Globalization and Inequality: The Facts

Abstract

This chapter exposes some key empirical facts which underlie the analyses and diagnoses presented in this book. The major facts are: (1) a significant change in the international trade structure since the early 1990s, characterized by a substantial increase in the weight of emerging countries (the South) and the development of offshoring; (2) in the same period a large increase in FDI from advanced (the North) to emerging countries and a decrease in migration costs of capital and persons; (3) a concomitant increase in income inequality with a huge increase of top incomes in the North; (4) a substantial decrease in corporate tax rates and in the taxation of the top of the income ladder; (5) an increase in public social expenditure (and in public debt) which has not been sufficient to offset the increase in the pre-tax inequality in the North; (6) a labour market liberalization and a decrease in the weight of trade unions.