Why is Income Inequality Increasing in the Developed World?

2014/11/14 by Max Roser, Jesús Crespo Cuaresma, Jesus Crespo Cuaresma · 1 citation
Economics, Econometrics and Finance · Social Sciences · #Fiscal Policy and Economic Growth #Global trade and economics #Income, Poverty, and Inequality

paper · doi:10.1111/roiw.12153

openalex publication_date 2014/11/14 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/28

Abstract

We address empirically the factors affecting the dynamics of income inequality among industrialized economies. Using a panel for 32 developed countries spanning the last four decades, our results indicate that the predictions of the Stolper–Samuelson theorem concerning the effects of international trade on income inequality find support in the data if we concentrate on imports from developing countries as a trade measure, as theory would imply. We find that democratization, the interaction of technology and education, and changes in the relative power of labor unions affect inequality dynamics robustly.

Citations

• Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations
• ESTIMATING THE INEQUALITY OF HOUSEHOLD INCOMES: A STATISTICAL APPROACH TO THE CREATION OF A DENSE AND CONSISTENT GLOBAL DATA SET
• Technical Change, Inequality, and the Labor Market

Cited by

• Income inequality in the United States [wikipedia]

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