in Income Disparity and Poverty
World Trade Organization Special Study 5
Geneva: WTO Publications, 11-42, June 2000.

Trade, Growth and Disparity Among Nations

Dan Ben-David
Tel Aviv University,



Evidence is presented on the growing income disparity between countries and on the contribution of international trade in reducing these income differences. Substantial trade liberalization between countries that are the major trade partners of one another is shown to have contributed to a significant reducation in the income gaps that had existed between the countries. The income convergence did not occur prior to the liberalization, nor is convergence a very common feature between countries in general. More generally, it is shown that countries that trade extensively with one another tend to exhibit a much higher incidence of income convergence than countries that do not trade much with each other. And finally, it is shown that the trade-related income convergence was accompanied by faster growth by the liberalizing countries.  


download pdf file
To read or print the .pdf file, you need the Adobe Acrobat Reader, which can be obtained free of charge  from: Adobe.