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Changing nature of North-South linkages: Stylized facts and explanations

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AkIn, Cigdem
Kose, M. Ayhan

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Abstract

This paper examines the changing nature of growth spillovers between developed economies, the North, and developing countries, the South, driven by the process of globalization--the phenomenon of rising international trade and financial flows. We use a comprehensive database of macroeconomic and sectoral variables for 106 countries over the period 1960-2005. We consider the South to be composed of two groups of countries, the Emerging South and the Developing South, based on the extent of their integration into the global economy. Using a panel regression framework, we find that the impact of the Northern economic activity on the Emerging South has declined during the globalization period (1986-2005). In contrast, the growth linkages between the North and Developing South have been rather stable over time. Our findings also suggest that the North and Emerging South economies have started to exhibit more intensive intra-group growth spillovers.

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File URL: http://www.sciencedirect.com/science/article/B6W53-4RC2NNF-1/1/0431d2c897e04b25967656f4d8dcc689
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Publisher Info
Article provided by Elsevier in its journal Journal of Asian Economics.

Volume (Year): 19 (2008)
Issue (Month): 1 (February)
Pages: 1-28
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Handle: RePEc:eee:asieco:v:19:y:2008:i:1:p:1-28

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  1. Kose, M. Ayhan & Otrok, Christopher M. & Prasad, Eswar S., 2008. "Global business cycles: convergence or decoupling?," Discussion Paper Series 1: Economic Studies 2008,17, Deutsche Bundesbank, Research Centre. [Downloadable!]
    Other versions:
  2. Ana Cristina Molina and Marco Fugazza, 2009. "The determinants of trade survival," HEI Working Papers 05-2009, Economics Section, The Graduate Institute of International Studies, revised Jun 2009. [Downloadable!]
  3. Shruthi Jayaram, 2009. "Examining the Decoupling Hypothesis for India," Working Papers id:2119, esocialsciences.com. [Downloadable!]
  4. Jarko Fidrmuc & Iikka Korhonen, 2009. "The Impact of the Global Financial Crisis on Business Cycles in Asian Emerging Economies," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
    Other versions:
  5. Kim, Soyoung & Lee, Jong-Wha & Park, Cyn-Young, 2009. "Emerging Asia: Decoupling or Recoupling," Working Papers on Regional Economic Integration 31, Asian Development Bank. [Downloadable!]
  6. Nadeem Ilahi & Riham Shendy, 2008. "Do the Gulf Oil-Producing Countries Influence Regional Growth? the Impact of Financial and Remittance Flows," IMF Working Papers 08/167, International Monetary Fund. [Downloadable!]
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