@TechReport{iza:izadps:dp1925, author={Lee, Eddy and Vivarelli, Marco}, title={The Social Impact of Globalization in the Developing Countries}, year={2006}, month={Jan}, institution={Institute of Labor Economics (IZA)}, address={Bonn}, type={IZA Discussion Paper}, number={1925}, url={https://www.iza.org/publications/dp1925}, abstract={In this paper an ex-post measurable definition of globalization has been used, namely increasing trade openness and FDI. A general result is that the optimistic Heckscher-Ohlin/Stolper-Samuelson predictions do not apply, that is neither employment creation nor the decrease in within-country inequality are automatically assured by increasing trade and FDI. The other main findings of the paper are that: 1) the employment effect can be very diverse in different areas of the world, giving raise to concentration and marginalisation phenomena; 2) increasing trade and FDI do not emerge as the main culprits of increasing within-country income inequality in DCs, although some evidence emerges that import of capital goods may imply an increase in inequality via skill-biased technological change; 3)increasing trade seems to foster economic growth and absolute poverty alleviation, although some important counter-examples emerge.}, keywords={within-country income inequality;trade;FDI;employment;poverty}, }