Can Social Protection Expenditures Cushion the Inequality Effect of Globalization?

28 Pages Posted: 8 Aug 2017 Last revised: 13 Nov 2017

See all articles by Andreas Bergh

Andreas Bergh

Research Institute of Industrial Economics (IFN); Lund University - Department of Economics

Irina Mirkina

Lund University - Department of Economics

Therese Nilsson

Research Institute of Industrial Economics (IFN); Lund University - Department of Economics

Date Written: August 7, 2017

Abstract

This paper examines whether social expenditure cushions the effect of globalization on within-country inequality, and whether this relationship varies across OECD and non-OECD countries. Using several measures of social protection from OECD and the World Bank, we analyze separately the role of education, health, and welfare expenditure. The results confirm previous findings that economic globalization — especially trade flows — associates with higher income inequality, while social expenditure sometimes seems to reduce inequality. We find no evidence that various kinds of social protection expenditure moderate the adverse effect of globalization on inequality.

Keywords: Globalization; Social expenditures; Inequality

JEL Classification: D63; F02; D30; C82

Suggested Citation

Bergh, Andreas and Mirkina, Irina and Nilsson, Therese, Can Social Protection Expenditures Cushion the Inequality Effect of Globalization? (August 7, 2017). Available at SSRN: https://ssrn.com/abstract=3014643 or http://dx.doi.org/10.2139/ssrn.3014643

Andreas Bergh

Research Institute of Industrial Economics (IFN) ( email )

Box 55665
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HOME PAGE: http://www.ifn.se/web/AndreasB

Lund University - Department of Economics ( email )

P.O. Box 7082
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Lund
Sweden

HOME PAGE: http://www.nek.lu.se/

Irina Mirkina

Lund University - Department of Economics ( email )

P.O. Box 7082
S-220 07 Lund
Sweden

Therese Nilsson (Contact Author)

Research Institute of Industrial Economics (IFN) ( email )

Box 55665
Grevgatan 34, 2nd floor
Stockholm, SE-102 15
Sweden

Lund University - Department of Economics ( email )

P.O. Box 7082
S-220 07 Lund
Sweden
+46 46 222 46 43 (Phone)

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