GLOBALIZATION AND INCOME DISTRIBUTION EFFECTS

Abstract

Globalization has been one of the most critical phenomena in the 20. century. However, there is no consensus about its benefits and losses notwithstanding ongoing argues on it. There are two important factors which affect globalization. One of them is decreasing in transportation and communication costs for private sector, which result from technological innovations. And the other is decreasing barriers on trade, direct foreign investments and capital flows by which affects of the politicies implemented by developed countries and international organizations. There are a lot of opinions against globalization both in developed and in developing countries. One of the basic causes of these reactions against globalization is increasing unemployment and shrinking income of some groups coincides with increasing foreign trade, and the other is increasing economic instabilities especially in developing countries during the globalization. In this context, globalization plays an important role in both distribution of world income among the countries and distribution of national income. Therefore, the aim of this study is to evaluate the effects of globalization on poverty and income inequality in the framework of developing and developed countries.