THE IMPACT OF GLOBALIZATION ON HUMAN DEVELOPMENT IN THE DEVELOPING COUNTRIES: THE CASE OF CENTRAL AND SOUTH AMERICA

Resumo

This research aims to empirically test the impact of globalization on human development by studying 17 Latin American countries in a range of time from 1995 to 2009, in order to confirm the hypothesis that the effect of globalization on human development of developing countries depends on specific aspects of globalization and human development, as well as the level of state fragility and delinquency. The motivation leading this research is the fact that globalization has not brought improvement in the developmental conditions of the population as a whole. The potential and originality of this study includes the contribution to providing evidence by testing empirically the relationship between globalization and human development in Central and South America in such a way that will allow us to differentiate what kind of globalization is positive or negative in distinct areas of human development. And this is with the purpose of helping policymakers to have a clearer idea of what can be done according to each country’s peculiarities to enhance the human development in a globalized era.

       The outcomes from empirical data analysis that employ Panel Corrected Standard Errors (PCSE) modeling reveal that globalization has a conditional correlation with human development in Central and South American countries. That is, globalization has both positive and negative effects depending on specific aspects and their indicators to measure each aspect of globalization (economic, social or political globalization), the specific area of human development examined and the level of state fragility and delinquency in each country. The overall globalization index is found to have a positive effect on human development index. However, when globalization is disaggregated, the economic globalization sub index is found to have a negative effect, while social and political globalization sub indexes have positive effects on the human development in Central and South American countries.