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Impact of Political Regime and Economic Openness on Income Inequality: A Tale of Low-Income and OECD Countries

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  • Archana Pillai

Abstract

This paper attempts to study the changing global economic and political environment and assess its impact on fundamentals like income inequality. Scholars have time and again studied the impact of globalization and intensity of the economy. But the integration of the political climate into a comprehensive framework is attempted here. The paper aims to study the process of income inequality in both the OECD and low-income countries within a framework of variables like level of democracy, FDI, trade intensity and growth in GDP per capita. It studies 54 countries for the period 1971-2000, using multiple regression analysis technique, and also checks for robustness and accuracy of the results. The variable of the political regime (level of democracy) is found to be significant. This validates the hypothesis of using the political environment in the studies on globalization or welfare.

Suggested Citation

  • Archana Pillai, 2011. "Impact of Political Regime and Economic Openness on Income Inequality: A Tale of Low-Income and OECD Countries," The IUP Journal of Financial Economics, IUP Publications, vol. 0(4), pages 60-75, December.
    • Handle: RePEc:icf:icfjfe:v:09:y:2011:i:4:p:60-75
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    Cited by:

    1. Baek Inmee & Shi Qichao, 2016. "Impact of Economic Globalization on Income Inequality: Developed Economies vs Emerging Economies," Global Economy Journal, De Gruyter, vol. 16(1), pages 49-61, March.
    2. Kalim SIDDIQUI, 2017. "Globalisation, trade liberalisation and economic development in the developing countries: An overview," Journal of Economics Library, KSP Journals, vol. 4(4), pages 514-529, December.
    3. Carole Ibrahim, 2022. "Globalization and income inequality in developing countries: a GMM approach," SN Business & Economics, Springer, vol. 2(8), pages 1-14, August.

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