Abstract
Digitalization is the most important indicator of technological development. More specifically, digitalization affects income distribution in different ways. Improvement in digital technologies promotes labour productivity and economic efficiency. Hence, how digitalization affects income inequality is required to obtain more evidence. This study investigates the distributional impact of digitalization in 29 Emerging Industrial Economies (EIEs) over the period 2000-2020. The panel ARDL model estimation results show digitalization alleviates income inequality. Likewise, economic growth, globalization, and institutional quality also negatively affect income inequality. In addition, economic growth, globalization, and institutional quality support the encouraging effect of digitalization on income inequality. Moreover, the Dumitrescu-Hurlin (DH) panel causality test result confirms the two-way causality between economic growth, globalization, and digitalization with income inequality, and the one-way causality running from income inequality to institutional quality.
Publisher
Abant Izzet Baysal University Graduate School of Social Sciences