What are the effects of Globalization on Economic Growth and Inequality?: An empirical global study

The recent event of increased interconnectedness between countries in the last two decades has heightened the interests of scholars around the world, to discuss its impacts towards two important indicators, economic growth and inequality. Although the general agreed consensus suggests that globalization activities are beneficial to those that engage, it is often weighted against its negative impacts upon inequality between and in-within countries. Despite this, this research forms its purpose through identifying that the extensive literature focuses primarily on income measures as the only proxy for inequality. Furthermore, there is a lack of taking into account social factors that contribute to the significance of inequality. This research therefore branches an innovative approach to form and empirically test accurate proxies as possible, given a set range of available macro data by the World Bank, for social inequalities as measurement variables in conjunction with Globalization and Economic Growth. The aim is to bridge and connect the stories between the three components. In addition, the proxies for social inequalities define for which those (the population) at the lowest echelons of the status quo struggle to access adequate facilities for, technology, general health, employment (with emphasis to female employment) and health of new-borns. The research design uses panel vector-autoregression, Error-Correction, Granger Causality and Impulse Response modelling to capture findings for 35 low-middle- and low-income countries during the period 2000-2016. The findings show that Globalization and Economic Growth positively affects social inequality in developing countries, and in particular to, a country’s access to electricity (with emphasis to technologies for cooking, the internet and mobile cellular usage) and general health. In contrast, to the remaining indices, there were no effects found for Globalization and Economic Growths’ contribution to access to employment (with emphasis to female employment) and health of new-borns. In addition, Globalization was found to positively affect Economic Growth. The findings provide dedicated support for Globalization and provide policymakers with recommendations for improvement in the areas to which no effects were found (in 2 of 4 social inequality indexes). The main limitation to the research surrounds data availability. With technology forever evolving and improving, in the future, more accurate statistics can better provide the econometric models with predicting power.

Grantor dc:publisher

Oxford Brookes University

Year dc:date

2023

Author dc:creator

• Nguyen, Ba Huy

Contributors dc:contributor

• Asteriou, Dimitrios

Statement dc:rights

• All rights reserved

Language dc:language

en

DOI dc:identifier

https://doi.org/10.24384/bpjb-sq78

OAI identifier oai:identifier

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