How to assess economic progress in the era of discontinuity?
| Published date | 01 May 2023 |
| Author | Marceli Hązła,Ewa Mińska‐Struzik |
| Date | 01 May 2023 |
| DOI | http://doi.org/10.1111/1758-5899.13180 |
Global Policy. 2023;14 :331–3 48.
|
331
wileyonlinelibrary.com/journal/gpol
1 | THE CONCEPT OF
GL OBA LI SAT IO N
Globalisation is one of the terms that dominated
media and academic debate at the turn of the millen-
nium. Many authors have already attempted to de-
fine (and also to assess the effects of) globalisation
(Conley, 2002; Fine, 2004; Rupert, 2005)— and al-
though some complexities still need to be clarified, a
good point of reference seems to be the general defini-
tion proposed by a consortium of international organi-
sations (UN et al.,2002, p. 170), according to which
globalisation is ‘a term used to describe the increasing
internationalisation of markets for goods and services,
means of production, financial systems, competition,
corporations, technologies and industries’. The above
definition is part of the ‘narrow’ understanding of glo-
balisation, emphasising mainly the economic and tech-
nological sphere, while referring to the political and
social issues in passing, to the extent necessary to de-
scribe the presented regularities. Sociological, cultural,
political and development studies address many other
problems leading to a broader understandin g of the no-
tion (Nederveen,2012). Nevertheles s, the vast majority
of definitions note the speedy technological progress
as the main driving force for globalisation processes,
reducing the signification of distance and finally lead-
ing to the compression of time and space (Huebener
et al.,2016).
What is an extremely important feature of global-
isation, however, is its discontinuity. Indeed, certain
events may cause significant changes in the shape
and scope of globalisation processes. A clear exam-
ple of this was the occurrence of the financial crisis
in 2007– 2009, which drastically affected the values of
the global flows of goods, servi ces, capital and labour,
prompting some authors to rethink the current defin-
ing features of globalisation (Altman, 2009; Önis &
RESEARCH ARTICLE
How to assess economic progress in the era of
discontinuity?
MarceliHązła | EwaMińska- Struzik
Received: 3 Janu ary 2022
|
R evised: 30 December 20 22
|
A ccepted: 3 January 202 3
DO I: 10 .1111/17 58- 589 9.13 180
© 2023 Durham Unive rsity and John Wiley & So ns Ltd.
Poznan Universit y of Economics and
Business, Poznan, Poland
Correspondence
Ewa Mińska- Struzik, Poznan University
of Economics an d Business, Poznan,
Poland.
Email: ewa.minska-struzik@ue.poznan.pl
Funding information
Poznan Universit y of Economics and
Business
Abstract
The aim of this article is to contribute to the discussion on designing alternative
economic development indices by measuring economic progress in the face of
the discontinuity of globalisation. To this end, we use different evaluation criteria
for the ‘old’ (1960– 1990) and the ‘new’ (1990– 2019) globalisation. First, the his-
torical context that has shaped the contemporary globalisation processes is out-
lined, which makes it possible to identif y the 1990s and the subsequent change
in the structure of the world industrial produ ction and the world GDP as the most
important tipping point. Based on the observation that none of the existing indi-
ces sufficiently cover all the issues, a new pilot measure of economic progress
is proposed, which takes into account two time periods: the old (1960– 1990)
and the new (1990– 2019) globalisation. The analysis of the data sample of 18
countries (G6, I6 and selected LDCs) using this measure makes it possible to
assign their economies to four categories, depending on the results they have
achieved; the ‘winners’, the ‘losers’, the ‘late- bloomers’ and the ‘inmates of in-
dustry’. Furthermore, possible directions for the future research on the subject
are indicated. The data set supporting this study has been made publicly avail-
able to help in its continuation.
[Correction ad ded on 10 March 2023,
after first online publication: The
title has been c orrected from “How
to assess the ec onomic progress in
the era of discon tinuity?” to “How to
assess econo mic progress in the era of
discontinui ty?” in this current ve rsion.]
332
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HĄZŁA and MIŃSKA- S TRUZIK
Güven,2 011). However, the global financial crisis was
not the only event that had a significant impact on the
shaping of globalisation processes. Kowalski (20 11)
identifies the emergence of the post- war institutional
order, the dissolution of the Bretton Woods system
and the aforementioned financial crisis as the most
important of them.
In light of the above observations, what becomes
an interesting issue is the development of econo-
mies in the face of the discontinuity of globalisation
processes. Alas, the mainstream of economic discus-
sion is still dominated by the optics focused on eco-
nomic growth expressed by GDP; hence, the main
conclusion of the global financial crisis was the oc-
currence of a ‘recession’ and an ‘economic recovery’
afterwards. The issue worth addressing, however, is
the impact of globalisation on the evolution of mac-
roeconomic aggregates that help quantif y long- term
economic development. To stress an alternative ap-
proach to understanding and measuring the possible
transformations of economies participating (though to
a different extent) in the globalisation process, which
is also changing its features, the term progress is used
instead of conventionally defined economic develop-
ment. Traditionally, when discussing economic devel-
opment, the authors focused on the quantitative, and
to some extent, qualitative improvement in the usage
of available resources, following the Kusnetzian, struc-
turalist line of thought (Pearson,2000). However, since
the proposal of HDI (UNDP,1990), the term started to
encompass a wider variety of social issues, as can be
seen for instance, in the Balanced Development Index
proposed by Koźmiński et al. (2020). Nevertheless,
despite the undeniably profound impact that global-
isation has on the life of societies, in the light of the
considerations in this paper, it initially concerns mainly
the economic and technological spheres, which are
fuelled by technological progress. In this view, social
changes are mostly a specific derivative thereof and,
as such, are not considered a part of the concept of
economic progress. Therefore, the paper attempts
to contribute to the discussion on designing alterna-
tive economic development indices by assessing the
progress of selected economies in the face of non-
linear globalisation.
The article is organised as follows. The first section
outlines the historical context that has shaped con-
temporary globalisation processes, which provides a
starting point for further considerations. The second
section discusses the methodology used to design
the Progress Index, aimed at assessing the evolution
of selected economies in the face of the discontinuity
of globalisation. The third section discusses the results
obtained by the aforementioned methodology. The
conclusions highlight the key messages arising from
the considerations in this paper, together with an indi-
cation of possible directions for future research.
2 | GLOBALISATION AS A
NON- LINEAR PROCESS
Globalisation is not a continuous and predictable pro-
cess. Rather, the course of globalisation processes re-
sembles a sequence of successive upsurges (events
that deepen or loosen these processes), triggered by a
variety of causes. Each of these upsurges may, in turn,
lead to various consequences for different groups of
countries. This could already be obser ved during the
so- called rst wave of globalisation in the second half
of the 19th century, which contributed to an unprece-
dented expansion of world trade and ushered in an era
of modern economic growth (Baldwin,2020, pp. 28–
29). The estimates of the average annual growth rate in
the value of world exports between 1850 and 1913 vary
between 3.26% (Maddison, 1962 p. 128) and 3.48%
(Lewis & Yeats,1981, pp. 11– 12). It means that it grew
Policy Implications
• Economic progress is a narrower concept
than development, but it encompasses
more than just economic growth dynamics.
Designing any progress index, one needs to
consider a set of complementary indicators.
• Globalisation is not a continuous process.
Measuring the progress shaped by different
waves of globalisation calls for a dynamic ap-
proach and appropriate change of indicators
used. The 1990s brought the first significant
shift, as reflected in the proposed new index
structure. A second shift is currently taking
place due to the COVID-19 pandemic and
the corresponding responses of the national
economies. In the future, it will be possible
to adjust the indicators making up the pro-
gress index to the post-pandemic era, allow-
ing for tailor-made macroeconomic policy
recommendations.
• Alongside winners and losers of globalisa-
tion, one can also distinguish late-bloomers
and inmates-of-industry that call for special
attention and a specific bundle of po licy tools.
• The progress index could prove helpful for
experts at international organisations such as
the World Bank or IMF in formulating policy
recommendations for groups of economies
that are similar in terms of indicators con-
tained in the index, rather than using income
level classification. A "late-bloomer" might
require different treatment than a "loser", de-
spite both of them belonging to the "low in-
come" group.
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