Globalization and inequality

Globalization is increasingly linked to inequality, but with often divergent and polarized findings. Some researchers show that globalization accentuates inequality both within and between countries. Others maintain that these claims are patently incorrect, arguing that globalization has disintegrated national borders and prompted economic integration, lifting millions out of poverty, and closing the inequality gap. This article presents a review of current research that links globalization to inequality. Core problems behind contradictory findings appear to rest in the operationalization of inequality and globalization, availability and quality of data, population-weighted versus unweighted estimates; and, the method of income calibration to a common currency in the study of income inequality. A theoretical model charts the mechanisms linking globalization to inequality, illustrating how it generates increased inequality within industrialized nations and decreased inequality within developing economies. The article concludes with a description of the papers in this special issue and situates them within the broader literature.