The Investigation of Dependence Between the Internet Measurement and Globalization

The Investigation of Dependence Between the Internet Measurement and Globalization

Bruce Qiang Sun (SUNY Buffalo State, Buffalo, USA), Tina Ting Swan (SUNY Buffalo State, Buffalo, USA), Yan Lu (The University of New Mexico, Albuquerque, USA) and Lorena Mathien (SUNY Buffalo State, Buffalo, USA)
Copyright: © 2019 |Pages: 13
DOI: 10.4018/JGIM.2019100109

Abstract

Under the new measurement for the internet supplied from the Cooperative Association for Internet Data Analysis (CAIDA), the authors relax the orthogonal and normality condition with the methodology based on empirical codependence structures and marginal distributions. The nonparametric dependence between the diffusion of the internet and different globalization indices is examined using a panel of 10 countries, as long as error terms do not follow multivariate Gaussian distributions. The model selections are ranked and the authors find the best dependence model. The empirical dependence of the Internet diffusion on the globalization is further demonstrated from the dynamic copula analysis.
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1. Introduction

In recent years, there have been a large number of investigations on the relationship between technological advances and globalization. One of the most interesting topics is that, as the driving force, how do the emergence and rapid development of the Internet technology and its applications impact on globalization, or do they impact on each other? Although there are still debates, some facts and arguments have been generally accepted. The growth of the Internet has accelerated the dissemination of global information all over the world, which enables more effective and convenient communications among international decision-makers. Companies improve their productivity and competitiveness with more efficient and smooth processing of transactions. Furthermore, the E-commerce on the Internet has been more competitive, giving consumers more diverse choices. Therefore, all of these have greatly boosted the globalization including the economic and political interactions, technology and capital flows and international social welfare.

The Internet can be defined as an innovative communication that enables the dissemination, exchange, storage and analysis of data and all kinds of global information. While the multi–national flows of information, trade and capital are key elements to globalization, the Internet plays an innovative role on the global economy and politics. To measure the Internet development across countries, many researchers use data from the Internet Software Consortium (ISC) to count how many web hosts are attributed to each country by counting top-level host domain names. As they point out, however, this may not be a very good measure, since there is no necessary correlation between a host’s domain name and where the site is actually located. Generally, there are two concerns need to be addressed: First, there are still confusions and debates on the exact measurements on the development of the Internet on the globalization and vice versa. Second, there are also debates on whether the statistical algorithms, tools and analytical models can give exact description and understanding of their dependence relation.

As to the measurement of globalization, there are many indicators published periodically in the past decade. The popular ones that researchers frequently applied are listed below. The World Development Indicators (WDI) from the World Bank are published quarterly, including more than 900 indicators organized in different sections, such as, financial sector, trade, world view, environment, economy, markets, and global links. The Organization of Economic Cooperation and Development (OECD) puts together special groups of experts to evaluate the processes of globalization in almost all dimensions. They publish the OECD Handbook on Economic Globalization Indicators in response to increasing demands for better measures to the trends of globalization, with a conceptual and methodological framework for gathering quantitative information and constructing indicators. The International Monetary Fund (IMF) also supplies various indices to illustrate the international flows of goods, capital, and people. Different from the above measurements, the KOF Swiss Economic Institute has devised a composite index of globalization, the KOF Globalization Index. The index measures the social, economic, and political dimensions of globalization. It observes the globalization of a set of countries over a long-term period. The economic globalization index measures the extent of cross-border trade, investment and revenue flows in relation to GDP; the index also measures the social dimension of globalization in the cross-border personal flows as well as the size of the resident foreign population, and cross-border information flows; and finally, it provides the cultural and political proximity to the global mainstream.

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