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The era of globalization has brought substantially less progress than was achieved in the preceding 20 years. This study by the Center for Economic and Policy Research concludes that the data provide no evidence that the policies associated with globalization have improved outcomes for developing countries, and its findings challenge economists and policymakers who cite globalization as an engine of growth while pressing for policies that strengthen the trend. The study also served as a backdrop to the release of the United Nations Development Program's Human Development Report on July 11, 2001. Using standard measures of economic growth, health outcomes, education, and literacy, the CEPR study compares the progress achieved during the period preceding globalization, 1960-80, with the period from 1980 to 2000, which was characterized by the reduction of tariff and nontariff barriers to trade, the removal of restrictions on international investment flows, and increasing intervention by the International Monetary Fund and World Bank on a wide range of economic and policy issues. While the evidence presented here does not prove that the policies associated with globalization were responsible for the deterioration in economic performance, it does present a very strong prima facie case that some structural and policy changes implemented during the last two decades are at least partly responsible for these declines.

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This article outlines a set of desirable properties of an adequate model for assessing distributional impacts of macroeconomic policy packages, and uses these as criteria to evaluate four model types commonly used for such assessments, namely, fixed ratio, econometric, CGE and microsimulation models. The desirable properties fall into five broad groups: being able to represent policy levels used in the policy packages, allowing for both price‐ and quantity‐clearing markets, integrating financial stocks, representing short‐term dynamics, and providing measures of confidence in a model's output. Of the model types reviewed, CGE models perform the best on most criteria, in spite of their substantial flaws of non‐verifiability and lack of short‐term analysis.

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