Does Globalization Affect Growth?
University of Heidelberg
University of Mannheim Working Paper
The paper presents an index of globalization covering its three main dimensions: Economic integration, social integration, and political integration. Using panel data for 123 countries in 1970-2000 the effects of the overall index of globalization as well as sub-indexes constructed to measure the single dimensions on economic growth are analyzed empirically. The results show that globalization promotes growth - but not to an extent necessary to reduce poverty on a large scale. The dimensions most robustly related with growth refer to actual economic flows and restrictions in developed countries. Although less robustly, information flows also promote growth whereas political integration has no effect.
Number of Pages in PDF File: 33
Keywords: Globalization, Growth
JEL Classification: H77, O57, F43
Date posted: December 16, 2002