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"Core" and "Periphery" in the World Economy: An Empirical Assessment of the Dependence of Third World Growth on the Developed Countries

Author

Listed:
  • Julius Horvath

    (Southern Illinois University at Carbondale)

  • Richard Grabowski

    (Southern Illinois University at Carbondale)

Abstract

This paper classifies the relationship between the developed and developing countries into three categories: strong dependency, weak dependency and independence of the developing country on the developed world (G-7). A country is characterized as strongly (weakly) dependent when it has a negative (positive) response to permanent shocks originating from the center and the weight of these shocks is relatively important in explaining total variation in the output of the developing country. Independence is characterized with low weight of shocks from the center. The results of a dynamic vector autoregressive model suggest that from the sample of 86 developed countries only five of them could be considered strongly dependent, while the others are roughly divided equally into weakly dependent and independent.

Suggested Citation

  • Julius Horvath & Richard Grabowski, 1996. ""Core" and "Periphery" in the World Economy: An Empirical Assessment of the Dependence of Third World Growth on the Developed Countries," Development and Comp Systems 9609002, University Library of Munich, Germany, revised 30 Sep 1996.
    • Handle: RePEc:wpa:wuwpdc:9609002
    Note: Type of Document - WordPerfect; prepared on IBM PC; to print on HP III; pages: 30; figures: none. Single binary WordPerfect 5.1 for DOS file uploaded with Netscape 2.02. See SIUC's entire list of working papers at http://www.siu.edu/departments/cola/econ/discpapr.html.
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    References listed on IDEAS

    as
    1. Wil Hout, 1993. "Capitalism And The Third World," Books, Edward Elgar Publishing, number 234.
    2. Bayoumi, Tamim & Eichengreen, Barry, 1992. "Shocking Aspects of Monetary Unification," Department of Economics, Working Paper Series qt791143kp, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    3. Tamim Bayoumi & Barry Eichengreen, 1992. "Shocking Aspects of European Monetary Unification," NBER Working Papers 3949, National Bureau of Economic Research, Inc.
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    More about this item

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • E11 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Marxian; Sraffian; Kaleckian

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