Economics, Econometrics and Finance
4 years ago

Trade boosts income without widening inequality, study finds.

RePEc: Research Papers in Economics
Trade and Income in the Long Run: Are There Really Gains, and Are They Widely Shared?
Diego Cerdeiro, András Komáromi

Paper Summary

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Trade has a positive impact on a country's income over time, and it does not increase income inequality. Researchers used a method to see if trade causes changes in income and inequality, and found that more trade leads to higher income without making inequality worse. They made sure their method was accurate and confirmed that trade's effects were not influenced by other factors like geography.