"Globalization and Inequality Past and Present"

Jeffrey G. Williamson

NBER Working Paper No. 5491
Issued in March 1996
NBER Program(s):Development of the American Economy, International Trade and Investment

The late 19th and the late 20th century shared more than simply globalization and convergence. Globalization also seems to have had the same impact on income distribution: in the late 19th century, inequality rose in rich countries and fell in poor countries; according to Adrian Wood, the same has been true of the late 20th century. Furthermore, while George Borjas and Wood think that globalization accounted for something like a third to a half of the rise in inequality in America and other OECD countries since the 1970s, the late 19th century evidence suggests at least the same, perhaps more. However, those modern economists who favor a rising inequality explanation coming from (unskilled)-labor-saving technological change will be pleased to hear that it probably accounted for more than a third of the rising inequality in the New World and for more than a half of the falling inequality in Europe. It also appears that the inequality trends which globalization produced prior to World War I were at least partly responsible for the interwar retreat from globalization. Will the world economy of the next century also retreat from its commitment to globalization because of its inequality side effects?

download in pdf format
   (691 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w5491

Published: World Bank Research Observer, Vol. 12, no. 2 (August 1997): 117-135. citation courtesy of

Users who downloaded this paper also downloaded* these:
Feenstra and Hanson w5424 Globalization, Outsourcing, and Wage Inequality
Lindert and Williamson Does Globalization Make the World More Unequal?
O'Rourke w8339 Globalization and Inequality: Historical Trends
Lindert and Williamson w8228 Does Globalization Make the World More Unequal?
O'Rourke and Williamson w7632 When Did Globalization Begin?
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us