@workingpaper{Amavilah2014,
title = {Globalization, Peace & Stability, Governance, and Knowledge Economy},
author = {Simplice Asongu & Antonio Andrés A R Voxi Amavilah},
editor = {African 2014 Governance and Development Institute WP/14/012},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Globalisation-peace-and-stability-governance-and-knowledge-economy.pdf},
year = {2014},
date = {2014-08-01},
abstract = {A previous analysis of the impact of formal institutions on the knowledge economy of 22 MiddleEastern
and Sub-Sahara African countries during the 1996-2010 time period concluded that formal
institutions were necessary, but inadequate, determinants of the knowledge economy. To extend
that study, this paper claims that globalization induces peace and stability, which affects
governance and through governance the knowledge economy. The claim addresses one weakness
of previous research that did not consider the effects on the knowledge economy of globalization.
We model the proposition as a three-stage process in four hypotheses, and estimate each
hypothesis using robust estimators that are capable of dealing with the usual statistical problems
without sacrificing economic relevance and significance. The results indicate that globalization
has varying effects on peace and stability, and peace and stability affect governance differently
depending on what kind of globalization induces it. For instance, the effects on governance
induced by globalization defined as trade are stronger than those resulting from globalization
taken to be foreign direct investment. Hence, we conclude that foreign direct investment is not a
powerful mechanism for stimulating and sustaining the knowledge economy in our sample of
countries. However, since globalization-induced peace and stability have both positive and
negative effects on governance simultaneously, we also conclude that while the prospect for
knowledge economy in African countries is dim, it is still realistic and attainable as long as these
countries continue to engage in the kind of globalization that does indeed induce peace and
stability. We further conclude that there is a need for a sharper focus on economic and institutional
governance than on general governance as one possible extension of this paper.},
keywords = {Globalisation; Peace and Stability; Governance; Knowledge Economy},
pubstate = {published},
tppubtype = {workingpaper}
}