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Is Globalization Reducing Absolute Poverty?

Listed author(s):
  • Bergh, Andreas
  • Nilsson, Therese

Using data from 114 countries (1983–2007), we examine the relationship between globalization and World Bank absolute poverty estimates. We find a significant negative correlation between globalization and poverty, robust to several econometric specifications, including a fixed-effect panel—a “long run” first difference—and a pooled OLS-regression. Introducing two instruments for globalization we also show that results are robust to correction for potential endogeneity. We motivate and test the instruments in several ways. In particular information flows and more liberal trade restrictions robustly correlate with lower absolute poverty.

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File URL: http://www.sciencedirect.com/science/article/pii/S0305750X14001065
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Article provided by Elsevier in its journal World Development.

Volume (Year): 62 (2014)
Issue (Month): C ()
Pages: 42-61

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Handle: RePEc:eee:wdevel:v:62:y:2014:i:c:p:42-61
DOI: 10.1016/j.worlddev.2014.04.007
Contact details of provider: Web page: http://www.elsevier.com/locate/worlddev

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