The name is absent

5. Conclusions

In this paper we have used a systems GMM method of estimation to determine the
effects of globalization on the long run growth rate of 21 poor African countries. We found
that Dreher’s comprehensive measure of globalization, GLO, has in fact significant but
small permanent effects on the growth rate of output. However, without globalization, the
underlying long run growth rate in these countries is negative at about -2.5%. To achieve a
positive long run growth rate of 1.5%, GLO needs to be increased to 75.5. However, none of
these 21 countries have attained this level of globalization and therefore the scope for
increasing the growth rate through globalization is vast.

Some limitations of our paper need to be noted. Firstly, we our panel data is
unbalanced due to limitations in the availability of data. Second, our estimates of capital
stock with the perpetual inventory method may not be very accurate. Needless to say there is
scope for more robust estimates with alternative assumptions for the depreciation rates and
initial capital stock. Nevertheless, we hope that our methodology and use of SGMM method
would interest other investigators.

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