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Globalizing Inequality: ‘Centrifugal’ and ‘Centripetal’ Forces at Work

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  • José Gabriel Palma

Abstract

This paper reassesses national income inequalities in this era of globalization. The main conclusion is that two opposite forces are at work: one ‘centrifugal’ at the two extremes of the distribution—increasing the disparity of income shares appropriated by the top and by the bottom four deciles across countries; and the other ‘centripetal’ in the middle—increasing the uniformity of the share of income going to deciles 5 to 9. Therefore, globalization is creating a situation where virtually all the intercountry diversity of income distribution is the result of differences in what the rich and the poor get in each country.

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File URL: http://www.un.org/esa/desa/papers/2006/wp35_2006.pdf
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Bibliographic Info

Paper provided by United Nations, Department of Economics and Social Affairs in its series Working Papers with number 35.

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Length: 26 pages
Date of creation: Sep 2006
Date of revision:
Handle: RePEc:une:wpaper:35

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Keywords: economic development; structural change; comparative studies; development policy;

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  1. Haskel, Jonathan, 2000. "The Trade and Labour Approaches to Wage Inequality," CEPR Discussion Papers 2476, C.E.P.R. Discussion Papers.
  2. Atkinson, A B, 1997. "Bringing Income Distribution in from the Cold," Economic Journal, Royal Economic Society, vol. 107(441), pages 297-321, March.
  3. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, World Bank Group, vol. 10(3), pages 565-91, September.
  4. Wolfson, Michael C, 1994. "When Inequalities Diverge," American Economic Review, American Economic Association, vol. 84(2), pages 353-58, May.
  5. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-42, June.
  6. Deepak Lal, 1993. "Poverty and Development," UCLA Economics Working Papers 707, UCLA Department of Economics.
  7. José Gabriel Palma, 2005. "The seven main "stylized facts" of the Mexican economy since trade liberalization and NAFTA," Industrial and Corporate Change, Oxford University Press, vol. 14(6), pages 941-991, December.
  8. Paul Krugman & Robert Lawrence, 1993. "Trade, Jobs, and Wages," NBER Working Papers 4478, National Bureau of Economic Research, Inc.
  9. William R. Cline, 1997. "Trade and Income Distribution," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 58.
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Cited by:
  1. Alex Cobham & Andrew Sumner, 2013. "Is it all about the tails? The Palma measure of income inequality," Working Papers 308, ECINEQ, Society for the Study of Economic Inequality.
  2. Amanda Lenhardt & Andrew Shepherd, 2013. "What has happened to the poorest 50%?," Brooks World Poverty Institute Working Paper Series 18413, BWPI, The University of Manchester.
  3. Milanovic, Branko & Ersado, Lire, 2008. "Reform and Inequality during the Transition: An Analysis Using Panel Household Survey Data, 1990-2005," Policy Research Working Paper Series 4780, The World Bank.
  4. Costanza Consolandi & Giampaolo Gabbi & Massimo Matthias & Pietro Vozzella, 2013. "The Italian Financial System," FESSUD studies fstudy12, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
  5. Alex Cobham, Andy Sumner, 2013. "Is It All About the Tails? The Palma Measure of Income Inequality-Working Paper 343," Working Papers 343, Center for Global Development.

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