Meeting: International Seminar on Information and Communication Technology Statistics, Seoul, Republic of Korea, 19-21 July 2010

Ministry of Statistics and Programme Implementation

U.S.-Japanese bilateral trade and the yen-dollar exchange rate: an empirical analysis

A large volume of econometric literature has studied the impact of economic globalisation on income inequality around the world. However, reported econometric estimates vary substantially, which makes it difficult to draw valid conclusions. This paper presents a quantitative summary and analysis of existing estimates regarding the globalisation–inequality relationship. We use a new data set consisting of 1,254 observations from 123 primary studies. By applying meta‐analysis and meta‐regression methods, we obtain several main findings. First, globalisation has a (small‐to‐moderate) inequality‐increasing effect. Second, while the effect of trade globalisation is small, financial globalisation shows a more sizeable and significantly stronger inequality‐increasing impact. Third, we find an average inequality‐increasing impact of globalisation in both advanced and developing countries. Fourth, education and technology moderate the impact of globalisation on income inequality.

https://onlinelibrary.wiley.com/doi/pdf/10.1111/twec.13007

Does economic globalisation affect income inequality? A meta-analysis

The aim of the article is to verify whether trade and inward foreign direct investments (FDI) may affect income distribution in a sample of 17 Transition Countries (TCs) over the period 1990–2006. In line with most of the previous literature, FDI do not have significant effects on income inequalities, whereas trade, especially when occurs with developed countries, seems to be more relevant. Different results are found when we take into consideration the educational system which represents an important channel through which FDI and trade may affect inequality.

Trade, foreign direct investments (FDI) and income inequality: Empirical evidence from transition countries

This paper explores how foreign direct investment (FDI) and other determinants impact income inequality in Turkey in the short- and long-run. We apply the ARDL (Auto-Regressive Distributed Lag) modelling approach, which is suitable for small samples. The data for the study cover the years from 1970 to 2008. The empirical results indicate the existence of a cointegration relationship among the variables. The positive impact of the FDI growth rate on income inequality, worsening inequality, is shown to be significant in the short-run, though at the 10% significance level only and with a quantitatively small impact, and insignificant in the long-run. In other words, FDI increases income inequality initially somewhat but this effect disappears in the long run. The literacy rate clearly reduces inequality in the long run, but also in the short run. On the other hand, population growth worsens inequality in the long run, and the effect is quite large, though it has no statistically significant effect on inequality in the short run. Also, an increase in GDP growth reduces inequality especially in the short run (at a 5% level of significance) but also in the long run (though only at the 10% level).

: Income Inequality and FDI: Evidence with Turkish Data

This paper empirically tests the link between FDI and income inequality for transitional countries in Eastern Europe and Central Asia for the period of 1990 to 2002. The theoretical motivation comes from a model developed in a previous paper, which predicts that inward FDI reduces income inequality for an economy where wage earners outnumber capital owners. Using fixed effects, there is no evidence that FDI inward stocks affect overall income inequality. However, breaking the effect into its components, the statistical evidence suggests that FDI inward stocks exacerbated wage income inequality, while reducing capital income inequality.

/pdf/effect-of-inward-foreign-direct-investment-on-income-884fenqb4v.pdf

Effect of Inward Foreign Direct Investment on Income Inequality in Transition Countries

Where are the jobs? Estimating skill-based employment linkages across sectors for the Indian economy: An input-output analysis

Did innovating firms experience improved business expectations during the pandemic? Using a survey of Indian firms conducted in June 2020, we explore whether innovating into a new product line or adapting to e-commerce platforms improved business outlook. To address the endogeneity of innovation/adaptation due to downturn in future sentiments, we use structural equations framework which relates the six-month ahead expectations of key demand (new orders) and supply variables (labour costs and raw material costs) to the two innovation strategies. Innovation strategies are in turn determined by unobservable latent variables of past demand- and supply-side shocks (experienced due to the Coronavirus pandemic and its associated lockdown in India). For expectations regarding new orders, we find that both the innovation strategies had a positive and significant impact. The innovation strategies had a mixed impact on the supply side sentiments. While firms which adopted to e-commerce were less likely to report higher expected labour costs six months in the future, neither of the two strategies improved expectations regarding raw material costs. Our paper is the first to explore the mutual relationships between business outlook, adaptation strategies and firm characteristics in India during the pandemic.

Business Expectations and Adaptation Strategies by Firms against COVID-19 Induced Economic Downturn: Evidence from India

This article examines the interactions of the import and export markets through cross-prices. The idea is that import demand is affected by export prices, because imports and exports are likely substitutes in consumption. Additionally, import supply is also affected by export prices as exports may be intermediate inputs in the production of imports. The traditional partial equilibrium model of trade is extended to include these cross-price effects in demand and supply. Theoretically, it is shown that these cross-price effects can impede trade balance adjustment in the presence of exchange rate and income shocks. Using quarterly US and rest-of-the-world data from 1975 to 2002, a fully modified general method of moments estimation of the structural equations demonstrates significance of cross-price effects in both the demand and supply of non-petroleum merchandise imports. JEL Classification: F1

Cross-Price Effects and US Trade Elasticities:

This chapter finds that educational inequality in terms of educational attainment and attendance has gone down for the youth aged 5–29 between 2007–08 and 2014, albeit at a slow pace. However, the change in secondary education has been relatively slow in the seven years. The glaring inequity is the average expenditure on secondary education in the top-most quintile. This is approximately two times even the second top-most quintile. Not only does the top-most quintile has more access to secondary education, it is being reinforced further by the significant gap in expenditure per student and therefore quality and learning outcomes. Plus, there are spatial variations in terms of both states and rural–urban gaps. In terms of outcomes, the quality of secondary education is inadequately preparing the youth for higher secondary education and work place. It is argued in this paper that the Indian secondary education needs to be made compulsory. Further, there should be focus on outcomes in terms of skills that will be needed for the twenty-first century citizens. Skills could be cognitive, non-cognitive, physical/psychomotor and technical and vocational. The secondary education system should concentrate on the supply side of skills, providing general skills that are foundation in nature, which will be needed across the work, higher education and citizenship space. Pre-vocational curricula should be included in terms of teaching attitude to work rather than trades itself. Teaching of trades and such should be taught at the higher secondary level in collaboration with firms.

Bornali Bhandari

Papers

Effect of Inward Foreign Direct Investment on Income Inequality in Transition Countries

Where are the jobs? Estimating skill-based employment linkages across sectors for the Indian economy: An input-output analysis

Business Expectations and Adaptation Strategies by Firms against COVID-19 Induced Economic Downturn: Evidence from India

Cross-Price Effects and US Trade Elasticities:

Missing Middle of Educated Unemployable: A Critical Perspective on Secondary Education in India