Investigating the Impact of Technology, Innovation and Globalization on Income Inequality

Document Type : Research Paper

Authors

1 M.Sc. in Economics, Department of Economics, Faculty of Humanities and Social Sciences, University of Kurdistan, Sanandaj, Iran

2 Assistant Professor, Department of Economics, Faculty of Humanities and Social Sciences, University of Kurdistan, Sanandaj, Iran

Abstract

The present study aims to investigate the impact of technology, innovation, and globalization on income inequality in three groups of low-income countries (19 countries), middle-income countries (63 countries), and high-income countries (41 countries) in the period 2008-2019 using a panel data quantile regression model. To achieve this aim, the following indices have been used: The Gini index as a measure of income inequality; the technology and innovation index and its sub-indices, including the information and communication technology index, technological skills index, research and development index, industrial capacity index, and index of private sector access to financial resources; and the economic globalization index and its sub-indexes, including trade globalization and financial globalization. The results of this study illustrate that technology and innovation in all quantiles of the three income groups have a significant negative impact on income inequality. Moreover, the economic globalization index has a significant positive effect on income inequality in low-income countries in the lower quantiles, however, this effect is significantly negative in the middle and higher quantiles. Nevertheless, economic globalization has a significant negative impact on income inequality in middle- and high-income countries in all quantiles. According to the research results, it is suggested to policymakers, especially in low-income countries, to prioritize technology and investment in this field. On the other hand, according to the effects of globalization, policymaking should be done based on the economic structure of the countries..
JEL Classification: O3, C23, F6, D31

Keywords

References

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Journal of Economic Research (Tahghighat- E- Eghtesadi)
Volume 57, Issue 2 - Serial Number 139
January 2023
Pages 221-257

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History

  • Receive Date: 13 September 2022
  • Revise Date: 16 January 2023
  • Accept Date: 04 February 2023

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