Winners and losers of globalization: Sectoral trade concentration and income inequality

The intensification in globalization processes that has been taking place since the 1990s brought about several implications, among which the configuration of international production into Global Value Chains (GVCs) stands out. Recent literature has stated that, although integration into GVCs usually brings about economic upgrading for countries, an equal social distribution of these impacts cannot be taken for granted. In this sense, recent studies have analyzed the relations between this integration and income inequality. However, whether this global trade is made with several or fewer countries and/or industries has not been included in this kind of analysis. This can have important implications in terms of social outcomes, and a higher concentration of trade can be linked to higher risks in the contemporary context of supply chain disruptions (e.g., due to geopolitical conflicts or global pandemics). Thus, the objective of this paper is to study how the sectoral concentrations of both exports and imports can affect income inequality, measured at both inter- and intra-country levels. Statistical relations can be found, which allows us to relate the outcomes to topics such as productive diversification and comparative advantages in trade.