The Effect of Globalisation on the Development of Underdeveloped1 Economies
THE EFFECT OF GLOBALISATION ON THE DEVELOPMENT OF UNDERDEVELOPED1 ECONOMIES
By
MUSA JEGA IBRAHIM
The existing wide disparities between the developed and the underdeveloped economies makes globalisation a tool for stultifying the industrialisation process, and by extension, retarding the growth and development of underdeveloped economies. Trade liberalisation, the cardinal instrument of globalisation ensures that industrialised countries have access to world markets, which enhances further industrialisation of industrialised countries while incapacitating the industrialisation process of the underdeveloped economies. The paper is an attempt to examine issues surrounding the paradox of globalisation and provide a framework for underdeveloped countries to circumvent the overbearing effect of globalisation in their efforts towards industrialisation, economic growth and development. INTRODUCTION Globalisation constitutes a critical motivation for development in the contemporary world of today as a result of the challenges it poses to nation states. The equation of global influence is fundamentally determined by a vibrant economy that is characterised by inherent ability to sustain a steady state growth path and development. Theories of economic growth (both neoclassical and endogenous models) converge on the fact that technology is the driving force of economic growth. The crucial factor in global economic equation is therefore technological capabilities, which makes proper utilisation of resources feasible. In turn, the utilisation of resources is a requisite process for attaining technology and generating economic growth.
1
Classification such as “developed”, “developing” and “underdeveloped” have been used to describe
countries depending on their levels of attainment of the features of development. This paper will use underdeveloped countries (economies) due to its focus on the most poor countries of the world that are widely drifted from the status
By
MUSA JEGA IBRAHIM
The existing wide disparities between the developed and the underdeveloped economies makes globalisation a tool for stultifying the industrialisation process, and by extension, retarding the growth and development of underdeveloped economies. Trade liberalisation, the cardinal instrument of globalisation ensures that industrialised countries have access to world markets, which enhances further industrialisation of industrialised countries while incapacitating the industrialisation process of the underdeveloped economies. The paper is an attempt to examine issues surrounding the paradox of globalisation and provide a framework for underdeveloped countries to circumvent the overbearing effect of globalisation in their efforts towards industrialisation, economic growth and development. INTRODUCTION Globalisation constitutes a critical motivation for development in the contemporary world of today as a result of the challenges it poses to nation states. The equation of global influence is fundamentally determined by a vibrant economy that is characterised by inherent ability to sustain a steady state growth path and development. Theories of economic growth (both neoclassical and endogenous models) converge on the fact that technology is the driving force of economic growth. The crucial factor in global economic equation is therefore technological capabilities, which makes proper utilisation of resources feasible. In turn, the utilisation of resources is a requisite process for attaining technology and generating economic growth.
1
Classification such as “developed”, “developing” and “underdeveloped” have been used to describe
countries depending on their levels of attainment of the features of development. This paper will use underdeveloped countries (economies) due to its focus on the most poor countries of the world that are widely drifted from the status
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