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"Core" and "Periphery" in the World Economy: An Empirical Assessment of the Dependence of Third World Growth on the Developed Countries

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  • Julius Horvath

    (Southern Illinois University at Carbondale)

  • Richard Grabowski

    (Southern Illinois University at Carbondale)

Abstract

This paper classifies the relationship between the developed and developing countries into three categories: strong dependency, weak dependency and independence of the developing country on the developed world (G-7). A country is characterized as strongly (weakly) dependent when it has a negative (positive) response to permanent shocks originating from the center and the weight of these shocks is relatively important in explaining total variation in the output of the developing country. Independence is characterized with low weight of shocks from the center. The results of a dynamic vector autoregressive model suggest that from the sample of 86 developed countries only five of them could be considered strongly dependent, while the others are roughly divided equally into weakly dependent and independent.

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Bibliographic Info

Paper provided by EconWPA in its series Development and Comp Systems with number 9609002.

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Length: 30 pages
Date of creation: 26 Sep 1996
Date of revision: 30 Sep 1996
Handle: RePEc:wpa:wuwpdc:9609002

Note: Type of Document - WordPerfect; prepared on IBM PC; to print on HP III; pages: 30; figures: none. Single binary WordPerfect 5.1 for DOS file uploaded with Netscape 2.02. See SIUC's entire list of working papers at http://www.siu.edu/departments/cola/econ/discpapr.html.
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  1. Bayoumi, Tamim & Eichengreen, Barry, 1992. "Shocking Aspects of Monetary Unification," Department of Economics, Working Paper Series qt791143kp, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
  2. Bayoumi, Tamim & Eichengreen, Barry, 1992. "Shocking Aspects of European Monetary Unification," CEPR Discussion Papers 643, C.E.P.R. Discussion Papers.
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