earticle

영어

This paper empirically analyzed the relationship between trade openness and Gini coefficient using data from 2011 to 2018 for 32 OECD countries and 19 non-OECD countries. This study used fixed effect model and panel simultaneous equation model for economic growth and income inequality by using panel data. The analyses results are summarized as follows. At first, according to the result of analysis for OECD countries, the economic growth rate had a negative effect on Gini coefficient, but the unemployment rate had a significant positive effect. Second, based on the non-OECD countries data analysis, the formation of fixed capital consistently had a significant negative effect on Gini coefficient. Third, it was found that trade openness had a significant positive effect on Gini coefficient. These results suggest that trade openness works as a factor that worsens income inequality. However, since this study performed regression analyses and not causal analyses, it should be avoided to definitely interpret trade openness as the cause of income inequality.