On the relation between foreign direct investment and regional income inequality towards ASEAN's economic integration

This study examines the impacts of foreign direct investment, regional economic integration, and human capital development on regional income inequality in the Association of Southeast Asian Nations. Using panel cointegration and causality techniques, the empirical evidence illustrates that ASEAN's income inequality is sensitive to foreign direct investment, whereas it has no relation to regional economic integration and human capital. Moreover, to achieve the equitable development in ASEAN, the slow-but-sure policy on regional complementarity will alleviate the economic development gap across ASEAN countries rather than the competitive policy with fast-and-furious.