Chapter 1: Aspects of Social Dividend and Sustainable Development Goals in a Globalized World: A Theoretical Foundation

In an increasingly globalized world, the interplay between social dividends and the sustainable development goals (SDGs) has become crucial for shaping economic policies. This chapter provides a theoretical foundation to analyze these aspects within the framework of general equilibrium trade models, specifically applied to a small open economy. The study explores how various SDGs – such as poverty reduction, inequality mitigation, and environmental sustainability – are influenced by trade policies and social dividend mechanisms. The methodology is centered on general equilibrium trade models, which allow for the examination of market dynamics, factor mobility, and income distribution in an open economy setting. By incorporating social dividends – redistributive mechanisms aimed at ensuring social welfare – the analysis investigates their role in achieving sustainable and inclusive growth. The model captures the effects of globalization on income redistribution, labor markets, and environmental outcomes, providing insights into policy implications for small open economies facing external shocks and trade liberalization. The findings suggest that well-designed social dividend schemes can complement trade policies to enhance social welfare while promoting economic stability. Additionally, the results highlight the importance of policy coordination between trade liberalization and social equity measures to align with the SDGs. This research contributes to the theoretical literature by integrating social dividend considerations within an open economy framework, offering a policy-relevant perspective on achieving sustainable development in a globalized economic environment.