The nexus between financial globalization and income inequality: the case of emerging market economies

We analyze the causality nexus between financial globalization and income inequality for 19 Emerging Market Economies.We use the bootstrap panel causality analysis. The dataset covers the period 1979-2012. The results indicate that there is apositive causality nexus between financial globalization and income inequality. Also, they show that Granger causality runningfrom financial globalization to income inequality is seen in many countries such as Chile, China, Colombia, Egypt, India,Indonesia, Pakistan, and Singapore while there is Granger causality running from income inequality to financial globalizationin Egypt and Iran. Furthermore, there is bidirectional Granger causality in Malaysia, Philippines, and Thailand. The results arenot consistent with the conventional wisdom.