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THE NEW AGE STABILIZER? EXPLORING THE RELATIONSHIP BETWEEN DIGITALIZATION AND INCOME INEQUALITY

Year 2024, Issue: 26, 1400 - 1423, 01.10.2024
https://doi.org/10.21441/sosyalguvence.1507517

Abstract

This study aims to improve the understanding of the relationship between digitalization and income inequality through prominent digitalization indicators for countries with different income levels between 2005 and 2020. Digitalization has become an important component of modern economies and societies, facilitating access to information, increasing productivity and supporting economic growth. However, the effects of digitalization on income inequality need to be analyzed in more depth. The study analyzes 39 high-income and 26 middle-income countries using various panel regression estimators. The effects of the variables used to represent digitalization differed according to the samples. According to the findings of the study, an increase in internet usage 100 people was associated with lower Gini coefficient values at all levels. In addition, the use of mobile subscriptions 100 people reduced income inequality at the global level and in the group of high-income countries. The results showed that digitalization had a negative impact on income inequality.

References

  • Ali, M. A., Alam, K., Taylor, B. & Rafiq, S. (2019). Do income distribution and socio-economic inequality affect ICT affordability? Evidence from Australian household panel data, Economic Analysis and Policy, 64, 317-328.
  • Asongu, S. A. & Odhiambo, N. M. (2019). How enhancing information and communication technology has affected inequality in Africa for sustainable development: An empirical investigation, Sustainable Development, 27(4), 647-656. doi:10.1002/sd.1929
  • Asteriou, D., Dimelis, S. & Moudatsou, A. (2014). Globalization and income inequality: A panel data econometric approach for the EU27 countries, Economic Modelling, 36, 592-599. doi:10.1016/j.econmod.2013.09.051
  • Baltagi, B. H. (2005). Econometric Analysis of Panel Data, 3rd Edition, John Wiley & Sons, New York.
  • Bauer, J. M. (2016). The Internet and income inequality: Socio-economic challenges in a hyperconnected society, Telecommunications Policy, 42(4), 333-343. https://doi.org/10.1016/j.telpol.2017.05.009
  • Bell, E., Bryman, A. & Harley, B. (2022). Business Research Methods. Oxford University Press.
  • Canh, P. N., Schinckus, C. & Thanh, S. D. (2020). Effects of the internet, mobile, and land phones on income inequality and The Kuznets curve: Cross country analysis, Telecommunications Policy, 44, 1-15. https://doi.org/10.1016/j.telpol.2020.102041
  • Celbis, M. G. & de Crombrugghe, D. (2018). Internet infrastructure and regional convergence: Evidence from Turkey, Papers in Regional Science, 97(2), 387-409. doi:10.1111/pirs.12244
  • Cioacă, S.-I., Cristache, S.-E., Vuță, M., Marin, E. & Vuță, M. (2020). Assessing the Impact of ICT Sector on Sustainable Development in the European Union: An Empirical Analysis Using Panel Data, Sustainability, 12(2), 1-16. doi:10.3390/su12020592
  • Consoli, D., Castellacci, F. & Santoalha, A. (2023). E-skills and income inequality within European regions, Industry and Innovation, 1-28. doi:10.1080/13662716.2023.2230222
  • Das, S. & Chatterjee, A. (2023). Impacts of ICT and digital finance on poverty and income inequality: a sub-national study from India, Information Technology for Development, 1-28. doi:10.1080/02681102.2022.2151556
  • Daud, S. N. M., Ahmad, A. H. & Ngah, W. A. S. W. (2020). Financialization, Digital Technology and Income Inequality, Applied Economics Letters, doi: 10.1080/13504851.2020.1808165
  • Dikmen, N. (2018). Ekonometriye Giriş, Seçkin Yayıncılık, 4. Baskı, Mart 2018.
  • Dorn, F., Fuest, C. & Potrafke, N. (2022). Trade openness and income inequality: New empirical evidence, Economic Inquiry, 60(1), 202-223. doi:10.1111/ecin.13018
  • Dossou, T., Kambaye, E., Berhe, M. & Asongu, S., (2023). Moderating effect of ICT on the relationship between governance quality and income inequality in sub-Saharan Africa, No 23/021, Working Papers, European Xtramile Centre of African Studies (EXCAS).
  • Edmondson, A. C. & McManus, S. E. (2007). Methodological fit in management field Research, Academy of Management Review, 32(4), 1246-1264.
  • Faizah, C., Yamada, K. & Pratomo, D. S. (2021). Information and communication technology, inequality change and regional development in Indonesia, Journal of Socioeconomics and Development , 4(2):224, doi: 10.31328/jsed.v4i2.2669
  • Fazaalloh, A. M. (2019). Is foreign direct investment helpful to reduce income inequality in Indonesia?, Economics & Sociology, 12(3), 25-36. doi:10.14254/2071-789x.2019/12-3/2
  • Fiedler, P., Fidrmuc, J. & Reck F., (2021). Automation, Digitalization, and Income Inequality in Europe, Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, 71(3), 203-219.
  • Georges V. H. & Julienne, L. (2021). Broadband Internet and Income Inequality, Review of Network Economics, De Gruyter, 20(2), 55-99.
  • Gozgor G. & Ranjan, P. (2017). Globalisation, inequality and redistribution: Theory and evidence, The World Economy, Wiley Blackwell, 40(12), 2704-2751.
  • Guellec, D. & Paunov, C. (2017). Digital Innovation and the Distribution of Income. doi:10.3386/w23987
  • Gujarati, D. N. (2022). Basic Econometrics, Prentice Hall.
  • Güriş, S. (2018). Uygulamalı Panel Veri Ekonometrisi, Der Yayınları.
  • Huynh, C. M. (2021). Foreign direct investment and income inequality: Does institutional quality matter?, The Journal of International Trade & Economic Development, 30(8), 1231-1243. doi:10.1080/09638199.2021.1942164
  • Jaumotte, F., Lall, S. & Papageorgiou, C. (2008). Rising Income Inequality: Technology, or Trade and Financial Globalization?, IMF Working Paper, WP/08/185.
  • Jęchorek, B. W. & Kuzmar, S. (2023). Income Inequalities in the Accelerating Digital Era: Evidence from EU Countries and COVID-Time, Panoeconomicus, 70(4):551-572
  • Law, S. H., Naseem, N. A. M., Lau, W. T. & Trinugroho, I.. (2020). Can innovation improve income inequality? Evidence from panel data, Economic Systems, 44(4), 100815. doi:10.1016/j.ecosys.2020.100815
  • Ma, X. (2022). Internet use and income gaps between rural and urban residents in China, Journal of the Asia Pacific Economy, 1-21. doi:10.1080/13547860.2022.2054133
  • Nguyen, V. B. (2022). Does Digitalization Widen Income Inequality? A Comparative Assessment for Advanced and Developing Economies, South East European Journal of Economics and Business, 17(2), 154-171. doi:10.2478/jeb-2022-0021
  • Nguyen, V. B. (2023). The Role of Digitalization in The FDI –Income Inequality Relationship in Developed and Developing Countries, Journal of Economics, Finance and Administrative Science, 1-21.
  • Njangang, H., Beleck, A., Tadadjeu, S. & Kamguia, B. (2021). Do ICTs drive wealth inequality? Evidence from a dynamic panel analysis, Working Papers of the African Governance and Development Institute. 21/057, African Governance and Development Institute.
  • Richmond, K. & Triplett, R. E. (2017). ICT and income inequality: a cross-national perspective, International Review of Applied Economics, 32(2), 195-214. doi:10.1080/02692171.2017.1338677
  • Shah, C. S. & Krishnan, S. (2023). ICT, Gender Inequality, and Income Inequality: A Panel Data Analysis Across Countries, Inf Syst Front, 1-19. doi:10.1007/s10796-023-10396-4
  • Tchamyou, V. S., Erreygers, G. & Cassimon, D. (2019). Inequality, ICT and financial access in Africa, Technological Forecasting and Social Change, 139, 169-184. doi:10.1016/j.techfore.2018.11.004
  • Wu, J.-Y. & Hsu, C. C. (2012). Foreign direct investment and income inequality: Does the relationship vary with absorptive capacity?, Economic Modelling, 29(6), 2183-2189. doi:10.1016/j.econmod.2012.06.013
  • Yao, L. & Ma, X. (2022). Has digital finance widened the income gap?, PLoS One, 17(2), 1-20. e0263915. doi:10.1371/journal.pone.0263915
  • Yin, Z. H. & Choi, C. H. (2021). Has the Internet increased FDI, economic growth, and trade? Evidence from Asian economies, Information Development, 38(2), 192-203. doi:10.1177/0266666921999749

YENİ ÇAĞIN DENGELEYİCİSİ? GELİR EŞİTSİZLİĞİ VE DİJİTALLEŞME ARASINDAKİ İLİŞKİYİ KEŞFETMEK

Year 2024, Issue: 26, 1400 - 1423, 01.10.2024
https://doi.org/10.21441/sosyalguvence.1507517

Abstract

Bu çalışma, 2005-2020 yılları arasında farklı gelir düzeylerine sahip ülkeler için öne çıkan dijitalleşme göstergeleri aracılığıyla dijitalleşme ve gelir eşitsizliği arasındaki ilişkinin anlaşılmasını geliştirmeyi amaçlamaktadır. Dijitalleşme, modern ekonomilerin ve toplumların önemli bir bileşeni haline gelmiş olup, bilgiye erişimi kolaylaştırmakta, verimliliği artırmakta ve ekonomik büyümeyi desteklemektedir. Ancak, dijitalleşmenin gelir eşitsizliği üzerindeki etkileri hakkında daha derinlemesine bilgi sahibi olmak gerekmektedir. Çalışma kapsamında 39 yüksek gelirli ve 26 orta gelirli ülke için çeşitli panel regresyon tahmincileri üzerinden analizler gerçekleştirilmiştir. Dijitalleşmeyi temsilen kullanılan değişkenlerin etkileri örneklemlere göre farklılık göstermektedir. Her 100 kişi başına internet kullanımında yaşanan artış, tüm düzeylerde daha düşük Gini katsayısı değerleriyle ilişkilidir. Ayrıca her 100 kişi başına mobil abonelik kullanımı, küresel düzeyde ve yüksek gelirli ülkeler grubunda gelir eşitsizliğini azaltmaktadır. Ulaşılan sonuçlar, dijitalleşmenin gelir eşitsizliği üzerinde negatif bir etkiye sahip olduğunu göstermektedir.

References

  • Ali, M. A., Alam, K., Taylor, B. & Rafiq, S. (2019). Do income distribution and socio-economic inequality affect ICT affordability? Evidence from Australian household panel data, Economic Analysis and Policy, 64, 317-328.
  • Asongu, S. A. & Odhiambo, N. M. (2019). How enhancing information and communication technology has affected inequality in Africa for sustainable development: An empirical investigation, Sustainable Development, 27(4), 647-656. doi:10.1002/sd.1929
  • Asteriou, D., Dimelis, S. & Moudatsou, A. (2014). Globalization and income inequality: A panel data econometric approach for the EU27 countries, Economic Modelling, 36, 592-599. doi:10.1016/j.econmod.2013.09.051
  • Baltagi, B. H. (2005). Econometric Analysis of Panel Data, 3rd Edition, John Wiley & Sons, New York.
  • Bauer, J. M. (2016). The Internet and income inequality: Socio-economic challenges in a hyperconnected society, Telecommunications Policy, 42(4), 333-343. https://doi.org/10.1016/j.telpol.2017.05.009
  • Bell, E., Bryman, A. & Harley, B. (2022). Business Research Methods. Oxford University Press.
  • Canh, P. N., Schinckus, C. & Thanh, S. D. (2020). Effects of the internet, mobile, and land phones on income inequality and The Kuznets curve: Cross country analysis, Telecommunications Policy, 44, 1-15. https://doi.org/10.1016/j.telpol.2020.102041
  • Celbis, M. G. & de Crombrugghe, D. (2018). Internet infrastructure and regional convergence: Evidence from Turkey, Papers in Regional Science, 97(2), 387-409. doi:10.1111/pirs.12244
  • Cioacă, S.-I., Cristache, S.-E., Vuță, M., Marin, E. & Vuță, M. (2020). Assessing the Impact of ICT Sector on Sustainable Development in the European Union: An Empirical Analysis Using Panel Data, Sustainability, 12(2), 1-16. doi:10.3390/su12020592
  • Consoli, D., Castellacci, F. & Santoalha, A. (2023). E-skills and income inequality within European regions, Industry and Innovation, 1-28. doi:10.1080/13662716.2023.2230222
  • Das, S. & Chatterjee, A. (2023). Impacts of ICT and digital finance on poverty and income inequality: a sub-national study from India, Information Technology for Development, 1-28. doi:10.1080/02681102.2022.2151556
  • Daud, S. N. M., Ahmad, A. H. & Ngah, W. A. S. W. (2020). Financialization, Digital Technology and Income Inequality, Applied Economics Letters, doi: 10.1080/13504851.2020.1808165
  • Dikmen, N. (2018). Ekonometriye Giriş, Seçkin Yayıncılık, 4. Baskı, Mart 2018.
  • Dorn, F., Fuest, C. & Potrafke, N. (2022). Trade openness and income inequality: New empirical evidence, Economic Inquiry, 60(1), 202-223. doi:10.1111/ecin.13018
  • Dossou, T., Kambaye, E., Berhe, M. & Asongu, S., (2023). Moderating effect of ICT on the relationship between governance quality and income inequality in sub-Saharan Africa, No 23/021, Working Papers, European Xtramile Centre of African Studies (EXCAS).
  • Edmondson, A. C. & McManus, S. E. (2007). Methodological fit in management field Research, Academy of Management Review, 32(4), 1246-1264.
  • Faizah, C., Yamada, K. & Pratomo, D. S. (2021). Information and communication technology, inequality change and regional development in Indonesia, Journal of Socioeconomics and Development , 4(2):224, doi: 10.31328/jsed.v4i2.2669
  • Fazaalloh, A. M. (2019). Is foreign direct investment helpful to reduce income inequality in Indonesia?, Economics & Sociology, 12(3), 25-36. doi:10.14254/2071-789x.2019/12-3/2
  • Fiedler, P., Fidrmuc, J. & Reck F., (2021). Automation, Digitalization, and Income Inequality in Europe, Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, 71(3), 203-219.
  • Georges V. H. & Julienne, L. (2021). Broadband Internet and Income Inequality, Review of Network Economics, De Gruyter, 20(2), 55-99.
  • Gozgor G. & Ranjan, P. (2017). Globalisation, inequality and redistribution: Theory and evidence, The World Economy, Wiley Blackwell, 40(12), 2704-2751.
  • Guellec, D. & Paunov, C. (2017). Digital Innovation and the Distribution of Income. doi:10.3386/w23987
  • Gujarati, D. N. (2022). Basic Econometrics, Prentice Hall.
  • Güriş, S. (2018). Uygulamalı Panel Veri Ekonometrisi, Der Yayınları.
  • Huynh, C. M. (2021). Foreign direct investment and income inequality: Does institutional quality matter?, The Journal of International Trade & Economic Development, 30(8), 1231-1243. doi:10.1080/09638199.2021.1942164
  • Jaumotte, F., Lall, S. & Papageorgiou, C. (2008). Rising Income Inequality: Technology, or Trade and Financial Globalization?, IMF Working Paper, WP/08/185.
  • Jęchorek, B. W. & Kuzmar, S. (2023). Income Inequalities in the Accelerating Digital Era: Evidence from EU Countries and COVID-Time, Panoeconomicus, 70(4):551-572
  • Law, S. H., Naseem, N. A. M., Lau, W. T. & Trinugroho, I.. (2020). Can innovation improve income inequality? Evidence from panel data, Economic Systems, 44(4), 100815. doi:10.1016/j.ecosys.2020.100815
  • Ma, X. (2022). Internet use and income gaps between rural and urban residents in China, Journal of the Asia Pacific Economy, 1-21. doi:10.1080/13547860.2022.2054133
  • Nguyen, V. B. (2022). Does Digitalization Widen Income Inequality? A Comparative Assessment for Advanced and Developing Economies, South East European Journal of Economics and Business, 17(2), 154-171. doi:10.2478/jeb-2022-0021
  • Nguyen, V. B. (2023). The Role of Digitalization in The FDI –Income Inequality Relationship in Developed and Developing Countries, Journal of Economics, Finance and Administrative Science, 1-21.
  • Njangang, H., Beleck, A., Tadadjeu, S. & Kamguia, B. (2021). Do ICTs drive wealth inequality? Evidence from a dynamic panel analysis, Working Papers of the African Governance and Development Institute. 21/057, African Governance and Development Institute.
  • Richmond, K. & Triplett, R. E. (2017). ICT and income inequality: a cross-national perspective, International Review of Applied Economics, 32(2), 195-214. doi:10.1080/02692171.2017.1338677
  • Shah, C. S. & Krishnan, S. (2023). ICT, Gender Inequality, and Income Inequality: A Panel Data Analysis Across Countries, Inf Syst Front, 1-19. doi:10.1007/s10796-023-10396-4
  • Tchamyou, V. S., Erreygers, G. & Cassimon, D. (2019). Inequality, ICT and financial access in Africa, Technological Forecasting and Social Change, 139, 169-184. doi:10.1016/j.techfore.2018.11.004
  • Wu, J.-Y. & Hsu, C. C. (2012). Foreign direct investment and income inequality: Does the relationship vary with absorptive capacity?, Economic Modelling, 29(6), 2183-2189. doi:10.1016/j.econmod.2012.06.013
  • Yao, L. & Ma, X. (2022). Has digital finance widened the income gap?, PLoS One, 17(2), 1-20. e0263915. doi:10.1371/journal.pone.0263915
  • Yin, Z. H. & Choi, C. H. (2021). Has the Internet increased FDI, economic growth, and trade? Evidence from Asian economies, Information Development, 38(2), 192-203. doi:10.1177/0266666921999749
There are 38 citations in total.

Details

Primary Language Turkish
Subjects Social Policy (Other)
Journal Section Makaleler
Authors

Yusuf Can Çalışır 0000-0001-5715-7269

Kerem Gülen 0009-0002-3758-8736

Publication Date October 1, 2024
Submission Date June 30, 2024
Acceptance Date September 4, 2024
Published in Issue Year 2024 Issue: 26

Cite

APA Çalışır, Y. C., & Gülen, K. (2024). YENİ ÇAĞIN DENGELEYİCİSİ? GELİR EŞİTSİZLİĞİ VE DİJİTALLEŞME ARASINDAKİ İLİŞKİYİ KEŞFETMEK. Sosyal Güvence(26), 1400-1423. https://doi.org/10.21441/sosyalguvence.1507517