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The Effect of World Economy on Income Inequality: A Reassessment*
Authors:Steven Stack  Delore Zimmerman
Abstract:The research on the world systems model of income distribution has been marked by some conflicting reports on whether or not periphery status is significantly related to inequality. Writers such as Rubinson argue for the salience of the world-systems model, while authors such as Weede claim that it is insignificant if we include a correctly specified control for level of development. This confusion is based, in part, on a debate over how periphery status should be measured. Previous work has often used measures of questionable validity, such as foreign trade, as a percent of GDP. The present investigation develops a conceptualization of dependency on the world market based on the concentration of export receiving nations. A multiple regression analysis of data from forty-three nations indicates that the index of periphery status does influence indicators of inequality. However, the parabolic model of level of development tends to explain more of the variance in inequality than the world-systems factor. Finally, a control for political democracy gave no support for the political paradigm on inequality.
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