Globalization and economic growth: Evidence from two decades of transition in CEE

This paper examines the role of various aspects of globalization for economic growth in ten CEE economies. In contrary to previous papers, we restrict our analysis solely to the first two decades of transition. Using the globalization indexes published by the Swiss Economic Institute, we found stron...

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Bibliographic Details
Published in:Economic modelling 2014-01, Vol.36, p.99-107
Main Authors: Gurgul, Henryk, Lach, Łukasz
Format: Article
Language:English
Subjects:
CEE transition economies
Economic growth
Economic theory
Foreign direct investment
Foreign investment
Globalization
International trade
Manycountries
Political economy
Studies
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Summary:This paper examines the role of various aspects of globalization for economic growth in ten CEE economies. In contrary to previous papers, we restrict our analysis solely to the first two decades of transition. Using the globalization indexes published by the Swiss Economic Institute, we found strong and robust evidence of growth-stimulating effect of globalization processes, especially in social and economic dimensions. On the other hand, the role of political dimension of globalization was not found to be statistically significant in any research variant. The result, which seems to be particularly interesting, is that the development of the internet, television and trade in newspapers (the social dimension of globalization) had at least as strong positive impact on economic development in CEE economies in the first two decades of transition as the rise in international trade, growth of foreign investment, reduction of import barriers and development of a tax policy (the economic dimension). •Globalization was a significant growth factor of CEE economies in period 1990–2009.•Development of social sphere of globalization stimulated growth of CEE economies.•Information flows played a key role in growth of CEE economies in transition.•Economic globalization was an important growth factor of CEE economies.•Political globalization played minor role in growth of new EU members in transition.
ISSN:0264-9993
1873-6122
DOI:10.1016/j.econmod.2013.09.022