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Measuring Globalisation
A New Globalisation Index (KOF)
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Introduction
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Why measure globalisation?uanti!y a "ery #ontended $henomenon
and allow ob%e#ti"e
&uantitati"e analysis
Identi!y'&uanti!y sour#es and im$a#ts
Analysis and dee$er understanding o! the $ro#ess
Analysis o"er time and a#ross regions
In"estigate lins to other indi#ators $o"erty* ine&uality*
growth+
If you can not measure it, you can not improve it.
Lord Kelvin
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,he dimensions o! globalisation
-#onomi#
.rban
/o#ial'0ultural 1inguisti#
2oliti#al
3emogra$hi#
-n"ironmental
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-#onomi#Globalisation
,he globalising$ro#ess as asystem o!inter#onne#tedelements
ands#ales
Model de"elo$edby 2eter 3i#ens
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4ow would you &uantitati"ely measure le"els o! globalisation
globally?
Globalization:,he growinginterde$enden#e o! #ountries
worldwide through the in#reasing"olume and "ariety o!
#ross5border transa#tions in goods andser"i#es and o!
international#a$ital !lows* and through themore ra$id and
wides$read
di!!usion o! te#hnology6
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KOF Index o! Globalisation
Globalization:,he growinginterde$enden#e o! #ountries
worldwidethrough the in#reasing "olume and"ariety o! #ross5border
transa#tions ingoods and ser"i#es and o! international
#a$ital !lows* and through the morera$id and wides$read
di!!usion o!te#hnology6
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Introdu#ed in 7887
/wiss -#onomi# Institute'/wiss Federal Institute
o!,e#hnology
3e!ines globalisation to be 9a $ro#ess o! #reating networ
o!#onne#tions among a#tors at multi5#ontinental distan#es*meditated
through a "ariety o! !lows in#luding $eo$le*in!ormation and ideas*
#a$ital and goods:
,hree dimensions o! the KOF Index o! Globalisation -#onomi#
globalisation
2oliti#al globalisation
/o#ial globalisation
Index "alue #loser to ;88 the more globalised the #ountry
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-#onomi# Globalisation
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2oliti#al Globalisation
Number o! embassies and high#ommissions
Number o! international organisationsto whi#h a #ountry is a
member
Number o! $ea#e missions a #ountry
$arti#i$ated in Number o! treaties signed between
two or more states
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/o#ial Globalisation 2ersonal #onta#ts
3ire#t intera#tion among $eo$le li"ing in di!!erent
#ountries
International tele#om tra!!i#
3egree o! tourism
In!ormation !lows
Measure the $otential !low o! ideas and images
Number o! internet users
/hare o! households with a tele"ision set
0ultural $roximity
Im$orted and ex$orted boos
Number o! M#3onald:s restaurants ad IK-A stores
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1imitations and #riti#isms
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2oints o! Note with KOF Index
,he KOF Index o! 2009shows thatglobali
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Advantages of KOF
,he index allows #om$aring degreeand #hanges in globali
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Advantages of KOF Index
em$loying the weighted indi"idual dataseries instead o! using
the aggregatedlower5le"el globali
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isadvantages of KOF
the results were sometimes dri"en byextreme outlying
obser"ations andmissing "alues6
#ultural globali
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Advantages of KOF
,he index allows #om$aring degreeand #hanges in globali
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Advantages of KOF Index
em$loying the weighted indi"idualdata series (instead o! using
theaggregated globali
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isadvantages of KOF
the results were sometimes dri"en by extremeoutlying
obser"ations and missing "alues6
#ultural globali
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Eesults
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,o$ ;8 (;)
ear 788@EANK 0O.N,E; Ireland
7 /wit
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,o$ ;8 (7)
"O#$%&' &an(
FIN ,EA3-2O1
/O0
Ireland ) 7 = 7
*+itzerland 2 ;D @
$et,erlands - ; = 78
Belgium . @ 7 ;8
/alta C 7= D
"!1rus ;D @C ;
Iceland 3 D DB ;#nitedKingdom 4 = D ;=
Austria 9 ;7 ;C C
*+eden )0 B ; ;B
Finan#ial $ositions#orrelate highlywith the !inal results All in
to$ ;@
3e"elo$ed -. ,o$ 78 in all
subindi#es
Hnewer and non5-.ha"e lower ranings
in trade'$olsubindex Ireland* Malta* 0y$rus
and I#eland not in to$78
4igh $ositions due to
ear 788@
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0ontributions o! indi"idualdimensions di!!er a#ross
#ountries
Ireland Germany 0hina /lo"a Ee$ubli#8L
;8L
78L
8L
D8L@8L
C8L
B8L
8L
=8L
88L
so#ial
trade $oliti#s
!inan#e
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%,an( !ou for !ourattention5
