So why is inequality rising in such a broad range of country? In particular, for countries with abundant unskilled labor, opening the economy should raise the wages of unskilled labor and depress the wages for skilled workers and returns to capital, as the country specializes in low-skill production (known as the Stolper-Samuelson theorem)
China should be the classic example of this, with its vast pool of lower skilled labor and labor-intensive manufacturing. But China is the Asian country which has experienced the greatest increase in inequality.
The evidence shows that the main drivers of Asia’s rapid growth --- technological change, globalization and market-oriented reform --- are also the basic forces behind rising inequality in the region. Working together, these have significantly impacted on inequality through a number of channels, in particular: