@workingpaper{Asongu2012by,
title = {Globalization and Africa: implications for human development},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/022},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Globalisation-and-Africa.-Implications-for-Human-Development.pdf},
year = {2012},
date = {2012-02-01},
abstract = {Purpose – The purpose of this paper is to assess the effects of trade and financial globalization
on human development in 52 African countries using updated data (1996-2010) and a new
indicator of human development (adjusted for inequality).
Design/methodology/approach – The estimation technique used is a Two-Stage-Least Squares
Instrumental Variable methodology. Instruments include: income-levels, legal-origins and
religious-dominations. The first-step consists of justifying the choice of the estimation technique
with a Hausman-test for endogeneity. In the second-step, we verify that the instrumental
variables are exogenous to the endogenous components of explaining variables (globalization
dynamic channels) conditional on other covariates (control variables). In the third-step, the
strength and validity of the instruments are assessed with the Cragg-Donald and Sargan
overidentifying restrictions tests respectively. Robustness checks are ensured by: (1) use of
alternative globalization indicators; (2) endogeneity based estimation; (3) adoption of two
interchangeable sets of instruments; (4) estimation with a technique that controls for timeinvariant
unobservable shocks that affect openness and human development simultaneously.
Findings – Findings broadly indicate that while trade globalization improves human
development (consistent with the neoliberal theory), financial globalization has the opposite
effect (in line with the hegemony thesis). The ‘life expectancy’ component of the HDI weighs
most in the positive impact of trade globalization on human emancipation.
Originality/value – These findings are based on very recent data. Usage of the inequality
adjusted human development index first published in 2010, corrects past works of the bulk of
criticisms inherent in the first index.},
keywords = {Globalization; Human development; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}