Trade Liberalization, Initial Inequality and the Labor Income Share: Evidence from Latin America
(2026) EKHS21 20261Department of Economic History
- Abstract
- This thesis asks whether pre-existing income inequality has a conditioning effect on how trade openness affects the labor income share in Latin America. Using a two-way fixed effects panel covering 18 countries from 1980 to 2023, with an interaction term between trade openness and each country's initial Gini coefficient, the analysis finds no robust evidence that higher initial inequality weakens the labor income share response to trade. The most consistent finding is a negative coefficient on the human capital index, suggesting skill-biased technological change is a more powerful driver of labor share dynamics than trade openness itself.
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/student-papers/record/9251502
- author
- André, Marcus LU
- supervisor
- organization
- course
- EKHS21 20261
- year
- 2026
- type
- H1 - Master's Degree (One Year)
- subject
- keywords
- Trade liberalization, inequality, labor income share, latin america, trade openness, skill-biased technological change
- language
- English
- id
- 9251502
- date added to LUP
- 2026-09-23 09:44:29
- date last changed
- 2026-09-23 09:44:29
@misc{9251502,
abstract = {{This thesis asks whether pre-existing income inequality has a conditioning effect on how trade openness affects the labor income share in Latin America. Using a two-way fixed effects panel covering 18 countries from 1980 to 2023, with an interaction term between trade openness and each country's initial Gini coefficient, the analysis finds no robust evidence that higher initial inequality weakens the labor income share response to trade. The most consistent finding is a negative coefficient on the human capital index, suggesting skill-biased technological change is a more powerful driver of labor share dynamics than trade openness itself.}},
author = {{André, Marcus}},
language = {{eng}},
note = {{Student Paper}},
title = {{Trade Liberalization, Initial Inequality and the Labor Income Share: Evidence from Latin America}},
year = {{2026}},
}