Growth determinants in Latin America and East Asia: has globalization changed the engines of growth?

Abstract

"The answer that emerges to the question: Has globalization changed the engines of growth,? from a comparative analysis between Latin America and East Asia , in spite of the extraordinary opportunities brought upon by this process, is a qualified no: investment, followed by industrial growth and savings, the traditional engines of growth, still have the most robust influence, far stronger than the variables epitomizing globalization, exports and capital flows (including FDI). In East Asia exports and capital flows are not as important as investment, industrial growth and savings. In Latin America exports and capital flows seem to have a somewhat stronger influence. In the same direction, a dynamic analysis shows that the Increasing Returns Dynamics involving the virtuous cycle Investment productivity rowth exports competitiveness growth Investment continue to rule the growth process under globalization."