Inequality, Economic Growth and Trade Openness: a Case Study for Central and Eastern European Countries (ECE)

The paper analyzes the phenomenon of income inequality in ten countries from Eastern and Central Europe (ECE), by highlighting two aspects: (1) the link between growth and income inequality; (2) the effects of trade openess and other key factors on income inequality, such as: foreign direct investment (FDI), market capitalization and educational level of labour force. The method used was the Panel Data Analysis with statistical data from the period of 2000-2014. An increasing effect in income inequality was identified due to the trade openess, the inward stock of ISD and the market capitalization and an equalizing effect in the income distribution generated by the educational level of labour force. A positive association was also found between the growth of PIB per capita level and the increase of income inequality in the examined countries.