scholarly journals National Income Inequality and International Business Expansion

2018 ◽  
Vol 59 (8) ◽  
pp. 1630-1666 ◽  
Author(s):  
Nathaniel C. Lupton ◽  
Guoliang Frank Jiang ◽  
Luis F. Escobar ◽  
Alfredo Jiménez
Keyword(s):  
Income Inequality ◽  
Multinational Enterprises ◽  
National Income ◽  
Strategic Objectives ◽  
Expansion Strategy ◽  
Foreign Production ◽  
Local Actors ◽  
Security Costs ◽  
The Impact ◽  
Additional Monitoring

We examine the extent to which host country income inequality influences multinational enterprises’ (MNE) expansion strategy for foreign production investment, depending on their specific strategic objectives. Applying a transaction cost framework, we predict that national income inequality has an inverted U-shaped relationship with foreign production investment. As inequality increases, MNEs accrue lower transaction costs arising from interactions with various local actors, leading to higher probability of investment. As income inequality increases further, its effect on location attractiveness will become negative, as its attraction effect is increasingly offset by additional monitoring, bargaining, and security costs owing to the more fractious nature of high inequality societies. In addition, we suggest that the impact of income inequality is contingent on investment objectives: The inverted U-shaped relationship is stronger for efficiency-seeking investment but weaker for market-seeking and competence-enhancing investments. We find substantial support for our hypotheses through an analysis of 27 years (1986-2012) of data on Japanese MNEs’ overseas production entries.

scholarly journals National Income Inequality, Society, and Multinational Enterprises

2018 ◽  
pp. 219-241
Author(s):  
Nathaniel C. Lupton ◽  
Guoliang Frank Jiang ◽  
Luis F. Escobar
Keyword(s):  
Income Inequality ◽  
Foreign Investment ◽  
Research Agenda ◽  
Multinational Enterprises ◽  
National Income ◽  
Entry Mode ◽  
National Differences ◽  
Security Costs ◽  
Positive Effect ◽  
Different Levels

This chapter calls for understanding the perspective of multinational enterprises (MNEs) on international differences in income inequality. The authors set a research agenda on how national differences in income inequality influence MNE expansion strategies. Applying a transaction cost framework, both negative and positive economic outcomes of income inequality, from the MNE's perspective, are identified. Low levels of income inequality may deter foreign investment, as MNEs prefer countries where they incur lower levels of transaction costs arising from interactions with various market and non-market actors. However, the positive effect of income inequality on location attractiveness will likely diminish at higher levels of inequality when benefits are increasingly offset by additional monitoring, bargaining and security costs owing to instability and conflict. The chapter further explores the implications for level of MNE equity applied in the choice of entry mode under different levels of income inequality.

scholarly journals ПОДХОДЫ К ВЫБОРУ ПОЛИТИКИ НАЛОГООБЛОЖЕНИЯ В КОНТЕКСТЕ РЫНОЧНЫХ СТИМУЛОВ: ПРИМЕР АРМЕНИИ

2020 ◽  
Vol 2 (30) ◽  
pp. 4-13
Author(s):  
Ани Аветисян ◽  
Keyword(s):  
Income Inequality ◽  
Income Tax ◽  
National Income ◽  
Social Benefits ◽  
Tax Rates ◽  
State Budget ◽  
Tax System ◽  
Market Incentives ◽  
Before And After ◽  
The Impact

Features of progressive, proportional and regressive types of taxation in the framework of the national income redistribution system are considered. The paper analyzes the literature devoted to the study of the impact of tax types on market incentives. The influence of the system of deductions and social benefits on the level of income inequality of the population and revenues to the state budget is considered. The article presents the income tax system in Armenia, statistics on the level of employment by industry, wages and taxes paid before and after the reform of the transition to the proportional tax scale, which came into force on January 1, 2020. Examples of a number of countries that use differentiation of tax rates depending on marital status are given. The analysis concluded that the weakness of economic regulatory institutions is a more significant factor than the level of tax rates

The impact of multinational companies on inequality in Western Balkan countries

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Leonita Braha-Vokshi ◽  
Gadaf Rexhepi ◽  
Veland Ramadani ◽  
Hyrije Abazi-Alili ◽  
Arshian Sharif
Keyword(s):  
Income Inequality ◽  
Income Distribution ◽  
Multinational Corporations ◽  
Multinational Enterprises ◽  
Random Effect ◽  
Multinational Companies ◽  
Critical Question ◽  
Content Type ◽  
Theoretical Contribution ◽  
The Impact

Purpose The purpose of this study is to investigate the impact on income distribution from foreign investment and open trade. The research highlights the impact of multinational enterprises (MNEs) on inequality in Western Balkan (WB) countries from 2007 to 2019. The study seeks to answer a critical question: how do multinational corporations affect income distribution? Design/methodology/approach The study uses different techniques such as two-stage least squared, fixed and random effect estimators and generalised method of moments (GMM). The data was gathered from the United Nations Development Programme, World Bank Indicators (WB) and Slot’s World Standardised Income Inequality Database. Findings The interaction of multinational companies through foreign direct investment (FDI) has a significant impact on income inequality. This research paper indicates that the effect of FDI on income inequality is significant and has a negative effect on income inequality within WB countries. The results from the GMM estimator, therefore, demonstrate the hypothesis that multinational companies have a positive effect in WBs countries on reducing inequality. Originality/value The theoretical contribution that this paper seeks to make is by the applying of incremental changing dimension or more specifically, through expanding existing knowledge. Based on a study of the prior articles, the authors found out that the majority of the papers discussed only income inequality or economic inequality or rarely education, but none of the papers examined all classifications of inequality in one paper. This paper’s second contribution is to calculate inequality not only by the Gini coefficient but also by the human development index. The study is unique in that it is the first to assess the impact of FDI on income distribution in WB countries. The research is unique in that it attempts to shed light on the impact of multinational corporations on inequality in Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia. The findings of this study will help to develop new policies, new legislation, reducing inequity and support FDIs and MNEs for governments and policymakers.

Income Inequality within Countries

2021 ◽  
pp. 91-111
Author(s):  
Andy Sumner
Keyword(s):  
Developing Countries ◽  
Economic Development ◽  
Income Inequality ◽  
Empirical Evidence ◽  
Developing World ◽  
National Income ◽  
Global Inequality ◽  
Seminal Work ◽  
Great Transformation ◽  
The Impact

This chapter addresses the within-country component of global inequality and the impact of deindustrialization on national income inequality. The chapter focuses on the fourth great transformation outlined, specifically the shift to a form of immiserizing growth. This chapter revisits Kuznets’ seminal work and asks what trend might be expected for national inequality during deindustrialization. The chapter makes estimates of the empirical evidence on deindustrialization, tertiarization, and national income inequality in developing countries. The accompanying myth—that if developing countries integrate more and more into GVC world, the process will lead to broad-based economic development—is critiqued. A theoretical exposition to explain the connection between deindustrialization, tertiarization, and rising national income inequality in the developing world is given.

Growth quality and income inequality: cross-country analysis

2021 ◽  
Vol 17 (4) ◽  
pp. 454-461
Author(s):  
Bulat Khusainov ◽  
Asset Nussupov
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Negative Impact ◽  
Time Lag ◽  
National Income ◽  
Income Levels ◽  
Cross Country ◽  
The Impact ◽  
The Relationship

The article is devoted to the construction and implementation of an econometric model for quantitative assessment of the impact of cross-country, international, and national income inequality on the dynamics and quality of growth of four groups of countries with different levels of development. A substantial analysis of numerous Russian and foreign research that discover the dynamics and quality of growth was carried out. On this basis, we conclude that income inequality is an important characteristic of the quality of growth of both the national and global economies. To study the relationship between inequality and economic growth, the research uses two concepts proposed by the World Bank – cross-country and international inequality. The distinction of this study from all other known works is not in identifying the genesis of the phenomenon of «inequality», but in focusing on the development of concepts of inequality between countries and quantity assessment of their impact on the growth of economies with different income levels (high, above average, below average and low). This development contributes to the expansion of the research landscape that analyses the relationship between economic growth and inequality. The implementation of the constructed model of cross-country regression confirmed the assumption on the negative impact of three types of inequality on countries with different income levels. At that, the degree of their influence for four groups of countries is shown with a different time lag. The statistically significant empirical results are the convincing scientific basis for evidence-based policy while developing an adequate economic policy by national governments, especially in modern conditions

Understanding Rising Income Inequality and Stagnating Ordinary Living Standards in Germany

2018 ◽  
Author(s):  
Gerhard Bosch ◽  
Thorsten Kalina
Keyword(s):  
Income Inequality ◽  
Labour Market ◽  
Economic Crisis ◽  
Household Income ◽  
Wage Bargaining ◽  
Living Standards ◽  
Social Model ◽  
Real Wages ◽  
The Impact ◽  
Over Time

This chapter describes how inequality and real incomes have evolved in Germany through the period from the 1980s, through reunification, up to the economic Crisis and its aftermath. It brings out how reunification was associated with a prolonged stagnation in real wages. It emphasizes how the distinctive German structures for wage bargaining were eroded over time, and the labour market and tax/transfer reforms of the late 1990s-early/mid-2000s led to increasing dualization in the labour market. The consequence was a marked increase in household income inequality, which went together with wage stagnation for much of the 1990s and subsequently. Coordination between government, employers, and unions still sufficed to avoid the impact the economic Crisis had on unemployment elsewhere, but the German social model has been altered fundamentally over the period

scholarly journals Income Distribution in Turkey during the Global Financial Crisis

2017 ◽  
Vol 9 (3) ◽  
pp. 91
Author(s):  
Sinem Sefil-Tansever
Keyword(s):  
Financial Crisis ◽  
Income Inequality ◽  
Global Financial Crisis ◽  
Income Source ◽  
Labor Earnings ◽  
Income Sources ◽  
Gini Decomposition ◽  
The Global Financial Crisis ◽  
The Impact ◽  
Earning Inequality

The aim of this study is to examine mechanism responsible for the behavior of the income and earning inequality in Turkey during the global financial crisis based on data from the 2006 to 2014 Income and Living Conditions Survey. Gini decomposition by income source is employed in order to provide an analysis of the contribution of the various income sources to the evolution of income inequality and to assess the impact of a marginal percentage change in the income from a particular source on income inequality. For examining the contributions of specific variables (education, position in occupation, economic sector) to the interpretation of labor earnings inequality in terms of their gross and marginal contribution, we use static decomposition of Theil T index.

The effects of debt restructurings on income inequality in the developing world

2021 ◽  
pp. 135406612110014
Author(s):  
Glen Biglaiser ◽  
Ronald J. McGauvran
Keyword(s):  
Developing Countries ◽  
Panel Data ◽  
Income Inequality ◽  
Income Distribution ◽  
Government Spending ◽  
Tax Reform ◽  
Social Spending ◽  
The Poor ◽  
The Rich ◽  
The Impact

Developing countries, saddled with debts, often prefer investors absorb losses through debt restructurings. By not making full repayments, debtor governments could increase social spending, serving poorer constituents, and, in turn, lowering income inequality. Alternatively, debtor governments could reduce taxes and cut government spending, bolstering the assets of the rich at the expense of the poor. Using panel data for 71 developing countries from 1986 to 2016, we assess the effects of debt restructurings on societal income distribution. Specifically, we study the impact of debt restructurings on social spending, tax reform, and income inequality. We find that countries receiving debt restructurings tend to use their newly acquired economic flexibility to reduce taxes and lower social spending, worsening income inequality. The results are also robust to different model specifications. Our study contributes to the globalization and the poor debate, suggesting the economic harm caused to the less well-off following debt restructurings.

scholarly journals Rural-Spatial Restructuring Promoted by Land-Use Transitions: A Case Study of Zhulin Town in Central China

Land ◽  
2021 ◽  
Vol 10 (3) ◽  
pp. 234
Author(s):  
Dong Han ◽  
Jiajun Qiao ◽  
Qiankun Zhu
Keyword(s):  
Land Use ◽  
Rural Development ◽  
Structural Changes ◽  
Land Use Changes ◽  
Central China ◽  
Rural Space ◽  
Spatial Restructuring ◽  
Local Actors ◽  
The Impact

Rural-spatial restructuring involves the spatial mapping of the current rural development process. The transformation of land-use morphologies, directly or indirectly, affects the practice of rural restructuring. Analyzing this process in terms of the dominant morphology and recessive morphology is helpful for better grasping the overall picture of rural-spatial restructuring. Accordingly, this paper took Zhulin Town in Central China as a case study area. We propose a method for studying rural-spatial restructuring based on changes in the dominant and recessive morphologies of land use. This process was realized by analyzing the distribution and functional suitability of ecological-production-living (EPL) spaces based on land-use types, data on land-use changes obtained over a 30-year observation period, and in-depth research. We found that examining rural-spatial restructuring by matching the distribution of EPL spaces with their functional suitability can help to avoid the misjudgment of the restructuring mode caused by the consideration of the distribution and structural changes in quantity, facilitating greater understanding of the process of rural-spatial restructuring. Although the distribution and quantitative structure of Zhulin’s EPL spaces have changed to differing degrees, ecological- and agricultural-production spaces still predominate, and their functional suitability has gradually increased. The spatial distribution and functional suitability of Zhulin are generally well matched, with 62.5% of the matched types being high-quality growth, and the positive effect of Zhulin’s spatial restructuring over the past 30 years has been significant. We found that combining changes in EPL spatial area and quantity as well as changes in functional suitability is helpful in better understanding the impact of the national macro-policy shift regarding rural development. Sustaining the positive spatial restructuring of rural space requires the timely adjustment of local actors in accordance with the needs of macroeconomic and social development, and a good rural-governance model is essential.

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