An Empirical Approach Analyzing the Socioeconomic Sustainability of the International Sugarcane Trade

Ricardo Luiz Machado,Thiago Vizine Da Cruz

doi:10.3390/su14042198

Abstract

The rapport between international trade and income inequality came to light after the Heckscher–Ohlin/Stolper–Samuelson theorem (HOS). Nevertheless, researchers have not concluded whether the HOS theory truly reflects reality. Even though the main focus provided by the HOS theory is on internal inequality (existing inside the country among its population), another way of analyzing the HOS theory is through income inequality among countries. This last possibility is also called income convergence. This work contributes to the topic of researching the relationship between the export of sugarcane-derived products and income to verify the income convergence effect. The cultivation of sugarcane is a relevant activity for many developing countries, including Brazil. In addition, no developed country is listed among the eight biggest sugarcane producers, which indicates that as a developing country product, it would be possible to analyze the relationship among the variables in a broader sense. The results obtained in the research indicate that the impact of the export of sugarcane products on income is minimal. Although positive, it is only perceived over time. Due to the characteristics of this research, which involves performing an analysis involving green production, green energy, and income inequality, this study is related to the seventh, eighth, and tenth United Nations’ SDG goals.

Highlights

The rapport between international trade and income inequality came to light after the Heckscher–Ohlin/Stolper–Samuelson theorem (HOS)
This paper aims to contribute to the discussion on the HOS theory by investigating the impact of international trade and the export of sugarcane products on income
The research developed in this paper aimed to contribute to the subject, researching how the export of sugarcane impacted the average income of a group of municipalities of

Summary

Introduction

The rapport between international trade and income inequality came to light after the Heckscher–Ohlin/Stolper–Samuelson theorem (HOS). Some claim that international trade leads to secondary outcomes, such as the import of new technologies, leading to a rise in the demand for skilled workers and increasing income inequality in developing countries, contradicting the HOS theory [9,10]. Another way to consider the HOS theory, besides the traditional way of focusing on income inequality inside the country, is to analyze how international trade impacts income inequality between countries. Jayanthakumaran and Verma [11] stated that following the income convergence theory, the greater the economic integration is among nations, the greater the benefits are flowing from richer countries to poorer ones

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Conclusion