Empirical Analysis of Impacts of Globalization on the Dynamics of Inflation & HDI in Developed Economies

Abstract

This study aims to overcome theoretical, contextual, and geographical gaps in the current frameworks for HDI analysis and inflation in developed states. The sample population for this study includes three developed countries: the UK, the USA, and Canada. The research study used the sample period from 1990 to 2023. The data structure is an annual-based balanced panel data set, which maintains the preposition of having the sample for each country in the same form in all the years. The study found that inflation has a positive but statistically insignificant long-term relationship with globalization, while HDI has a positively significant long-term relationship with globalization. In the short-run, inflation shows a positively significant relationship with globalization, whereas HDI has a positive but statistically insignificant short-run relationship with globalization. The study has recommended that there is a need to build up the inflation indexes by including variables such as food and energy, which are frequently unpredictable.