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Trade and Income Distribution in Developing Countries

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Author Info
Litwin, Carol (Department of Economics, School of Economics and Commercial Law, Göteborg University)
Abstract

This study examines the relationship between trade policy and income distribution on a cross-section of developing countries. The evidence suggests that the impact of openness on income distribution depends on the endowments of human capital. Basic education was found to be the key human capital variable determining export composition. Countries relatively well endowed with basic education tend to have higher shares of manufacturing exports and experience lower income inequality than countries with high shares of primary exports. These findings suggest that trade policies promoting manufactures should be based on expanding basic education to have the necessary poverty and inequality reducing effects.

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Publisher Info
Paper provided by Göteborg University, Department of Economics in its series Working Papers in Economics with number 9.

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Length: 38 pages
Date of creation: 03 Nov 1998
Date of revision:
Handle: RePEc:hhs:gunwpe:0009

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Postal: Department of Economics, School of Business, Economics and Law, Göteborg University Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/
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Related research
Keywords: Trade; Income Distribution; Inequality; Human Capital;

Find related papers by JEL classification:
F10 - International Economics - - Trade - - - General

This paper has been announced in the following NEP Reports:

References listed on IDEAS
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  6. Balassa, Bela, 1978. "Exports and economic growth : Further evidence," Journal of Development Economics, Elsevier, vol. 5(2), pages 181-189, June. [Downloadable!] (restricted)
  7. Ram, Rati, 1988. "Economic development and income inequality: Further evidence on the U-curve hypothesis," World Development, Elsevier, vol. 16(11), pages 1371-1376, November. [Downloadable!] (restricted)
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  9. Krueger, Anne O, 1980. "Trade Policy as an Input to Development," American Economic Review, American Economic Association, vol. 70(2), pages 288-92, May. [Downloadable!] (restricted)
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  17. Erich Gundlach, 1997. "Openness and economic growth in developing countries," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 133(3), pages 479-496, September. [Downloadable!] (restricted)
  18. Edward E. Leamer, 1992. "Wage Effects of A U.S. - Mexican Free Trade Agreement," NBER Working Papers 3991, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  19. Bourguignon, F. & Morrisson, C., 1989. "Income Distribution, Development and Foreign Trade: A Cross-Sectional Analysis," DELTA Working Papers 89-05, DELTA (Ecole normale supérieure).
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  20. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, Oxford University Press, vol. 10(3), pages 565-91, September.
  21. Owens, Trudy & Wood, Adrian, 1997. "Export-oriented industrialization through primary processing?," World Development, Elsevier, vol. 25(9), pages 1453-1470, September. [Downloadable!] (restricted)
  22. Spilimbergo, Antonio & Londono, Juan Luis & Szekely, Miguel, 1999. "Income distribution, factor endowments, and trade openness," Journal of Development Economics, Elsevier, vol. 59(1), pages 77-101, June. [Downloadable!] (restricted)
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  23. Edward E. Leamer & James Levinsohn, 1994. "International Trade Theory: The Evidence," NBER Working Papers 4940, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  24. De Long, J Bradford & Summers, Lawrence H, 1991. "Equipment Investment and Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 445-502, May. [Downloadable!] (restricted)
    Other versions:
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