The Variables in the Index
The names and definitions of the variables in the index, plus their average (i.e. mean) values, are given below:
Table 1
Sub-Index |
Variable |
Definition |
Mean* |
|
Economic Globalisation |
Trade |
Exports plus imports of goods and services as a proportion of GDP |
83.29% |
|
Foreign Direct Investment (FDI) |
Inflows plus outflows of foreign direct investment as a proportion of GDP |
2.35% |
|
|
Portfolio Investment |
Inflows plus outflows of portfolio investments as a proportion of GDP |
3.22% |
|
|
Income |
Employee compensation paid to non-resident workers and investment income from foreign assets owned by domestic residents plus employee compensation paid to resident workers working abroad and investment income from domestic assets owned by foreign residents, as a proportion of GDP. |
9.12% |
|
|
|
|
|
|
|
Social Globalisation |
People |
||
|
Foreign Stock |
Stock of foreign population as proportion of total population. |
6.65% |
|
|
Foreign Flow |
Inflows of foreign population as proportion of total population. |
0.5% |
|
|
Worker Remittances |
Worker remittances (receipts) as a proportion of GDP. |
3.11% |
|
|
Tourists |
Number of tourists (arrivals plus departures) as proportion of total population. |
57.15% |
|
|
Ideas |
|||
|
Phone calls |
International outgoing telephone traffic (minutes) per capita |
0.059 |
|
|
Internet users |
Internet users as a percentage of population |
3.97% |
|
|
Films |
Number of films imported and exported. |
310.92 |
|
|
Books and newspapers |
Sum of value of books and newspapers imported and exported per capita (US dollars) |
10.08 |
|
|
|
Number of international letters delivered and sent per capita |
15.76 |
|
|
|
|
|
|
|
Political Globalisation |
Embassies |
Number of foreign embassies in country |
34.16 |
|
UN Missions |
Number of UN peacekeeping operations in which country participates |
1.16 |
|
|
Organisations |
Number of memberships of International organisations |
40.70 |
|
So, the economic globalisation index is constructed from four variables, the social globalisation index is constructed from nine variables (four included in the people globalisation sub-index, and five in the ideas globalisation sub-index), and the political globalisation index is constructed from three variables.
It is also clear from Table 1 that the mean or average values of the variables differ considerably, even across variables that are used to construct a given sub-index. To deal with this, we normalise the variables.