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Globalisation and the efficiency-equity trade-off

Author

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  • Beck, Roland
  • Di Nino, Virginia
  • Stracca, Livio

Abstract

We revisit the effects of globalisation over the past 50 years in a large sample of advanced and emerging countries. We use accessions to \Globalisation Clubs" (WTO, OECD, EU), financial liberalisation and an instrument for trade openness to study the trade-off between efficiency (proxied by real GDP per capita and TFP) and equity (proxied by the labour share of income and the Gini index of inequality). We find that (i) most of our episodes lead to an increase in trade openness (ii) effects on GDP per capita are mostly positive with some interesting exceptions and (iii) there is little evidence that globalisation shocks lead to more inequality. JEL Classification: F13, F36

Suggested Citation

  • Beck, Roland & Di Nino, Virginia & Stracca, Livio, 2021. "Globalisation and the efficiency-equity trade-off," Working Paper Series 2546, European Central Bank.
    • Handle: RePEc:ecb:ecbwps:20212546
    Note: 597822
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    References listed on IDEAS

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    Cited by:

    1. Kim, Soyoung & Shim, Seri & Park, Donghyun, 2022. "Dynamic interactions between trade globalization and financial globalization: A heterogeneous panel VAR approach," Journal of International Money and Finance, Elsevier, vol. 122(C).

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    More about this item

    Keywords

    efficiency; equity; EU; financial liberalization; globalisation; OECD; trade integration; WTO;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration

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