Regional trade networks and income inequality

This paper aims to investigate the impact of regional trade networks on income inequality using cross-country panel data from 1990 to 2019. The regional trade networks raise the average incomes of high- and low-income groups but polarize the income distribution. Furthermore, we find the asymmetric effects of income inequality, namely that income inequality is more severe in low-income countries than in higher-income countries, and the most significant beneficiaries are the upper class in low-income countries.