Asymmetric Globalization, Top Performers’ Income and Inequality

Abstract

This paper proposes a new explanation for the rise in top performers’ income based on an asymmetry in globalization, with one country producing globalized non-rivalrous performances, other countries producing purely domestic ones. In the country with globalized performances, the globalization dynamics (growing number of countries involved in the global market) entails an increase in the number and incomes of performers and an increase in inequality by the top. In countries with purely national performances, the participation in the global economy reduces the number and incomes of performers and lessens inequality by the top. In contrast, when globalization is symmetric (all countries producing globalized performances), there is no change in the number and incomes of performers in all countries compared to cultural autarky. These results are in line with several characteristics observed in activities directly impacted by the cultural supremacy of the US and English speaking countries in the global economy.

Keywords: Asymmetry, Globalization, Inequality, Performers, Superstars