IDEAS home Printed from https://ideas.repec.org/a/wly/sustdv/v34y2026i2p2536-2557.html

Macroenvironmental Drivers of Poverty in Developing Countries: Rethinking the Globalization–Sustainable Development Nexus

Author

Listed:
  • Sodiq Olaide Bisiriyu
  • Manzoor Hassan Malik

Abstract

The study addresses the critical problem of examining the macroenvironmental drivers of poverty in developing countries, focusing on how social, economic, political, and technological factors moderate globalization's impact on poverty outcomes. Using unbalanced panel data from 25 developing countries across Africa, Asia, Europe, North America, and South America from 2000 to 2021, we employ fixed‐effects generalized least squares (FE‐GLS) and system generalized method of moments (GMM) estimators to analyze the globalization–poverty nexus. The model incorporates religious freedom, geopolitical tension, economic policy uncertainty, and digitalization as moderating factors. The results indicate that while globalization broadly reduces poverty, its impact is conditional on the macroenvironment. Economic policy uncertainty positively and significantly moderates the relationship, indicating that globalization may exacerbate poverty during intensified policy volatility. Similarly, the moderating effect of internet use is positive and significant, revealing a digital divide where unequal access to digitalization heightens vulnerability among the poor. Other macroenvironmental factors, religious freedom, geopolitical tension, and fixed broadband subscription also exert positive but statistically insignificant influence on the globalization–poverty nexus. Furthermore, our results indicate that economic growth significantly reduces the poverty gap but not the headcount ratio, highlighting that growth alone is insufficient for lifting households above the poverty line, especially with the prevalence of the poverty trap. The result further underscores the importance of human capital in enabling individuals to harness globalization benefits. Overall, the study highlights that macroenvironmental conditions shape how globalization influences poverty and offers actionable policy insights for sustainable and inclusive development in developing countries.

Suggested Citation

  • Sodiq Olaide Bisiriyu & Manzoor Hassan Malik, 2026. "Macroenvironmental Drivers of Poverty in Developing Countries: Rethinking the Globalization–Sustainable Development Nexus," Sustainable Development, John Wiley & Sons, Ltd., vol. 34(2), pages 2536-2557, April.
  • Handle: RePEc:wly:sustdv:v:34:y:2026:i:2:p:2536-2557
    DOI: 10.1002/sd.70471
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/sd.70471
    Download Restriction: no

    File URL: https://libkey.io/10.1002/sd.70471?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Salvatore, Dominick, 2007. "Growth, international inequalities, and poverty in a globalizing world," Journal of Policy Modeling, Elsevier, vol. 29(4), pages 635-641.
    2. Nissanke, Machiko & Thorbecke, Erik, 2006. "Channels and policy debate in the globalization-inequality-poverty nexus," World Development, Elsevier, vol. 34(8), pages 1338-1360, August.
    3. Shreya Pal, 2024. "Do economic globalization and the level of education impede poverty levels? A non-linear ARDL approach," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 22(3), pages 621-667, September.
    4. Md Abu Hasan, 2019. "Does globalization accelerate economic growth? South Asian experience using panel data," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 8(1), pages 1-13, December.
    5. Atta Ullah & Zhao Kui & Saif Ullah & Chen Pinglu & Saba Khan, 2021. "Sustainable Utilization of Financial and Institutional Resources in Reducing Income Inequality and Poverty," Sustainability, MDPI, vol. 13(3), pages 1-25, January.
    6. Jinjin Zhang & Zixuan Li & Arshad Ali & Jinshu Wang, 2023. "Does globalization matter in the relationship between renewable energy consumption and economic growth, evidence from Asian emerging economies," PLOS ONE, Public Library of Science, vol. 18(8), pages 1-25, August.
    7. Ofori, Isaac K. & Armah, Mark K. & Taale, Francis & Ofori, Pamela E., 2021. "Addressing the Severity and Intensity of Poverty in Sub-Saharan Africa: How Relevant is the ICT and Financial Development Pathway?," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, issue forthcomi.
    8. Basu, Kaushik, 2006. "Globalization, poverty, and inequality: What is the relationship? What can be done?," World Development, Elsevier, vol. 34(8), pages 1361-1373, August.
    9. Ayesha Afzal & Saba Fazal Firdousi & Ayma Waqar & Minahil Awais, 2022. "The Influence of Internet Penetration on Poverty and Income Inequality," SAGE Open, , vol. 12(3), pages 21582440221, August.
    10. Katikar Tipayalai & Chayaton Subchavaroj, 2024. "Assessing the spatial impact of educational attainment on poverty reduction in Thailand," Education Economics, Taylor & Francis Journals, vol. 32(4), pages 538-555, July.
    11. Miet Maertens & Liesbeth Colen & Johan F. M. Swinnen, 2011. "Globalisation and poverty in Senegal: a worst case scenario?," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 38(1), pages 31-54, March.
    12. Pam Zahonogo, 2017. "Financial Development and Poverty in Developing Countries: Evidence from Sub-Saharan Africa," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 9(1), pages 211-220, January.
    13. Emmanuel Amissah & Katarzyna Świerczyńska, 2021. "Is Religion a Determinant of Financial Development?," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 27(3), pages 233-247, August.
    14. Edmore Mahembe & Nicholas Mbaya Odhiambo, 2021. "Does foreign aid reduce poverty? A dynamic panel data analysis for sub-Saharan African countries," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(4), pages 875-893, December.
    15. David Dollar, 2005. "Globalization, Poverty, and Inequality since 1980," The World Bank Research Observer, World Bank, vol. 20(2), pages 145-175.
    16. Waliu Olawale Shittu & Hammed Agboola Yusuf & Abdallah El Moctar El Houssein & Sallahuddin Hassan, 2020. "The impacts of foreign direct investment and globalisation on economic growth in West Africa: examining the role of political governance," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 47(7), pages 1733-1755, May.
    17. Ann Harrison & Margaret McMillan, 2007. "On the links between globalization and poverty," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 5(1), pages 123-134, April.
    18. The World Bank, 2022. "Poverty and Shared Prosperity 2022: Correcting Course," Post-Print hal-05130118, HAL.
    19. Zhang, Huafeng, 2014. "The poverty trap of education: Education–poverty connections in Western China," International Journal of Educational Development, Elsevier, vol. 38(C), pages 47-58.
    20. Gene M. Grossman & Esteban Rossi-Hansberg, 2008. "Trading Tasks: A Simple Theory of Offshoring," American Economic Review, American Economic Association, vol. 98(5), pages 1978-1997, December.
    21. Volkan Han & Oguz Ocal & Alper Aslan, 2023. "A revisit to the relationship between globalization and income inequality: are levels of development really paramount?," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(1), pages 973-990, February.
    22. Laurence R. Iannaccone, 1998. "Corrigenda [Introduction to the Economics of Religion]," Journal of Economic Literature, American Economic Association, vol. 36(4), pages 1941-1941, December.
    23. Md. Sabbir Hossain & Md. Golam Kibria & Md. Shafiqul Islam, 2018. "Does Globalization Affect the Economic Growth of Bangladesh? - An Econometric Analysis," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 8(12), pages 1384-1393, December.
    24. Nissanke, Machiko & Thorbecke, Erik, 2010. "Globalization, Poverty, and Inequality in Latin America: Findings from Case Studies," World Development, Elsevier, vol. 38(6), pages 797-802, June.
    25. Feng, Dawei & Gao, Mengtao & Zhou, Li, 2023. "Religion and household borrowing: Evidence from China," International Review of Economics & Finance, Elsevier, vol. 88(C), pages 60-72.
    26. Hammudeh, Shawkat & Sohag, Kazi & Husain, Shaiara & Husain, Humaira & Said, Jamaliah, 2020. "Nonlinear relationship between economic growth and nuances of globalisation with income stratification: Roles of financial development and governance," Economic Systems, Elsevier, vol. 44(3).
    27. Parisa Samimi & Hashem Salarzadeh Jenatabadi, 2014. "Globalization and Economic Growth: Empirical Evidence on the Role of Complementarities," PLOS ONE, Public Library of Science, vol. 9(4), pages 1-7, April.
    28. Hofmarcher, Thomas, 2021. "The effect of education on poverty: A European perspective," Economics of Education Review, Elsevier, vol. 83(C).
    29. Tongjin Zhang & Yuan Zhang & Guanghua Wan & Haitao Wu, 2020. "Poverty Reduction In China And India: A Comparative Study," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 65(supp01), pages 95-115, December.
    30. Ravindra Deyshappria, 2018. "Globalization-Poverty Nexuses: Evidences from Cross-Country Analysis," Empirical Economic Review, Department of Economics and Statistics, Dr Hassan Murad School of Management, University of Management and Technology, Lahore, vol. 1(1), pages 25-48.
    31. World Bank, 2022. "Poverty and Shared Prosperity 2022," World Bank Publications - Books, The World Bank Group, number 37739, April.
    32. Wolfgang Drobetz & Konstantinos Gavriilidis & Styliani-Iris Krokida & Dimitris Tsouknidis, 2021. "The effects of geopolitical risk and economic policy uncertainty on dry bulk shipping freight rates," Applied Economics, Taylor & Francis Journals, vol. 53(19), pages 2218-2229, April.
    33. Mohammed Abubakar, 2024. "Globalisation and Output Growth Nexus in Sub-Saharan Africa: the Critical Role of Trade Liberalisation," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 2218-2240, March.
    34. Hodabalo BATAKA, 2019. "De jure, De facto Globalization and Economic Growth in Sub-Saharan Africa," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 34(1), pages 133-158.
    35. Salvatore, Dominick, 2004. "Growth and poverty in a globalizing world," Journal of Policy Modeling, Elsevier, vol. 26(4), pages 543-551, June.
    36. Hrushikesh Mallick & Mantu Kumar Mahalik & Hemachandra Padhan, 2020. "Does globalization exacerbate income inequality in two largest emerging economies? The role of FDI and remittances inflows," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 67(4), pages 443-480, December.
    37. Oruj Gasimli & Ihtisham ul Haq & Shahid Munir & Muhammad Hasnain Khalid & Sisira Kumara Naradda Gamage & Alam Khan & Muhammad Ishtiaq, 2022. "Globalization and Sustainable Development: Empirical Evidence from CIS Countries," Sustainability, MDPI, vol. 14(22), pages 1-15, November.
    38. Muhammad Shahid Hassan & Samra Bukhari & Noman Arshed, 2020. "Competitiveness, governance and globalization: What matters for poverty alleviation?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(4), pages 3491-3518, April.
    39. Md Aslam Mia & Md Imran Hossain & Sunil Sangwan, 2024. "Determinants of digitalization: Evidence from Asia and the Pacific countries," Digital Transformation and Society, Emerald Group Publishing Limited, vol. 3(4), pages 340-358, March.
    40. Ibrahim F. Akoum, 2008. "Globalization, growth, and poverty: the missing link," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 35(4), pages 226-238, March.
    41. Axel Dreher, 2006. "Does globalization affect growth? Evidence from a new index of globalization," Applied Economics, Taylor & Francis Journals, vol. 38(10), pages 1091-1110.
    42. Davide Quaglione & Dario D’Ingiullo & Linda Meleo, 2023. "Fixed and mobile broadband penetration and CO2 emissions: evidence from OECD countries," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 40(3), pages 795-816, October.
    43. Ajit K. Ghose, 2016. "Globalization, Growth and Employment in India," Indian Journal of Human Development, , vol. 10(2), pages 127-156, August.
    44. Stéphane Mbiankeu Nguea & Armand Gilbert Noula & Issidor Noumba, 2024. "Financial Globalization and Democracy: Implications for Economic Growth in African Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 3355-3379, March.
    45. Benard Ohene Kwatia & Godfred Amewu & Mohammed Armah, 2024. "Religiosity and financial development in Africa: evidence from panel quantile regression," Cogent Business & Management, Taylor & Francis Journals, vol. 11(1), pages 2315313-231, December.
    46. Ibrahim F. Akoum, 2008. "Globalization, growth, and poverty: the missing link," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 35(4), pages 226-238, March.
    47. Manmohan Agarwal & Pragya Atri & Srikanta Kundu, 2017. "Foreign Direct Investment and Poverty Reduction," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 18(2), pages 135-157, September.
    48. Md. Sabbir Hossain & Md. Golam Kibria & Md. Shafiqul Islam, 2018. "Does Globalization Affect the Economic Growth of Bangladesh? - An Econometric Analysis," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 8(12), pages 1384-1393.
    49. Jeffery I. Round, 2007. "Globalization, Growth, Inequality and Poverty in Africa: A Macroeconomic Perspective," WIDER Working Paper Series RP2007-55, World Institute for Development Economic Research (UNU-WIDER).
    50. Md. Monirul Islam & Kazi Sohag & Faheem ur Rehman, 2022. "Do Geopolitical Tensions and Economic Policy Uncertainties Reorient Mineral Imports in the USA? A Fat-Tailed Data Analysis Using Novel Quantile Approaches," Mathematics, MDPI, vol. 11(1), pages 1-25, December.
    51. Bahia, Kalvin & Castells, Pau & Cruz, Genaro & Masaki, Takaaki & Pedrós, Xavier & Pfutze, Tobias & Rodríguez-Castelán, Carlos & Winkler, Hernán, 2024. "The welfare effects of mobile broadband internet: Evidence from Nigeria," Journal of Development Economics, Elsevier, vol. 170(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bisiriyu Sodiq Olaide & Malik Manzoor Hassan, 2024. "Accounting for the interconnectedness of globalization, growth, and poverty towards achieving sustainable development," Quality & Quantity: International Journal of Methodology, Springer, vol. 58(6), pages 5655-5681, December.
    2. Mohammed Abubakar, 2024. "Globalisation and Output Growth Nexus in Sub-Saharan Africa: the Critical Role of Trade Liberalisation," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 2218-2240, March.
    3. Shreya Pal, 2024. "Do economic globalization and the level of education impede poverty levels? A non-linear ARDL approach," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 22(3), pages 621-667, September.
    4. Sethi, Pradeepta & Bhattacharjee, Sankalpa & Chakrabarti, Debkumar & Tiwari, Chhavi, 2021. "The impact of globalization and financial development on India’s income inequality," Journal of Policy Modeling, Elsevier, vol. 43(3), pages 639-656.
    5. Tolulope Osinubi & Titus Ojeyinka, 2022. "On the Nonlinear Effects of Globalization on Poverty: Insights from African Countries," Emerging Economy Studies, International Management Institute, vol. 8(2), pages 135-157, November.
    6. Hamza CESTEPE & Havanur Ergun Tatar & Serdar Erdogan, 2023. "The Impact of Globalization with its Different Aspects on Economic Growth: The Case of Turkey," Istanbul Journal of Economics-Istanbul Iktisat Dergisi, Istanbul University, Faculty of Economics, vol. 73(73-2), pages 717-743, December.
    7. Neagu Olimpia & Porumbăcean Teodora & Anghelina Andrei Marius, 2023. "Does Financial Development, Globalisation and Institutional Quality Drive the Income Convergence in the Central and Eastern European Union Countries?," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 33(1), pages 88-108, March.
    8. Sunny Kumar Singh & Prateek Sharma & Swati Sharma, 2024. "The nonlinear relationship between poverty and financial globalisation: A panel quantile regression approach," The World Economy, Wiley Blackwell, vol. 47(2), pages 664-708, February.
    9. Udaya R Wagle, 2010. "Does Low Inequality Cause Low Poverty? Evidence from High‐Income and Developing Countries," Poverty & Public Policy, John Wiley & Sons, vol. 2(3), pages 29-52, August.
    10. Alastaire Sèna ALINSATO, 2015. "Globalization, Poverty And Role Of Infrastructures," Journal of Economics and Political Economy, KSP Journals, vol. 2(1s), pages 197-212, May.
    11. Polsitty R. Kumar & Giuseppe T. Cirella, 2020. "Globalization – Reflective Outlook," Journal of Applied Management and Investments, Department of Business Administration and Corporate Security, International Humanitarian University, vol. 9(1), pages 42-50, March.
    12. Terver Theophilus Kumeka & Isiaka Akande Raifu & Oluwatosin Adeniyi, 2024. "Globalisation and Inclusive Growth in Africa: The Role of Institutional Quality," Foreign Trade Review, , vol. 59(1), pages 62-97, February.
    13. Alastaire S na ALINSATO, 2015. "Globalization, Poverty And Role Of Infrastructures," Journal of Economics and Political Economy, EconSciences Journals, vol. 2(1s), pages 197-212, May.
    14. Jinjin Zhang & Zixuan Li & Arshad Ali & Jinshu Wang, 2023. "Does globalization matter in the relationship between renewable energy consumption and economic growth, evidence from Asian emerging economies," PLOS ONE, Public Library of Science, vol. 18(8), pages 1-25, August.
    15. Qurrota Ayu NINDIEN & Arivina Ratih Yulihar TAHER & Asih MURWIATI & I Wayan SUPARTA & Neli AIDA, 2024. "Direct And Indirect Effect Of Globalization On Economic Growth In Indonesia," Scientific Bulletin - Economic Sciences, University of Pitesti, vol. 23(1), pages 33-44.
    16. Ayesha Naz, 2023. "Linkages between different types of globalization and socio-economic variables: panel data analysis for 129 countries," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 12(1), pages 1-23, December.
    17. Jalil, Abdul, 2012. "Modeling income inequality and openness in the framework of Kuznets curve: New evidence from China," Economic Modelling, Elsevier, vol. 29(2), pages 309-315.
    18. Khadijah Iddrisu & Joshua Yindenaba Abor & Kannyiri T. Banyen, 2024. "Financial development, globalisation and foreign direct investment nexus: an empirical study from Africa," SN Business & Economics, Springer, vol. 4(6), pages 1-31, June.
    19. Rasmane Ouedraogo & Hamidous Sawadogo & Issa Dianda, 2024. "Globalisation, economic growth and quality of infrastructure: New insights," The World Economy, Wiley Blackwell, vol. 47(4), pages 1682-1716, April.
    20. Sato, Sumie & Fukushige, Mototsugu, 2009. "Globalization and economic inequality in the short and long run: The case of South Korea 1975-1995," Journal of Asian Economics, Elsevier, vol. 20(1), pages 62-68, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:sustdv:v:34:y:2026:i:2:p:2536-2557. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1099-1719 .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.