Modelling Development in the Global South

Abstract

Assessing the relationship between aid, trade, investment, and development in the Global South, this paper argues that these relationships are mediated by three factors: the intentions of the foreign actor and type of economic input; the robustness of a country or bloc’s government-business-media (GBM) complex; and, finally, the spatiotemporal make-up of a country or bloc. In terms of stimulating human development, the findings suggest that how inputs are used is more operative than what is received, with a robust GBM providing optimal conditions for human development. Overall, aid, foreign direct investment and being landlocked have a negative relationship with development in the Global South, while trade has a small, but statistically significant positive relationship. Contrary to what most argue, resource richness positively impacts on development in the Global South. Countries displaying several of these factors should be particularly cautious as landlocked countries with dysfunctional GBMs, limited resources, and who receive large amounts of aid and investment, are likely to remain underdeveloped.