Advanced Search
MyIDEAS: Login

Convergence or Divergence? The Impacts of Globalisation on Growth and Inequality in Less Developed Countries

Contents:

Author Info

  • Michelle Baddeley

Abstract

This paper assesses the impacts of globalisation on the cross-country comparative patterns of growth and development. In the theoretical section, some of the key linkages between growth, development and globalisation are explored including the positive and negative impacts of globalisation and the constraints on effective development in a globalised world. Some of the key factors emphasised include trade and capital flows as well as computerisation. These issues are then analysed empirically using σ and club convergence models, estimated using panel techniques. The empirical evidence presented indicates that globalisation has been associated with increasing trade and financial flows to less developed countries. It has also coincided with increasing penetration of the Internet suggesting that increases in informational flows have complemented economic and financial linkages, but the empirical evidence also shows that the current era of globalisation has not been associated with convergence in economic outcomes; instead less-developed countries have suffered from increases in international income inequality. In the final section, conclusions and policy implications are presented including a discussion of how international and national development policies could be designed properly to ameliorate tendencies towards growing international disparities in economic growth.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.tandfonline.com/doi/abs/10.1080/02692170600736250
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Taylor & Francis Journals in its journal International Review of Applied Economics.

Volume (Year): 20 (2006)
Issue (Month): 3 ()
Pages: 391-410

as in new window
Handle: RePEc:taf:irapec:v:20:y:2006:i:3:p:391-410

Contact details of provider:
Web page: http://www.tandfonline.com/CIRA20

Order Information:
Web: http://www.tandfonline.com/pricing/journal/CIRA20

Related research

Keywords: Globalisation; growth; development; convergence;

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Luisa Corrado & Ron Martin & Melvyn Weeks, 2005. "Identifying and Interpreting Regional Convergence Clusters across Europe," Economic Journal, Royal Economic Society, vol. 115(502), pages C133-C160, 03.
  2. Steve Dowrick & J. Bradford DeLong, 2003. "Globalization and Convergence," NBER Chapters, in: Globalization in Historical Perspective, pages 191-226 National Bureau of Economic Research, Inc.
  3. René M. Stulz, 2007. "The Limits of Financial Globalization," Journal of Applied Corporate Finance, Morgan Stanley, vol. 19(1), pages 8-15.
  4. Greasley, David & Oxley, Les, 1997. "Time-series based tests of the convergence hypothesis: Some positive results," Economics Letters, Elsevier, vol. 56(2), pages 143-147, October.
  5. Baumol, William J & Wolff, Edward N, 1988. "Productivity Growth, Convergence, and Welfare: Reply," American Economic Review, American Economic Association, vol. 78(5), pages 1155-59, December.
  6. Paul M Romer, 1999. "Increasing Returns and Long-Run Growth," Levine's Working Paper Archive 2232, David K. Levine.
  7. Durlauf,S.N. & Johnson,P.A. & Temple,J.R.W., 2004. "Growth econometrics," Working papers 18, Wisconsin Madison - Social Systems.
    • Durlauf, Steven N. & Johnson, Paul A. & Temple, Jonathan R.W., 2005. "Growth Econometrics," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 8, pages 555-677 Elsevier.
  8. Obstfeld, Maurice, 1998. "The Global Capital Market: Benefactor or Menace?," Center for International and Development Economics Research, Working Paper Series qt3kn3n2s8, Center for International and Development Economics Research, Institute for Business and Economic Research, UC Berkeley.
  9. Wood, Adrian, 1998. "Globalisation and the Rise in Labour Market Inequalities," Economic Journal, Royal Economic Society, vol. 108(450), pages 1463-82, September.
  10. Jesus Felipe & J. S. L. McCombie, 2005. "WHY ARE SOME COUNTRIES RICHER THAN OTHERS? A SKEPTICAL VIEW OF MANKIW-ROMER-WEIL's TEST OF THE NEOCLASSICAL GROWTH MODEL," Metroeconomica, Wiley Blackwell, vol. 56(3), pages 360-392, 07.
  11. Barro, R.J., 1989. "Economic Growth In A Cross Section Of Countries," RCER Working Papers 201, University of Rochester - Center for Economic Research (RCER).
  12. Peter Howitt & David Mayer-Foulkes, 2002. "R&D, Implementation and Stagnation: A Schumpeterian Theory of Convergence Clubs," NBER Working Papers 9104, National Bureau of Economic Research, Inc.
  13. Berthelemy, Jean-Claude & Varoudakis, Aristomene, 1996. "Economic Growth, Convergence Clubs, and the Role of Financial Development," Oxford Economic Papers, Oxford University Press, vol. 48(2), pages 300-328, April.
  14. Kneller, Richard & Andrew Stevens, Philip, 2003. "The specification of the aggregate production function in the presence of inefficiency," Economics Letters, Elsevier, vol. 81(2), pages 223-226, November.
  15. Robert Feenstra, 2003. "Integration Of Trade And Disintegration Of Production In The Global Economy," Working Papers 986, University of California, Davis, Department of Economics.
  16. Bernard, Andrew B & Jones, Charles I, 1996. "Technology and Convergence," Economic Journal, Royal Economic Society, vol. 106(437), pages 1037-44, July.
  17. Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-85, December.
  18. Bernard, Andrew B & Durlauf, Steven N, 1995. "Convergence in International Output," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 10(2), pages 97-108, April-Jun.
  19. Mankiw, N Gregory & Romer, David & Weil, David N, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 107(2), pages 407-37, May.
  20. Branko Milanovic, 2003. "The Two Faces Of Globalization: Against Globalization As We Know It," Development and Comp Systems 0303007, EconWPA.
  21. Harcourt,G. C., 1972. "Some Cambridge Controversies in the Theory of Capital," Cambridge Books, Cambridge University Press, number 9780521096720, October.
  22. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
  23. Dutt, Amitava Krishna & Mukhopadhyay, Kajal, 2005. "Globalization and the inequality among nations: A VAR approach," Economics Letters, Elsevier, vol. 88(3), pages 295-299, September.
  24. Friedman, Milton, 1992. "Do Old Fallacies Ever Die?," Journal of Economic Literature, American Economic Association, vol. 30(4), pages 2129-32, December.
  25. Ajit Singh, 2002. "Capital account liberalization, free long-term capital flows, financial crises and economic development," ESRC Centre for Business Research - Working Papers wp245, ESRC Centre for Business Research.
  26. T. W. Swan, 1956. "ECONOMIC GROWTH and CAPITAL ACCUMULATION," The Economic Record, The Economic Society of Australia, vol. 32(2), pages 334-361, November.
  27. Loungani, Prakash, 2005. "In defense of globalization," Journal of International Economics, Elsevier, vol. 66(2), pages 544-548, July.
  28. Jonathan Temple, 1999. "The New Growth Evidence," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 112-156, March.
  29. Gustav Ranis & Frances Stewart & Emma Samman, 2005. "Human Development: Beyond the HDI," Working Papers 916, Economic Growth Center, Yale University.
  30. Galor, Oded, 1996. "Convergence? Inferences from Theoretical Models," Economic Journal, Royal Economic Society, vol. 106(437), pages 1056-69, July.
  31. Swan, Trevor W, 2002. "Economic Growth," The Economic Record, The Economic Society of Australia, vol. 78(243), pages 375-80, December.
  32. Chatterji, Monojit, 1992. "Convergence Clubs and Endogenous Growth," Oxford Review of Economic Policy, Oxford University Press, vol. 8(4), pages 57-69, Winter.
  33. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
  34. Ravallion, Martin, 2004. "Competing concepts of inequality in the globalization debate," Policy Research Working Paper Series 3243, The World Bank.
  35. Peter Howitt, 2000. "Endogenous Growth and Cross-Country Income Differences," American Economic Review, American Economic Association, vol. 90(4), pages 829-846, September.
  36. Bart Hobijn & Philip Hans Franses, 2000. "Asymptotically perfect and relative convergence of productivity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 15(1), pages 59-81.
  37. Kumbhakar, Subal C. & Wang, Hung-Jen, 2005. "Estimation of growth convergence using a stochastic production frontier approach," Economics Letters, Elsevier, vol. 88(3), pages 300-305, September.
  38. Bentzen, Jan, 2005. "Testing for catching-up periods in time-series convergence," Economics Letters, Elsevier, vol. 88(3), pages 323-328, September.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Pitelis, Christos, 2009. "Foreign direct investment and economic integration," MPRA Paper 23938, University Library of Munich, Germany.
  2. Bernard Fingleton & Michelle Catherine Baddeley, 2011. "Globalisation And Wage Differentials: A Spatial Analysis," Manchester School, University of Manchester, vol. 79(5), pages 1018-1034, 09.
  3. Anders, Sven & Caswell, Julie A., 2009. "The Benefits and Costs of Proliferation of Geographical Labeling for Developing Countries," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 10(1).
  4. Schmid, Stefan & Kotulla, Thomas, 2011. "50 years of research on international standardization and adaptation--From a systematic literature analysis to a theoretical framework," International Business Review, Elsevier, vol. 20(5), pages 491-507, October.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:taf:irapec:v:20:y:2006:i:3:p:391-410. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.