DOES ECONOMIC-GROWTH BENEFIT THE MASSES - GROWTH, DEPENDENCE, AND WELFARE IN THE THIRD-WORLD

Despite recent economic gains in much of the Third World, sociologists have paid little attention to the possible national benefits of econo mic growth. Instead, they have focused on the possible harm caused by the Third World's dependence on foreign investment and trade. Our anal ysis questions that focus. Based on data for 62 less-developed countri es spanning two decades, we find that the effects of dependence largel y vanish when (1) the effects of economic growth are carefully specifi ed, and (2) the ''semi-difference'' models currently in vogue in cross -national research are replaced by more appropriate difference or diff erence-of-logs (growth-rare) models. In light of the common claim that economic growth in the Third World benefits only the rich, we employ measures of national welfare that the rich cannot readily monopolize. The effects of economic growth on national welfare are large and robus t, whereas the effects of dependence are hard to find. These findings contradict earlier studies, which had concluded that the effects of de pendence dwarf the effects of economic growth.