Regionalism, Globalization, and Economic Development of the World *

Abstract

This study evaluates the effects of regionalism on economic development in the world basing on the panel data of 217 countries. In general, regionalism pur- sued by countries via their respective regional organizations was found to have no significant independent effect on the economic development. Regardless of regionalism, the international economic variables such as globalization and terms of trade, as well as domestic variables such as population growth, urbani- zation and ethnic composition were found to have significant impact on eco- nomic development. In affecting economic development, the individual sovereign member states of regional organizations are independent of the collective institu- tional design of the regional organization they are affiliated with. The purpose of the present article is to analyze the effectiveness of regionalism by regional organizations in the world in affecting economic development. Not only regional intergov- ernmental organizations (RIGOs) like the European Union (EU), African Union (AU) and Association of Southeast Asian Nations (ASEAN), but also the regional free trade agree- ments (RFTAs) like North American Free Trade Agreement (NAFTA) are the driving forces of regionalism. The task of empirically assessing the effects of regionalism on eco- nomic development has been a critical challenge not only in developing but also in devel- oped countries. There are many other international as well as domestic variables that could also affect economic development. The effect study of regionalism should also cover 'all' regions in the world and this study is based on major regionalisms, aiming at covering all regions/subregions in the world: Europe, Africa, Southeast Asia, South Asia, Pacific Rim, Central Asia, North and South America, and Middle East. Different Views on Regionalism Regionalism is based on the following three ingredients: identifiable geographical region, geographical proximity and an organization with a common sense of identity and purpose (economic, political, security/military, etc.) among the member states. There are many views of the whys and wherefores of the joining the regional organizations. One of them is the effi- ciency of collective activities (Abbott and Snidal 1998; Karns and Mingst 2010: 6). The eco- nomic integration via regional organizations generates economies of scale. The regional- ism by RIGOs is also viewed from the perspectives of global and/or regional governance

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