Download How the KOF index is measured

Indices of Globalisation
There are several indices available to meaure the
extent of globalisation. We will study the Kearney
index in more detail but before we do this, let’s take a
look at the KOF index.
In addition to the indices measuring the three dimensions, KOF calculates
an overall index of Globalisation and sub indices referring to actual
economic flows, data on personal contact and data on cultural proximity.
Economic
globalisation charaterised as
long distance
flows of goods,
capital and
services, as
well as
information
and
perceptions
that
accompany
market
changes
The KOF
index has
three
dimensions
Political
globalisation characterised
by diffusion of
government
polices
Social
Globalisatio
nexpressed
as the
spread of
ideas,
information,
images and
people
A shrinking world …
Which countries are most ‘globalised’?
A ‘globalisation index’ measures the interconnectivity of
countries based on different kinds of integration, divided
by a country’s GNP or its total population …
Measures of interconnectivity include:
A)Economic: Two dimensions: 1. Actual economic flows and
2. Restrictions on trade and capital
B)Political: Uses a number of embassies and high
commissions in a country, the number of international
organisations to which the country is a member and the
number of UN peace missions a country has participated in.
Social: Three categries used here:
1: Personal contacts - includes international telecom travel
(on going traffic in minutes per subscriber, the degree of
tourism (Incoming and outgoing), Government and workers
transfers received and paid (as a % of GDP), measures as to
what extent countries interact
2. Information flows - includes the number of internet
users, cable TV subsribers, number of radios (all per
1000), and international newspapers traded as a % of
GDP
3. Cultural proximity - Difficult to grasp but seen as
domination of US cultural products, e.g. number of
Macdonalds, and Ikea stores.