Affiliation:
1. Department of Economics, Society and Politics, University of Urbino, Urbino, Italy
Abstract
Growth in international trade between countries at different levels of development is one of the main drivers of economic globalization. This phenomenon relates to the new international division of labour in which an Emerging Periphery, hosting the offshoring and outsourcing of world manufacturing, stands between a developed Center and a still backward, Poor Periphery. Following the analysis of the relative and absolute indices of global locational inequality, the effect of the unequal exchange on world income distribution in the last 25 years is investigated. A new methodology based on real currency misalignments and value-added trade is presented, which accounts also for international value transfers within global value chains. The counterfactual test shows that trade value transfers represent a significant source of revenue for the Center diverted from the Peripheries. Unequal exchange widens the opportunity gap between citizens of rich and poor countries through an increase in global locational inequality. Redefining post-pandemic international economic rules should therefore recognize the effect of unequal exchange on global inequality.
Subject
Environmental Science (miscellaneous),Geography, Planning and Development
Reference73 articles.
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2. Atkinson A, Brandolini A (2004) Global world inequality: Absolute, relative or intermediate? Paper prepared for the 28th IARIW General Conference, Cork, Ireland, August 22–28.
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