Anwar, Sajid, and Sun, Sizhong (2025) Outward FDI and income inequality in the home country: The role of wage bargaining. International Review of Economics & Finance, 101. 104166.

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Abstract

In the process of economic globalization, firms extending operations via Foreign Direct Investment (FDI) encounter significant effects on wage inequality. Workers with bargaining power can negotiate favorable terms, while those without this influence face pronounced disparities. Building on the framework of Helpman et al. (2010), this study examines the impact of non-bargaining workers on income inequality during the transition from autarky to outward FDI. The results highlight a marked increase in wage gaps, particularly with greater outward FDI intensity. Moreover, under certain conditions, there is a notable rise in overall inequality, as measured by the Theil index.

Item ID:	86644
Item Type:	Article (Research - C1)
ISSN:	1873-8036
Keywords:	Outward FDI; Wage income inequality; Globalization; Wage bargaining
Copyright Information:	© 2025 Published by Elsevier Inc. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/).
Date Deposited:	13 Aug 2025 02:27
FoR Codes:	38 ECONOMICS > 3801 Applied economics > 380110 International economics @ 50% 38 ECONOMICS > 3803 Economic theory > 380304 Microeconomic theory @ 50%
SEO Codes:	15 ECONOMIC FRAMEWORK > 1505 Microeconomics > 150507 Micro labour market issues @ 100%
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