Classification Analysis of World Economic Regions

Abstract

A functional classification of the world economic structure can provide useful synthesis of information of regional economies (Howe and Stabler 1989). Such a classification framework for countries can also provide information on economic status that can be evaluated over a number of time periods permitting the description of the dynamic behavior of national economies in a global context. The core-periphery social framework developed by Wallerstein (1979) and a similar economic description by Krugman (1995) and Fujita, Krugman, and Venables (1999) are adopted in this paper as the basis of classification owing to the utility of this framework for explaining economic and developmental disparities in the world economy.The case has been argued that the core-periphery framework is a perspective in need of description (Arrighi and

The Role of Foreign Direct Investment as a Structural Development Indicator of the Hierarchical World Economy

“…One factor that has proven effective empirically is investment risk (Johansen, 2006). Risk would be consistent with the politicaleconomic characteristics inherent in the hierarchy (Dezzani, 2001;Taylor and Flint, 2000). Core states are generally more politically and economically stable, with increased freedom of action in the intemational arena (Chase-Dunn, 1998;Taylor and Flint, 2000).…”

“…This type of analysis is primarily discrete and categorical, but is also more robust to statistical vagaries associated with international econometric studies than continuous regression models. 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 Groups of countries, such as OPEC, with often dichotomous stadstical measures become stadstically distinguishable and can be sufficiently accounted for (see Dezzani 2001).…”

“…As such, FDI may be expected to vary with a particular host state's position in the world system. Hence, region as classified in Dezzani (2001) becomes a determinant of FDI flows, much as a binary response variable in a regression model.…”

“…As such, core states and peripheral states exhibit separate and different production functions. In addition to the high-income core roughly spanning North America, Western Europe, and Japan, and the low-income periphery which includes the majority of the world's countries a third structural state exists as the semiperiphery which is composed of wealthy, noncore countries sufficiently able to act independently (Arrighi and Drangel, 1986;Babones, 2005;Chase-Dunn, 1998;Dezzani, 2001;Dezzani and Babones, 2008). Dezzani (2001;2002) has demonstrated the changes in state composition of the hierarchy from 1960 to 1990.…”

“…In addition to the high-income core roughly spanning North America, Western Europe, and Japan, and the low-income periphery which includes the majority of the world's countries a third structural state exists as the semiperiphery which is composed of wealthy, noncore countries sufficiently able to act independently (Arrighi and Drangel, 1986;Babones, 2005;Chase-Dunn, 1998;Dezzani, 2001;Dezzani and Babones, 2008). Dezzani (2001;2002) has demonstrated the changes in state composition of the hierarchy from 1960 to 1990. In general, the hierarchy exhibits stochastic stationarity and has demonstrated remarkable stability both in the 1960^90 period as well as in the 1980^2005 period (Dezzani and Babones, 2008).…”