Structural change, competition and income distribution

The paper examines the relationship between structural change and income distribution in developing countries. Changes in patterns of trade and technological specialisation were used to identify differences in structural change between countries. To capture this, industries were assigned to four broad categories; low technology, medium-low technology, medium-high technology and high technology industries. The relationship between structural change and income distribution was measured by Gini coefficients. The findings show the effects of structural change on income distribution vary across industry categories and industries that have the highest impact on growth have the greatest potential for worsening income distribution in developing countries.