Co-integration Between Globalisation and Economic Growth

Abstract

This paper analyses the co-integration relationship between globalisation and economic growth of 26 more or less developed countries across almost all Continents for the time period 1970-2013. Globalisation is proxied by the overall globalisation index and the sub-indices representing economic globalisation, social globalisation and political globalisation, all provided by the Swiss Economic Institute. Economic growth is measured through the natural logarithm of the real Gross Domestic Product, sourced from the World Development Indicators which are provided by the World Bank. Co-integration is tested with quantile co-integration regressions. The results obtained clearly confirm the existence of non-linear co-integration relationships between the considered globalisation indices and the real economic growth.