The Impact of Globalization and Economic Freedom on Economic Growth: The Case of Latin American and Caribbean Countries

• Autor(a) principal: Santiago, Renato Filipe Barros
• Data de Publicação: 2017
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10400.6/7830
• topic: Crescimento Económico; Globalização; Liberdade Económica; Países da América Latina e Caraíbas; Domínio/Área Científica::Ciências Sociais::Economia e Gestão

In this study, we examined the impacts of globalization and economic freedom on the economic growth of a group of 21 developing countries from Latin America and the Caribbean over a time span that ranges from 1996 to 2013. Since heteroscedasticity, contemporaneous correlation, first order autocorrelation and cross-sectional dependence were present in the panel, the dynamic Driscoll-Kraay was used. We have constructed two models, one with the globalization overall and another with the political, social, and economic dimensions of globalization. In a second stage, we also corrected the most worrying shocks that we noticed in these economies. In general, our results point that globalization has a positive impact on growth as also economic globalization, but not all of its dimensions have the same positive effects. Social globalization showed to have a negative impact on growth, and political globalization did not show any statistically significant effect. On the other hand, considering the results from our estimations we can also conclude that economic freedom has a negative impact on the economic growth of our sample. The effects of globalization and economic freedom seem only to be noticed in the long-run, only economic globalization, when we do not correct for shocks, and electric power consumption, in all estimations, shows to have short and long-run effects on growth. Finally, the negative and significant coefficient of the error correction mechanism in all estimations point to the presence of cointegration/long-memory relationships between the variables.