ENVIRONMENTAL MARKET FAILURE AND GLOBALIZATION IN DEVELOPING COUNTRIES

This paper presents an international view of sustainable development. The paper aims to provide an analysis on the link between openness to trade and economic growth and market failure like externalities. It focuses on the globalization process as the main factor for environmental problems. Albanian economy is exposed to a global economy and after twenty long years is still behind its Balkan neighbor. Albania is making the difficult transition to a more modern open-market economy. International trade has been a major driver of global growth and prosperity over the last century. The empirical literature has taken one of two advantage points. The first one is to analyze the correlation between openness and growth in data sets that cover a large section of developing and developed countries, in the tradition of cross country growth empirics. The second one is to concentrate on country or region-level analytical case studies of economic growth. We believe that this framework will contribute to understand why certain developing countries have made progress, while others have not. Progress has been very impressive for a number of developing countries in Southeast Europe, but progress has been less rapid for other countries like Albania. As a nation we have to think about what future research opportunities exist for us. The scale and scope of future research is an issue that affects our entire society and the next generation. The government has a general role in supporting this discussion, by setting up a dialogue with the community.