Conceived and designed the experiments: PS. Performed the experiments: PS. Analyzed the data: PS. This study was carried out to investigate the effect of economic globalization on economic growth in OIC countries. Furthermore, the study examined the effect of complementary policies on the growth effect of globalization. It also investigated whether the growth effect of globalization depends on the income level of countries.
Utilizing the generalized method of moments GMM estimator within the framework of a dynamic panel data approach, we provide evidence which suggests that economic globalization has statistically significant impact on economic growth in OIC countries. The results indicate that this positive effect is increased in the countries with better-educated workers and well-developed financial systems. High and middle-income countries benefit from globalization whereas low-income countries do not gain from it.
In fact, the countries should receive the appropriate income level to be benefited from globalization. Economic globalization not only directly promotes growth but also indirectly does so via complementary reforms. Globalization, as a complicated process, is not a new phenomenon and our world has experienced its effects on different aspects of lives such as economical, social, environmental and political from many years ago  — . Economic globalization includes flows of goods and services across borders, international capital flows, reduction in tariffs and trade barriers, immigration, and the spread of technology, and knowledge beyond borders.
It is source of much debate and conflict like any source of great power. The broad effects of globalization on different aspects of life grab a great deal of attention over the past three decades. As countries, especially developing countries are speeding up their openness in recent years the concern about globalization and its different effects on economic growth, poverty, inequality, environment and cultural dominance are increased.
As a significant subset of the developing world, Organization of Islamic Cooperation OIC countries are also faced by opportunities and costs of globalization. Figure 1 shows the upward trend of economic globalization among different income group of OIC countries.
Although OICs are rich in natural resources, these resources were not being used efficiently. It seems that finding new ways to use the OICs economic capacity more efficiently are important and necessary for them to improve their economic situation in the world.Globalization has offered considerable controversial impact.
It has been viewed as a process that is major factor that is a key to the development of the world economy and also it is inevitable and irreversible.
Some regard it with hostility, fear that increases inequality between nations, threatens employment and living standards and social progress.
These brief facts is an overview of some aspects of globalization and aims to identity ways in which countries can tap the gains of this process while remaining realistic about its possible abilities and its dangers.The Future of Global Capitalism: Branko Milanovic in Conversation
In fact, globalization offers essential opportunities for global developments but it is not progressing in an evenly pace. Some countries have adapted to globalization and it is participating into the global economy faster than other countries are.
This is because countries with globalization some countries have been able to integrate and are growing faster and reducing poverty. However, the effectiveness of globalization in developing countries is widely active because globalization helps give opportunities in such countries in order to establish stability especially in the economy, trade, politics, society, labor, technology and to reduce poverty level.
Developing country like the Philippinesis one of the countries in Asia where the country has been effected by globalization. The country is taking part in the process of globalization ever since the country signed agreements with WTO World Trade Organization in Generally, the Philippines is one of the developing countries that is rapidly dealing with globalization ever since the influence of the US during the World War II.
The country had high levels of education and English literacy due to the influence of Uncle Sam, decent savings rates, and an export-oriented agricultural sector that generated more than sufficient foreign exchange.
The industrial sector was growing rapidly and the country had one of the highest per capita incomes in Southeast Asia. There was much to look forward to on the economic and business front. The Philippines is a country of ups and downs of conspicuous consumption of devastating poverty, hunger and suffering. The economy is basically agricultural, with rice, corn, and kamote sweet potatoes the staple food crops. Key cash crops include coconuts, fruits and vegetables, sugar, tobacco, and abaca the famous "Manila hemp" used for rope making.
In aggregate, about two-thirds of Filipinos continue to depend on the agricultural sector. The Philippines is rich in natural resources, as reflected in the fact that foreign exchange earnings have derived largely from export of primary commodities. The export of fruits and vegetables, especially pineapple products and bananas, plays a key economic role every year. Among the minerals that the Philippines produces are copper, gold, nickel, chromium, iron, and manganese. Mining will continue to be important in the future, particularly copper, nickel, chromite, and iron.
However, the costs are high according to the international standards and many gold mines and other operations are not economically at its best. The Philippines global economy remains in transition and the nation has been living through a period of increasing volatility. Philippines have four regions that globalization has targeted and these four are: liberalization, mobility of capital, technology, and management of organization through private and public sectors.
Each of these factors has been in its own way force throughout the world. But more interesting is the realization that governments today no longer possess the reserves to materially affect the global capital markets. Capital now moves according to the dictates of markets, not of governments.
With its great confidence on joining the WTO, the Philippines are still lagging behind its Southeast Asian neighbors in terms of economic performance. But when the nation joined the WTO inthe Philippines had entered the global economic game with its domestic political economy unprepared and undeveloped. As a result, the Philippine state has failed to create the kind of organized socioeconomic environment that would have prepared the country for global competition.
There are many things that globalization that brought quick changes into the Philippine society. With its vast development it has brought about technologies mostly computers and software and also telecom companies are being introduced into the market.
Thanks to globalization, such technologies were influenced by Philippines neighboring Asian countries like Malaysia and Chinaand even Japan. Thanks to globalization, it has opened its economy to foreign trade and investment. Furthermore, globalization has allowed Filipino workers to travel the world, but most head for the Middle East, East Asia, the US and Canada and Europe due to better economies and better money.Globalization aims to benefit individual economies around the world by making markets more efficient, increasing competition, limiting military conflicts, and spreading wealth more equally.
The Milken Institute's "Globalization of the World Economy" report of highlighted many of the benefits associated with globalization while outlining some of the associated risks that governments and investors should consider, and the principles of this report remain relevant.
The economic crisis led many politicians to question the merits of globalization. The U. The election of Donald Trump in the U. These trends have been driven by anti-immigration sentiments in Europe, although the election results veer more pro- than anti-globalization. Economists suggest that nowadays, cross-border investments are not being made so much to build capital infrastructure as they are to seek countries with the lowest taxes.
Some form of globalization may be inevitable over the long-run, but the historic bumps spurred by economic crises and other consequences suggest that change is the only reliable constant.
According to U. Customs and Border Protection, escalated U. Milken Institute. Accessed March 6, Organisation for Economic Co-operation and Development. Homeland Security Digital Library. National Sovereignty. World Bank. Milken Institute Review.
McKinsey Global Institute. Select USA. American Enterprise Institution. International Investing Getting Started. By Full Bio Follow Linkedin. Justin Kuepper is a financial journalist and private investor with over 15 years of experience in the domestic and international markets. Read The Balance's editorial policies. Reviewed by. Full Bio.
She specializes in divorce, death, career changes, and caring for aging relatives. Article Reviewed on April 04, In this entry we analyze available data and research on international trade patterns, including the determinants and consequences of globalization over the last couple of decades.
Here is an overview of the main points we cover below. The integration of national economies into a global economic system has been one of the most important developments of the last century. This process of integration, often called Globalization, has materialized in a remarkable growth in trade between countries. The chart here shows the value of world exports over the period These estimates are in constant prices i. This chart shows an extraordinary growth in international trade over the last couple of centuries: Exports today are more than 40 times larger than in This will help you see that, over the long run, growth has roughly followed an exponential path.
The chart above shows how much more trade we have today relative to a century ago. But what about trade relative to total economic output? Over the last couple of centuries the world economy has experienced sustained positive economic growthso looking at changes in trade relative to GDP offers another interesting perspective.
The next chart plots the value of trade in goods relative to GDP i. This shows that over the last hundred years of economic growth, there has been more than proportional growth in global trade. This creates an intricate network of economic interactions that cover the whole world. The interactive data visualization, created by the London-based data visualisation studio Kiln and the UCL Energy Institutegives us an insight into the complex nature of trade.
It plots the position of cargo ships across the oceans. Over the last couple of centuries the world economy has experienced sustained positive economic growthand over the same period, this process of economic growth has been accompanied by even faster growth in global trade. In a similar way, if we look at country-level data from the last half century we find that there is also a correlation between economic growth and trade: countries with higher rates of GDP growth also tend to have higher rates of growth in trade as a share of output.
This basic correlation is shown in the chart here, where we plot average annual change in real GDP per capita, against growth in trade average annual change in value of exports as a share of GDP. Among the potential growth-enhancing factors that may come from greater global economic integration are: Competition firms that fail to adopt new technologies and cut costs are more likely to fail and to be replaced by more dynamic firms ; Economies of scale firms that can export to the world face larger demand, and under the right conditions, they can operate at larger scales where the price per unit of product is lower ; Learning and innovation firms that trade gain more experience and exposure to develop and adopt technologies and industry standards from foreign competitors.
Are these mechanisms supported by the data? When it comes to academic studies estimating the impact of trade on GDP growth, the most cited paper is Frankel and Romer In this study, Frankel and Romer used geography as a proxy for trade, in order to estimate the impact of trade on growth.
This is a classic example of the so-called instrumental variable approach. Following this logic, Frankel and Romer find evidence of a strong impact of trade on economic growth. Other papers have applied the same approach to richer cross-country data, and they have found similar results. This body of evidence suggests trade is indeed one of the factors driving national average incomes GDP per capita and macroeconomic productivity GDP per worker over the long run.
If trade is causally linked to economic growth, we would expect that trade liberalization episodes also lead to firms becoming more productive in the medium, and even short run. There is evidence suggesting this is often the case. Pavcnik examined the effects of liberalized trade on plant productivity in the case of Chile, during the late s and early s.
She found a positive impact on firm productivity in the import-competing sector. And she also found evidence of aggregate productivity improvements from the reshuffling of resources and output from less to more efficient producers.
Bloom, Draca and Van Reenen examined the impact of rising Chinese import competition on European firms over the periodand obtained similar results. They found that innovation increased more in those firms most affected by Chinese imports.
And they found evidence of efficiency gains through two related channels: innovation increased and new existing technologies were adopted within firms; and aggregate productivity also increased because employment was reallocated towards more technologically advanced firms. On the whole, the available evidence suggests trade liberalization does improve economic efficiency.
This evidence comes from different political and economic contexts, and includes both micro and macro measures of efficiency. This result is important, because it shows that there are gains from trade.The sudden increase in the exchange of knowledge, trade and capital around the world, driven by technological innovation, from the internet to shipping containersthrust the term into the limelight.
Some see globalisation as a good thing. The United Nations has even predicted that the forces of globalisation may have the power to eradicate poverty in the 21st century. Others disagree. Globalisation has been attacked by critics of free market economics, like the economists Joseph Stiglitz and Ha-Joon Chang, for perpetuating inequality in the world rather than reducing it.
Some agree that they may have a point. The International Monetary Fund admitted in that inequality levels may have been increased by the introduction of new technology and the investment of foreign capital in developing countries. Others, in developed nations, distrust globalisation as well.
They fear that it often allows employers to move jobs away to cheaper places. However, economic historians reckon the question of whether the benefits of globalisation outweigh the downsides is more complicated than this. For them, the answer depends on when you say the process of globalisation started.
But why does it matter whether globalisation started 20,or even 2, years ago? Early economists would certainly have been familiar with the general concept that markets and people around the world were becoming more integrated over time. Although Adam Smith himself never used the word, globalisation is a key theme in the Wealth of Nations. His description of economic development has as its underlying principle the integration of markets over time.
As the division of labour enables output to expand, the search for specialisation expands trade, and gradually, brings communities from disparate parts of the world together. The trend is nearly as old as civilisation.
Eventually armourers to craft bows and arrows, carpenters to build houses, and seamstress to make clothing all appeared as specialist artisans, trading their wares for food produced by the hunters and shepherds. As villages, towns, countries and continents started trading goods that they were efficient at making for ones they were not, markets became more integrated, as specialisation and trade increased.
Smith had a particular example in mind when he talked about market integration between continents: Europe and America. The discovery of Native Americans by European traders enabled a new division of labour between the two continents. As European currencies were generally based on the value of silver, any change in its value would have had big effects on the European price level.
Smith himself argued this was one of the greatest economic changes that resulted from the discovery of the Americas:.Anecdotal and descriptive evidence has led to the claim that globalization plays a major role in inducing overweight and obesity in developing countries, but robust quantitative evidence is scarce. We undertook extensive econometric analyses of several datasets, using a series of new proxies for different dimensions of globalization potentially affecting overweight in up towomen aged 15—49 living in 56 countries between and After controlling for relevant individual and country level factors, globalization as a whole is substantially and significantly associated with an increase in the individual propensity to be overweight among women.
Surprisingly, political and social globalization dominate the influence of the economic dimension. Hence, more consideration needs to be given to the forms of governance required to shape a more health-oriented globalization process. Globalization has often been blamed for the rapid rise in obesity in much of the developing world Hawkes, ; Popkin, ; Zimmet, The existing evidence for this claim does, however, rest primarily on case studies and simple ecological comparisons of national conditions.
Arguably, the scarcity of quantitative data amenable to statistical analysis relates to the difficulty in quantifying the complex, multi-faceted nature of globalization. Economists were among the first to try to quantify the different components of globalization in their attempt to assess its impact on economic growth Dollar and Kraay, ; Dreher, Indeed, the measures of globalization commonly employed have been exclusively economic, commonly proxied by e.
Yet, globalization is not solely an economic process, and even if it were, there is more to economic globalization than the mere flow of goods and capital. More recent efforts at measuring globalization were built on the conceptualisation by Keohane and Nye of three different relevant dimensions of globalization: 1 economic: long distance flows of goods, capital and services as well as information and perceptions that accompany market exchanges, 2 political: the diffusion of government policies internationally, and 3 social: the spread of ideas, information, images, and people Dreher, For all dimensions, this index was created using comprehensive data collected annually, from to In this paper we make use of this new measure and its various components, to arrive at a more detailed and nuanced assessment of the impact of different dimensions of globalization on overweight in low- and middle-income countries.
All three of these components of globalization might have contributed to obesity in low- and middle-income countries, and because they capture different dimensions and — as will be shown further below — are at best imperfectly correlated with each other, it is important to examine the influence of each sub-dimension separately.
While there exists a considerable literature which considers the role of technological change in affecting energy expenditure and consumption e. In the case of globalization, the nutritional transition may also be facilitated by the importation of cheaper, higher energy density foods from the industrialized world, rather than from the countries' internal production.
The most readily recognized manifestation of economic globalization is the opening of markets to foreign trade and investment in the second half of the last century, which entailed a substantial increase in agribusiness-related foreign direct investment FDI Hawkes, Political factors relating to the formation of regional trade blocks, or participation in various international treaties, may also have played a role, by acting as a precursor to greater economic integration via the opening of food markets to free trade and consequent nutritional change associated with overweight.
On the one hand, greater political integration on a regional level is likely to lead to deeper regional cooperation e. While the precise impact of such manifestations of political integration on overweight in developing countries is hard to predict, it may at least be conceivable that political globalization acts independently of or as a facilitator of purely economic forces.
Differential effects of political vs. Social and cultural globalization, involving cross-border movement of cultures and openness of media, may also have increased a population's perception of the supposed benefits of foreign lifestyles e. In addition to examining the importance of these different components of globalization, a further unique feature of our analysis consists of the integration of the various indicators of globalization into a world-wide dataset containing individual-level information up toindividuals.
This allows us to a utilise information on the objectively measured overweight status of each individual and b to control for relevant individual-level covariates e.
To better isolate the effect of the various manifestations of globalization, it is important to control for a range of country-level factors that may simultaneously affect individual overweight risk and the country-level indicators of globalization, including the total GDP as a proxy of the size of the market, the Human Development Index, as well as the Index of Economic Freedom from the Heritage Foundation, which measures the quality of economic and legal institutions.
Through this analysis we aim to find out whether overall globalization indeed increases the individual likelihood of overweight, and whether the different dimensions of globalization — economic, political and social — play a greater or lesser part in raising the risk of overweight. Globalization is our independent variable of primary interest. We seek to capture both the influence of globalization as a whole as well as its relevant sub-components: economic, social and political globalization dimensions.
Total globalization is measured using the KOF total globalization indicator Dreher,which is an aggregation of three sub-components, described below.Login or Subscribe Newsletter.
Emily Hiestand Email: hiestand mit. With that mission in mind, MIT's School of Humanities, Arts, and Social Sciences has launched The Human Factor — an ongoing series of stories and interviews that highlight research on the human dimensions of global challenges.
Contributors to this series also share ideas for cultivating the multidisciplinary collaborations needed to solve the major civilizational issues of our time. Malick Ghachem is an attorney and a professor of history at MIT who explores questions of slavery and abolition, criminal law, and constitutional history.
He teaches courses on the Age of Revolution, slavery and abolition, American criminal justice, and other topics. MIT SHASS Communications recently asked him to share his thoughts on how history can help people craft more effective public policies for today's world. Q: Your new research focuses on economic globalization and political protest in Haiti, a country with a complex social, political, and economic history.
What lessons can we learn from Haiti's history that can inform more effective public policies? A: I think the most important lesson for public policy may be that we cannot ignore the distant past — and in the case of Haiti, by "distant past" I mean only so far back as the 18th century.
With apologies to colleagues who study the yet more distant centuries of ancient and medieval history! Public policy has a short-term memory, however, and this is especially true of economic policy, which tends to look back only so far as the early 20th century to understand, for example, how a financial crisis comes about and what it entails.
Haiti showcases the decisive present-day impact and legacies of a history that goes back more than years, to the rise of the slave plantation system. My current work tells the story of a planter rebellion in the s against the French Indies Company, an event that ended the era of slave-trading monopolies in Saint-Domingue as Haiti was known under French rule and left large-scale sugar planters in effective control of the colony.
Some of the key political and social cleavages that have characterized Haitian life ever since date back to this period. We can see this on any number of levels. The environment is another example. Part of the resistance to accepting the reality of climate change whether in Haiti or elsewhere is a reluctance to acknowledge that history in this deep sense matters.
Yet it is clear that deforestation in Haiti begins no later than the 17th century, when French settlers began using trees for purposes of lumber and fuel. That historical perspective, in turn, suggests one of the difficulties that besets even the most well-intentioned relief work in Haiti today. These tragedies rightly call upon the generous aid of first-responders, but after the sense of emergency passes, the eyes of the world often turn elsewhere. An understanding of how these tragedies draw on the full weight of Haitian history encourages and even demands a longer-term commitment to the problems at hand.
And it suggests that effective responses to what seem like essentially medical, environmental, or legal problems must cut across conventional categories of policy analysis and understandings of responsibility.
Take the case of United Nations liability for the cholera outbreak in Haiti after the earthquake. The natural impulse of human rights lawyers in that context was to file suit against the U. But the U. Framing responsibility in narrowly legal or chronological terms runs head-on into this reality and limits rather than expands our sense of the potential remedies. Q: What connections do you see between economic conditions including globalization and monetary policy and the ability of a people or a culture to make innovations in science, technology, and public policy?
A: Waking up hungry each morning does not leave one with great deal of energy for scientific or any other kind of work during the day. The resources that make possible scientific and technological innovation are the same ones that sustain the relatively high standard of daily living many of us enjoy in the United States. This fact places a premium on access to U.
Globalization is a form of Colonialism
This is a crisis of sovereignty that takes the form of a monetary crisis. One of the two key triggers of the revolt against the Indies Company was a suspicion that the Company intended to eliminate the use of local Spanish silver coins, on which most colonists depended for their livelihood. The lack of a reliable and stable currency remained a problem throughout the colonial period and continues to severely constrict the economic horizons of many Haitians today.
Q: As MIT President Reif has said, solving the great challenges of our time will require multidisciplinary problem-solving — bringing together expertise and ideas from the sciences, technology, the social sciences, arts, and humanities.
Can you share why you believe it is critical for any effort to address the well-being of human populations, and the planet itself, to incorporate tools and perspectives from the field of history? Also, what challenges do you see to multi-disciplinary collaborations — and how can we overcome them?
Globalization and Economic Growth: Empirical Evidence on the Role of Complementarities
We also need to appreciate that, even within the world of the social sciences and the humanities, there are deep and abiding differences about how best to understand and implement public policy. These works tend to suggest that there is a unifying model, theory, or historical pattern that accounts for the disparities: political corruption, institutional competence, the rule of law, protection of private property, etc. These phenomena are all important, but the particular forms they take can really only be understood on a case-by-case basis.