Macroeconomics-for-Growth under Financial Globalization: Four Strategic Issues for Emerging Economies

AbstractWhile mitigation efforts in developed and emerging economies are necessary in order to meet ambitious climate targets, the international community strives to explore strategies to help the most vulnerable populations to cope with the short-term and long-term impacts of climate change. In the perspective of the 21st COP of the UNFCCC (Paris, December 2015), this Special Issue on ‘Climate change mitigation and adaptation in developing and transition countries’ addresses two complementary topical issues. On the one hand, migration – international and internal – and remittances are analyzed as adaptation strategies for vulnerable households and individuals. On the other hand, climate policies in emerging economies are examined in light of their distributional impacts for households and of the strategic issues they may raise. This special issue introduces five papers with a diversity of approaches, e.g., game theory, econometric modeling and computable general equilibrium (CGE) modeling.

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Impact of globalization on income inequality in Asian emerging economies

International Journal of Sociology and Social Policy ◽

10.1108/ijssp-08-2019-0167 ◽

2019 ◽

Vol 40 (1/2) ◽

pp. 44-57

Author(s):

Kashif Munir ◽

Mahnoor Bukhari

Keyword(s):

Income Inequality ◽

Emerging Economies ◽

Financial Integration ◽

Least Square ◽

Financial Globalization ◽

Trade Restrictions ◽

Policy Makers ◽

Content Type ◽

The Rich ◽

The Impact

Purpose The purpose of this paper is to examine the impact of three modes of globalization, i.e. trade globalization, financial globalization and technological globalization, separately on income inequality on the Asian emerging economies. Design/methodology/approach The study uses Hecksher–Ohlin and the Stolper–Samuelson theorem as a theoretical model for the relationship between globalization and income inequality. The study uses pooled least square (POLS) and instrumental variable least square (IVLS) estimation technique but prefers the IVLS over POLS due to the problems of omitted variable biased and endogeneity. Due to unavailability of data for all the Asian emerging economies, the study uses the following 11 countries, i.e. Bangladesh, China, India, Indonesia, Malaysia, Pakistan, Philippines, Sri Lanka, Singapore, South Korea and Thailand, from 1980 to 2014 for the trade and technological globalization model and from 1990 to 2014 for the financial globalization model. Findings Trade globalization significantly contributes to reduce income inequality in the Asian emerging economies. The impact of financial globalization on income inequality suggests that financial integration causes an increase in income inequality. Therefore, the benefits of financial globalization are not evenly distributed among the rich and the poor. The impact of technological globalization significantly contributes in the reduction of income inequality. Practical implications Government has to invest in research and development activities, establish efficient financial system, reduce trade restrictions and provide subsidies that help to increase the volume of trade. Originality/value This study contributes in the existing literature by analyzing the impact of trade globalization, financial globalization and technological globalization on income inequality in Asian emerging economies. The study provides useful guidelines to policy makers and governments to make effective policies in relation to globalization and income inequality that lead toward economic growth and reducing income inequality.

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Capital account liberalization and its effects on economic growth and financial instability: the exante orthodox models were wrong

Brazilian Journal of Political Economy ◽

10.1590/0101-31572020-3027 ◽

2020 ◽

Vol 40 (4) ◽

pp. 669-688

Author(s):

DIEGO GARCIA ANGELICO ◽

GIULIANO CONTENTO DE OLIVEIRA

Keyword(s):

Emerging Economies ◽

Financial Crises ◽

Empirical Studies ◽

Financial Instability ◽

Capital Account ◽

Financial Globalization ◽

Capital Account Liberalization ◽

Multilateral Institutions ◽

Theoretical Assumptions ◽

The Subject

ABSTRACT The financial crises in emerging economies during the 1990s and 2000s propelled academia and multilateral institutions to investigate whether the promised benefits of capital account liberalization were being delivered or not. In the course of empirical studies on the subject, many ex ante theoretical assumptions on financial globalization were demystified, and previously unknown risks and dysfunctions began to be evidenced. This article analyzes the main empirical studies on the effects of financial globalization published in the last two decades and shows that the main conventional assumptions that were built to theoretically base the capital account liberalization processes that occurred in the 1980s and 1990s were wrong.

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