Economic globalization convergence in high and low globalized developing economies: Implications for the post Covid-19 era

ABSTRACT

This paper explores the degree of economic globalization convergence in the high (European and Central Asia) and low (South Asia) globalized developing economies from 1984 to 2019. The sigma convergence and unit root test results indicate the presence of economic globalization convergence, which means countries are capable enough to catch up and follow the same transitional path in both regions. We utilize the two-step Langrage Multiplier and the three-step Residual Augmented Least Squares unit root tests as robust checking convergence results. The results indicate the presence of economic globalization convergence across all countries and developing regions. The findings from the Phillips-Sul panel club convergence technique further support evidence of overall economic globalization convergence in both developing regions The findings also enable growing regions to take the unequal distribution of globalization policies. Developing regions should take adequate measures to curb the Covid-19 pandemic outbreak to sustain the higher speed of economic globalization in the long run. They should adopt club and sector-specific policies to achieve a high speed of convergence and efficient utilization of economic globalization.