Trade openness and horizontal agricultural income inequality in Korea: focusing on sectoral income differences

In this study, we investigate the impact of agricultural trade openness on horizontal agricultural income inequality in South Korea during the period 1993-2018 using the Kuznets curve hypothesis of the openness-income inequality nexus and autoregressive distributed lag model. We find an inverted-U relationship between agricultural openness and horizontal agricultural income inequality. Further, our results indicate that financial development reduces income inequality within the sub-sectors of agriculture in the country. From these results, the inverted-U relationship between agricultural openness and income inequality should be monitored, and the agricultural sector should be provided with financial support to sustain domestic agricultural production to buffer price volatilities attributed to world agricultural supply shocks.