The Impact of Economic Globalization on Labor's Productivity in Jordan

This study aims to investigate the impact of economic globalization on labor's productivity in Jordan, during the period (1980-2010). Where Augmented Dickey- Fuller test (ADF) was utilized to examine the stationarity of the variables of this study. The results have shown that the variables are nonstationary at their levels, but they become stationary at their first differences. Johansen cointegration test was also applied, and it is found there is no cointegration among the variables in the model.The Granger causality test found that there is a bidirectional causal relationship between economic globalization and real labor productivity. Two tools of analysis were employed: impulse response function and variance decomposition through applying a vector autoregression (VAR) model. The final results have shown that economic globalization explains most of the forecast error of and has a possitve impact on the Jordanian labor productivity.