Global trade boosts income redistribution, benefiting workers in open economies.
Trade liberalization affects how much support there is for policies that redistribute income between different types of workers. The study looks at how workers move between sectors and how this impacts the need for redistribution. The researchers found that in open economies, there is more support for redistribution compared to closed economies. Even though the nominal level of redistribution is lower in open economies, the actual amount of redistribution happening is higher. This suggests that globalization can lead to more government intervention in income redistribution.