Does Globalization Cause a Higher Concentration of International Trade and Investment Flows?
It has sometimes been argued that "globalization"
benefits only a small number of countries, and that this leads to greater marginalization
of excluded countries. This paper argues that globalization is not necessarily biased
towards greater concentration in international trade and investment flows.
Authors:
- Patrick Low
World Trade Organization - Marcelo Olarreaga
World Trade Organization and CEPR - Javier Suarez
University of Geneva
Manuscript date: August 1998
Abstract Back to top
It has sometimes been argued that "globalization" benefits only a small number of countries, and that this leads to greater marginalization of excluded countries. This paper argues that globalization is not necessarily biased towards greater concentration in international trade and investment flows. Marginalization is more likely to be explained by domestic policies in relatively closed countries. The paper shows that among relatively open economies, the concentration of international trade and investment flows has declined over the last two decades, whereas the opposite is true among relatively closed economies. Thus, marginalization is not intrinsic to globalization.
Keywords Back to top
Globalization, international trade and investment flows concentration.
JEL codes: [F11]; [F13]; [F21]
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