Investigating Relationship between Trade and Income Inequalities

This paper investigates the relationship between trade and regional income inequalities in the period 2001-2010 using panel data for 18 selected developing countries. The results show that trade has a significant and negative effect on regional income inequalities, so that an increase of 1 percent of its value, regional income inequalities 0.09 percent decrease. Also, GDP per capita has a negative impact on regional income inequalities in studied countries. However, the population and agriculture value added have a positive effect on regional income inequalities. It can be said that a 1 percent increase in the variables, respectively, regional income inequalities 0.16 and 0.21 increased.