The Social Impact of Globalisation in the Developing Countries

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 HeckscherOhlin/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 withincountry 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. JEL classification system: F02, O1