Globalization and Absolute Poverty – A Panel Data Study
Using panel data from more than 100 countries around the world from 1988 through 2007, this paper examines the relationship between economic and social globalization and absolute income poverty ex post. We use the globalization index developed by Dreher (2006) and the World Bank poverty estimates. Using a fixed-effect panel based on five-year averages and using a “long run” first difference regression, we find a robust negative correlation between globalization and poverty. We further examine mechanisms and robustness by separately analyzing the effects of components of economic (trade flows and trade policies) and social globalization (information flows, personal contact and cultural proximity) respectively, controlling for growth, education, inflation, urbanization, and government consumption. Results suggest that information flows and more liberal trade restrictions are robustly negatively correlated with absolute poverty. While growth decreases poverty in the long run, only a small part of the poverty-reducing effect of globalization is mediated via growth.
|Date of creation:||07 Feb 2011|
|Date of revision:|
|Publication status:||Published as Bergh, Andreas and Therese Nilsson, 'Globalization and Absolute Poverty – A Panel Data Study' in World Development, 2014, pages 42-61.|
|Contact details of provider:|| Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden|
Phone: +46 8 665 4500
Fax: +46 8 665 4599
Web page: http://www.ifn.se/
More information through EDIRC
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.:
- Rodríguez, Francisco & Rodrik, Dani, 1999.
"Trade Policy and Economic Growth: A Sceptic's Guide to the Cross-National Evidence,"
CEPR Discussion Papers
2143, C.E.P.R. Discussion Papers.
- Francisco Rodriguez & Dani Rodrik, 2001. "Trade Policy and Economic Growth: A Skeptic's Guide to the Cross-National Evidence," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 261-338 National Bureau of Economic Research, Inc.
- Francisco Rodriguez & Dani Rodrik, 1999. "Trade Policy and Economic Growth: a Skeptic's Guide to the Cross-National Evidence," Working Papers 9912, Economic Research Forum, revised Apr 1999.
- Sindzingre, Alice, 2005. "Explaining Threshold Effects of Globalization on Poverty: An Institutional Perspective," Working Paper Series RP2005/53, World Institute for Development Economic Research (UNU-WIDER).
- Verme Paolo, 2007.
"A Structural Analysis of Growth and Poverty in the Short-Term,"
Department of Economics and Statistics Cognetti de Martiis. Working Papers
200705, University of Turin.
- Paolo Verme, 2010. "A structural analysis of growth and poverty in the short-term," Journal of Developing Areas, Tennessee State University, College of Business, vol. 43(2), pages 19-39, January-M.
- Jenny Aker and Isaac M. Mbiti, 2010.
"Mobile Phones and Economic Development in Africa,"
211, Center for Global Development.
- Axel Dreher & Noel Gaston, 2006.
"Has globalization increased inequality?,"
KOF Working papers
06-140, KOF Swiss Economic Institute, ETH Zurich.
- Sinn, Hans-Werner, 1997.
"The selection principle and market failure in systems competition,"
Journal of Public Economics,
Elsevier, vol. 66(2), pages 247-274, November.
- Sinn, Hans-Werner, 1997. "The selection principle and market failure in systems competition," Munich Reprints in Economics 19854, University of Munich, Department of Economics.
- Dreher, Axel, 2006.
"The influence of globalization on taxes and social policy: An empirical analysis for OECD countries,"
European Journal of Political Economy,
Elsevier, vol. 22(1), pages 179-201, March.
- Axel Dreher, 2003. "The Influence of Globalization on Taxes and Social Policy – an Empirical Analysis for OECD Countries," Public Economics 0310002, EconWPA, revised 27 Feb 2004.
- Axel Dreher, 2003. "The Influence of globalization on taxes and social policy - an empirical enalysis for OECD countries," Discussion Papers 0301, Exeter University, Department of Economics.
- Salih Katircioglu, 2009. "Tourism, trade and growth: the case of Cyprus," Applied Economics, Taylor & Francis Journals, vol. 41(21), pages 2741-2750.
- 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.
- Pierre-Richard Agénor, 2004.
"Does globalization hurt the poor?,"
International Economics and Economic Policy,
Springer, vol. 1(1), pages 21-51, 03.
- Mattias Lundberg & Lyn Squire, 2003. "The simultaneous evolution of growth and inequality," Economic Journal, Royal Economic Society, vol. 113(487), pages 326-344, 04.
- Arribas, Iván & Pérez, Francisco & Tortosa-Ausina, Emili, 2009. "Measuring Globalization of International Trade: Theory and Evidence," World Development, Elsevier, vol. 37(1), pages 127-145, January.
- Axel Dreher, 2002. "Does Globalization Affect Growth?," Development and Comp Systems 0210004, EconWPA, revised 04 Feb 2003.
- Bergh, Andreas & Nilsson, Therese, 2010. "Do liberalization and globalization increase income inequality?," European Journal of Political Economy, Elsevier, vol. 26(4), pages 488-505, December.
- Paul Mosley & Abrar Suleiman, 2005.
"Aid, agriculture and poverty in developing countries,"
2005010, The University of Sheffield, Department of Economics, revised Jun 2005.
- Paul Mosley & Abrar Suleiman, 2007. "Aid, Agriculture and Poverty in Developing Countries," Review of Development Economics, Wiley Blackwell, vol. 11(1), pages 139-158, 02.
- Kenji Kondoh, 1997. "Permanent Migrants And Cross-Border Workers -The Effects On The Host Country-," Departmental Working Papers 1997-01, McGill University, Department of Economics.
- Elbers, Chris & Lanjouw, Peter, 2001. "Intersectoral Transfer, Growth, and Inequality in Rural Ecuador," World Development, Elsevier, vol. 29(3), pages 481-496, March.
- Axel Dreher, 2005.
"Does Globalization Affect Growth? Evidence from a new Index of Globalization,"
TWI Research Paper Series
6, Thurgauer Wirtschaftsinstitut, Universitï¿½t Konstanz.
- 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.
- Stark, Oded, 2004.
"Rethinking the Brain Drain,"
Elsevier, vol. 32(1), pages 15-22, January.
- Forestier, Emmanuel & Grace, Jeremy & Kenny, Charles, 2002. "Can information and communication technologies be pro-poor?," Telecommunications Policy, Elsevier, vol. 26(11), pages 623-646, December.
When requesting a correction, please mention this item's handle: RePEc:hhs:iuiwop:0862. 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: (Elisabeth Gustafsson)
If references are entirely missing, you can add them using this form.