Long-run dynamics between trade liberalization and income inequality in the European Union: a second generation approach
Empirica, cilt.49, sa.2022, ss.769-792, 2022 (SSCI, Scopus)
- Yayın Türü: Makale / Tam Makale
- Cilt numarası: 49 Sayı: 2022
- Basım Tarihi: 2022
- Doi Numarası: 10.1007/s10663-022-09539-8
- Dergi Adı: Empirica
- Derginin Tarandığı İndeksler: Social Sciences Citation Index (SSCI), Scopus, IBZ Online, International Bibliography of Social Sciences, ABI/INFORM, Business Source Elite, Business Source Premier, EconLit, Geobase, PAIS International, Political Science Complete, Sociological abstracts, Worldwide Political Science Abstracts
- Sayfa Sayıları: ss.769-792
- Anahtar Kelimeler: Trade liberalization, Income inequality, Panel cointegration, Cross-section dependence, European Union
- Ankara Yıldırım Beyazıt Üniversitesi Adresli: Evet
Özet
The surprisingly limited literature investigating whether there exists a long-run association between trade liberalization and income inequality finds strong evidence for it. We point out a possible model misspecification due to ignoring the presence of cross-section dependence. Using a panel of 15 EU countries in the 1985–2017 period we show that there is strong evidence for the presence of cross-section dependence. Therefore, we use so-called second-generation procedures (which are robust to cross-section dependence) and find no evidence that trade liberalization and income inequality share a long-run cointegrating relationship in the European Union.