Convergent and Divergent Development of National Economies in the Context of Financialization

• Main Authors: Hrazhevska Nadiia I., Shemakhina Iryna V.
• Format: Article
• Language: English
• Published: Research Centre of Industrial Problems of Development of NAS of Ukraine 2019-05-01
• Series: Bìznes Inform
• Subjects: globalization; financialization of the global economy; convergent and divergent development of national economies; ?-convergence; ?-divergence
• Online Access: http://www.business-inform.net/export_pdf/business-inform-2019-5_0-pages-14_19.pdf
• ISSN: 2222-4459; 2311-116X

The aim of the study is to identify the impact of financialization on convergent and divergent development of national economies. It is argued that convergence and divergence are two interrelated determinants of the development of the world economy. Based on the analysis of statistical data for the period 2000–2018, it is found that the high growth rates of the relative majority of less developed countries, compared to developed ones, confirm the hypothesis of ?-convergence of national economies and transformation of the world economy into a single structural and functional system. On the other hand, the implementation of the neoliberal model of globalization in the absence of an effective institutional and organizational streamlining of world economic processes deepens the gap between different groups of countries, increasing the divergence of national economies, as evidenced by the growing differentiation of countries in terms of per capita income, which does not support the hypothesis about ?-convergence. Under these circumstances, further institutional and organizational harmonization of the global economy, creation of effective national and international institutions and organizations, mitigating the contradictions of the financialization of the world economy and directing globalization processes towards the coordination of the interests of various groups of countries, are gaining importance.