Netherlands ranks high on Globalization Index

The Dutch economy ranks 8th place in the World Globalization Index.

A report “Winning in a polycentric world” released today by Ernst & Young in cooperation with the Economist Intelligence Unit (EIU) shows that, after a brief pause in 2009 and a modest rebound in 2010, the world’s 60 largest economies will continue to globalize steadily between now and 2014, driven by the continued global economic recovery, technological innovation and the rise of the emerging markets.

The report measures and tracks the performance of the world’s 60 largest economies according to 20 separate indicators that capture the key aspects of cross-border integration of business. The indicators fall into five broad categories: openness to trade; capital movements; exchange of technology and ideas; labor movements; and cultural integration.

The Netherlands scores particularly well on the first three criteria, the latter two are left behind compared to other top ten countries.

On top of the list are Hong Kong, Ireland and Singapore.

The index looks at the extent to which countries are active in the world. The measurements say nothing about the impact of a country in the world economy.

That explains that countries with a large domestic market such as China, India or the United States, ranks approximately in the middle of the list.

Winning in a polycentric world also highlights the tension between the flattening effect of globalization and significant variations across international markets. While the former encourages companies to roll out business and operating models globally, differences between markets will demand a more localized approach.

The report draws on two sources of original research: Ernst & Young’s Globalization Index, which measures the world’s 60 largest economies according to their degree of globalization relative to their GDP, and a survey of more than a thousand senior business executives worldwide, conducted in late 2010, canvassing their thoughts on globalization.

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