welfare effects of trade and investment liberalization," European Economic Review, Elsevier, vol. 51(3), pages 669-694, April.
  2. Hartmut Egger & Peter Egger, 2002. "How international outsourcing drives up Eastern European wages," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 138(1), pages 83-96, March.
  3. James R. Markusen, 2004. "Multinational Firms and the Theory of International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262633078, December.
  4. Özlem Onaran & Engelbert Stockhammer, 2006. "The effect of FDI and foreign trade on wages in the Central and Eastern European Countries in the post-transition era: A sectoral analysis," Department of Economics Working Papers wuwp094, Vienna University of Economics, Department of Economics.
  5. Peter Egger & Mario Larch & Michael Pfaffermayr, 2007. "Bilateral versus Multilateral Trade and Investment Liberalisation," The World Economy, Wiley Blackwell, vol. 30(4), pages 567-596, 04.
  6. Adrian Wood, 2002. "Globalization and wage inequalities: A synthesis of three theories," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 138(1), pages 54-82, March.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Özlem Onaran, 2008. "The effect of import penetration on labor market outcomes in Austrian manufacturing industry," Department of Economics Working Papers wuwp119, Vienna University of Economics, Department of Economics.
  2. Özlem Onaran, 2008. "The Effects of Globalization on Wages, Employment, and Wage Share in Austria," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 34(3), pages 337-360.
  3. Özlem Onaran, 2008. "The effect of foreign affiliate employment on wages, employment, and the wage share in Austria," Department of Economics Working Papers wuwp118, Vienna University of Economics, Department of Economics.
  4. Fritz Breuss, 2013. "Europe as a Global Player," WIFO Working Papers 455, WIFO.
  5. Alfred Greiner, 2011. "Economic Growth, Public Debt and Welfare: Comparing Three Budgetary Rules," German Economic Review, Verein für Socialpolitik, vol. 12(2), pages 205-222, 05.
  6. Engelbert Stockhammer & Stefan Ederer, 2007. "Demand effects of the falling wage share in Austria," Department of Economics Working Papers wuwp106, Vienna University of Economics, Department of Economics.
  7. Fritz Breuss, 2009. "An evaluation of the EU's Fifth Enlargement With special focus on Bulgaria and Romania," European Economy - Economic Papers 361, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ids:ijpubp:v:6:y:2010:i:1/2:p:16-34. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Graham Langley).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.