The Impact of Sugarcane By-Product Exports on Income Inequality: How Sustainable Is This Relationship?

Abstract

The reduction in income inequality and its convergence between localities is one of the aims of the United Nations Sustainable Development Goals. This work aims to contribute to the theme, researching the relationship among international trade, the export of sugarcane by-products, and income inequality. A panel data regression was performed for a group of 98 cities from the state of Goiás-Brazil. Results indicate that international trade has a minimal, though positive effect, reducing income inequality. Nevertheless, the export of sugarcane by-product results indicates a harmful effect on workers’ income in the poorest cities who work in the agricultural sector. The results indicate that international trade contributes to sustainable development by generating wealth, contributing to UN SDG number 1, and reducing income inequality, helping to achieve UN SDG number 10.