Assessing the Effectiveness of the Fiscal Policy Tools in Facilitating Inclusive Economic Growth

This study examines the relationship between tourism and inclusive growth in Nigeria from 1995Q1 to 2022Q4. The objective is to determine the effect of tourism on inclusive growth in Nigeria. Auto Regressive Distributed Lags (ARDL) modelling is utilized to estimate the linkage of tourism and inclusive growth over the period. The results show a positive and significant relationship between international tourism receipt at lag period 1 and inclusive economic growth in Nigeria, a positive and significant relationship between international tourist arrivals at levels and inclusive growth in Nigeria, a negative and insignificant relationship between exchange rate at levels and inclusive economic growth in Nigeria and no long run cointegrating is established with tourism and inclusive economic growth in Nigeria. Also, jointly all the variables in the model significantly influence inclusive growth in Nigeria. The findings suggest that tourism is influencing inclusive economic growth in Nigeria only in the short run period. The study recommends increasing investment in tourism related infrastructures, strengthening social welfare programs to ensure that benefits of tourism receipts reach marginalized population, and strengthening exchange rate to ensure higher earnings from tourism, all these measures will ensure that the benefits of tourism will go beyond short-term benefits to long- term benefits to citizens in Nigeria.

Relevance. The study of inclusive economic growth remains highly relevant as the concept of growth continues to evolve. Measuring and analysing its determinants offers opportunities to foster inclusive growth at both regional and national levels. Research Objective. This study analyses inclusive economic growth in East Java's districts and cities from 2018-2022 by comparing two measurement models: the Social Mobility Curve (SMC), which focuses on income distribution and economic growth, and the Poverty Equivalent Growth Rate (PEGR), which incorporates poverty, inequality, and unemployment. Data and Method. Using data from Statistics Indonesia (BPS), the National Labour Force Survey (SAKERNAS), and the National Socioeconomic Survey (SUSENAS) for 2018-2022, this study applies the SMC and PEGR models and conducts panel data regression to analyse inclusive growth and its determinants. Results. The findings reveal that economic growth in East Java lacks inclusivity. Income distribution inequality persists across districts and cities, as shown by the SMC results. The PEGR model also indicates ongoing challenges in reducing poverty and unemployment inclusively. Key factors such as the share of manufacturing in GRDP and employment opportunities significantly impact inclusive growth. Conclusions. Encouraging investment growth can create a favourable business climate across all districts/cities, supporting a more equitable contribution to GRDP. As employment opportunities play a significant role in inclusive growth, boosting employment through investment can improve access to education and healthcare, while addressing unemployment. To combat inequality and poverty, the government must refine its data collection on the poor to better target beneficiaries.

Despite implementing several economic reforms and structural adjustment processes in various Arab countries, these efforts were not potent enough and policymakers were unable to enhance the standard of living in these countries. In fact, over the last seventeen years, the growth performance of the Economic and Social Commission of Western Asia (ESCWA) region as a whole was considered to be disappointing. The region suffered from the poor management of economic choices, weak governance and institutional frameworks, and corruption. As a result, inclusive economic growth in most of the ESCWA countries has not been readily implemented. Decades of prioritizing economic growth over inclusive growth and social equity have been the reason for high levels of wealth and income inequality in most of the ESCWA countries. This paper examines the role of economic institutions and macroeconomic policies on inclusive growth by generating a dynamic panel (GMM approach) for 16 of the ESCWA countries during the period between 2000-2016. Therefore, this paper aims to find out the determinants that widen the gap between economic and inclusive growth. The findings suggest that institutional variables (government effectiveness), financial deepening, government expenditure on health, years of schooling, and inflation have had a positive and significant impact on inclusive growth in the ESCWA region. In contrast, rule of law, and gross fixed capital formation have had a negative impact. The results suggest that inclusive growth implementation is all about governance with its overarching perspectives. Achieving good governance requires accountability, inclusiveness, and transparency within public affairs management.

Development is a multidimensional process that involves changes in social structure, which are based on the main orientation: the occurrence of economic acceleration, the reduction of inequality, and yet, the problem of poverty and unemployment remains an unresolved problem of absolute poverty reduction. Development also aims to achieve sustainable and inclusive economic growth. On the other hand the problem of poverty and unemployment remains as an unresolved issue. So it is necessary for the role of government, both local and central government, where the government is a driver and a planner of development. The goal is to eliminate three issues: unemployment, distribution inequality, and poverty, so that development outcomes can be enjoyed by the community fairly and evenly / inclusively. This study aims to find out which government spending can accelerate inclusive growth. This research used panel data method with simultaneous equation 3 stage least square. The results showed that capital expenditure had a negative effect on economic growth, while employee salary and population growth rate did not affect the economic growth. Capital expenditures, staff salaries, economic growth, and human development index affect the open unemployment rate. The open unemployment rate affects poverty, while economic growth has no effect on poverty. Key Words: Inclusive growth, local government spending, unemployment, and poverty.

Significant imbalances of existing development models are demonstrated by global economic growth, and outlines the need to move to a new more flexible and balanced model that is able to maintain the declared high and long-term growth rates together with the preservation of social equality and population general welfare. The purpose of the study is to identify EU comprehensive growth opportunities through of EU flagship initiatives achievement current EU situation in the field of poverty, unemployment, youth and women's unemployment and their involvement as labor force geographical aspects analysis; current state and prospects of EU inclusive development analysis; possibility of the sustainable development goals and inclusive growth based on the EU's flagship initiatives achievement substantiation. The object of the study is the process of inclusive economic growth within the EU through the EU flagship initiatives practical implementation. It is determined that along with traditional economic growth indicators it is necessary to take into account the human capital equality, ecological state of the environment, social protection, food security and social cohesion. Imperative knowledge on the interconnection of EU policy priorities and flagship initiatives, sustainable development goals and their compliance with inclusive economic development are systematized. The expediency of European inclusive economic growth model, declared in the “Europe 2020” strategy, design and implementation was grounded. Modern trends and geographical aspects of state of unemployment and poverty in the European region countries is determined. The level of women's participation in the European economy is analyzed. The level of women employment in comparison with men in the EU countries is analyzed, which made it possible to determine that this indicator is consistently lower, however, there is no significant disparity in most member states. It is substantiated that at the new cross-border economic order conditions, proposed by the EU, inclusive growth allows all member countries enjoy the progressive results of the union, economic integration and economic growth. Key words: inclusive growth, sustainable development, employment.

Before the COVID-19 pandemic, East Java Province (then abbreviated to East Java) made remarkable achievements in economic growth accompanied by a continuing downward trend in poverty. Then, after the COVID-19 pandemic broke out in 2020, it had a detrimental impact in terms of health, economics and social aspects. Specifically for East Java, the outbreak caused a severe contraction in the economy and significantly increased the number of local unemployed. However, long before COVID-19, East Java was facing wide inequality. Based on these problems, this study evaluates whether inclusive growth and local government fiscal intervention are solutions. These two factors have been recommended by economist as an effective strategies for reducing the triple problem in East Java. Fiscal intervention is interpreted as expenditure policies in economic, education, and health functions. Using panel data regression during 2015-2021, the study documents that economic growth in East Java still needs to be fully inclusive. This is based on the finding that inclusive economic growth does not simultaneously reduce triple problems (poverty, inequality and unemployment). Inclusive growth reduces poverty in East Java, but it has the opposite effect on unemployment and inequality. On the one hand, positive findings are documented in which fiscal intervention in education spending plays a significant role in reducing poverty. Unfortunately, this study failed to find the determining factors that provide a solution to inequality and unemployment in East Java. These evidences certainly have implications for reviewing the quality of inclusive growth and local government expenditure policies.

Whenever there is a question of environmental quality and inclusive economic growth, green and renewable energy consumption leads the debate. This paper explores the relationship between green energy consumption and inclusive economic growth. It employs GMM panel data modelling frameworks for understanding the “green energy vis-à-vis -growth paradox”. It uses post-COVID-19 data for eighty-three countries between 2010 and 2020. These countries are divided into high-, middle- and low-income as per the World Bank’s classifications. The selected composite variables are consisting of GDP growth, poverty, income equality and employment measures. The study reports that green energy positively contributes to inclusive growth despite its lower contribution to overall energy usage in low-income countries. It observes that socio-digital inclusion and green energy together impact positively on inclusive growth in all income groups (low, middle and high). This means citizens of the selected countries are aware of the pros and cons of green energy that helps countries to mitigate the negative impacts of countries’ transition to clean energy usage in terms of job losses, higher costs of clean energy and uncertainty to energy supply. Furthermore, results also reveal that green energy is significant contributor towards achieving inclusive growth, however it his highly significant in high income countries compared to other groups, showing its higher use in it. This comprehensive study is the first of its kind providing comparative analysis of 83 countries which explores and compares the interesting impacts of green energy consumption on inclusive growth in global data from the designated income groups.

Infrastructure development is an important aspect in economic growth because the existence of good infrastructure also has a positive impact on economic growth, thus creating new jobs, reducing poverty levels and increasing per capita income. Inclusive growth is a large part of sustainable economic growth as stated in the global agreement on the Sustainable Development Goals (SDGs). The purpose of this study is to analyze the effect of road, water, and education infrastructure partially and simultaneously on inclusive economic growth in the city of Mataram in 2017 - 2022. This study uses a quantitative approach and multiple linear regression analysis through the SPSS Program. The results of the study indicate that partially educational infrastructure as an independent variable has a positive and significant effect on the economic growth of the city of Mataram. The study indicates that inclusive economic growth in the city of Mataram in the last 6 years 2017 - 2022 does not show a large influence from the variables of road infrastructure, clean water and education infrastructure.

This Occasional Paper reviews financial stability challenges in countries preparing for EU membership with a candidate country status, i.e. Croatia (planned to accede to the EU on 1 July 2013), Iceland, the former Yugoslav Republic of Macedonia, Montenegro and Turkey. It follows a macro-prudential approach, emphasising systemic risks of financial systems as a whole. After recalling that some EU candidate countries went through a pronounced boom-and-bust credit cycle in recent years, the paper identifies current challenges for the bank-based financial sectors as mainly stemming from: (i) high or rising domestic credit risk; (ii) unhedged borrowing in foreign currencies; and (iii) strains related to the euro area debt crisis, which is impacting the EU candidate countries via a number of channels. The main channels of transmission of the euro area debt crisis to the EU candidate countries operate via: (i) trade and foreign direct investment; (ii) an increased market focus on sovereign risk; and (iii) “deleveraging”, e.g. via a decline of external funding to local subsidiaries of EU parent banks. A macro-stress-test exercise performed by the national authorities of the EU candidate countries in February 2012 suggests that large capital buffers can absorb a shock to credit quality stemming from a drop in economic activity in the EU and renewed strains from the euro area debt crisis. With respect to supervisory practices, the paper finds that the EU candidate countries have made good progress, but some gaps with respect to international and EU standards remain.

ABSTRACTThis paper addresses the study of inclusive growth from an urban perspective. It proposes to focus the relationship between urban economic growth and income distribution in cities in which manufacturing production and external demand play a central role. Opposed to the literature that considers economic growth leads to an increase in inequality in income distribution, we present some operative economic tools from Marshallian Industrial Districts theory and from urban economic theory with which to develop an economic strategy for inclusive urban growth, making possible to achieve simultaneously economic growth and improvements in income distribution. An interesting example of a metropolis with a dynamic of economic and employment growth compatible with a reduction in income inequality is provided by Barcelona. This metropolis disposes a Survey of living conditions and habits of the population since 1986 that allows an analysis in terms of inclusive urban growth.

The purpose of the study of this topic is inclusive growth and inclusive economic growth in the territory of the Republic of Uzbekistan. Using the theoretical method of analysis, the results of the developed countries of the world, as well as the state of the economy of Central Asia, in particular the Republic of Uzbekistan, are analyzed. The observation method reveals the impact of inclusive economic growth on the standard of living and well-being of the world’s population. The article compares data on the impact of the global economic and financial crisis on the economies of the world and the Republic of Uzbekistan, which began in 2019, and its consequences are reflected on inclusive economic growth. Projections of social development up to 2030 are made, this development factor plays an important role in inclusive economic growth. The result of this study is the conclusion about the importance of the inclusive growth index, which can replace the GDP indicator. Index of inclusive analysis of information on various aspects of society. This index can also be used to predict the socioeconomic development of the state.

Despite increasing income per capita, the EU candidate and potential candidate countries remain confronted with high levels of income inequality. The purpose of our paper is to identify the main determinants of income inequality among the EU candidate countries. In addition to macroeconomic factors, we also analyze the impact of demographic variables to provide more reliable estimates. Using panel data analysis with fixed effects in the period 2005-2017 for three EU candidate countries (North Macedonia, Serbia and Turkey) we find that the unemployment rate, the level of economic development and the investment rate are the main determinants whose increase leads to a bigger income differentiation in the analyzed countries. The government indebtedness has also a statistically significant, but a negative impact on income inequality. The other two macroeconomic variables in the model – the terms of trade and inflation are statistically insignificant. Among the demographic factors, population growth and education significantly affect income inequality among the EU candidate countries. The obtained results suggest that a sustainable economic growth combined with active measures in the labor market and the improvement of education level of the population could lead to more equal income distribution.

The article aims to solve the problem of unequal income distribution in Malaysia. Income inequality did not change significantly since 1990. Inclusive growth is an alternative way that can help the government overcome the unequal distribution of income. However, there are no measurements or detailed studies conducted in Malaysia. Moreover, the country’s distribution policy for the 2016–2030 period focuses on inclusive economic growth. Based on the above gaps, we constructed the Malaysia Inclusive Index and estimated the income distribution using this new composite index. To construct the index, we applied the Z-score method. We obtained data for this study from the World Development Indicator, Economic Planning Unit, Department of Statistics, Malaysia and annual reports from various ministries. The main research findings show yearon-year growth from 1990 to 2016, indicating that economic growth in Malaysia is increasingly inclusive. Therefore, to achieve inclusive and equitable economic growth in distribution, the government is advised to consider not only fiscal aspects, but also holistic components comprised of education, health, housing and employment of the B40 group (lower class). Simultaneously, the M40 group (middle class) should not be left out. Income distribution factors and the Malaysia Inclusive Index (MII) determinants such as investment, inflation, education and national income should be considered when developing national distribution policies, as these factors are crucial for inclusive growth in Malaysia

The finance sector is the lifeblood of any economy and its smooth functioning is central to rapid and inclusive economic growth. A well-functioning financial system must intermediate efficiently between savers and borrowers; manage risks prudently; provide a wide variety of financial services to firms, farms, and households; mobilize savings effectively; identify and lend for sound investments; remain robust in the face of shocks; and ensure that access to finance is available to all. This paper presents broad outlines of a reform strategy to develop a stable and efficient finance sector that supports rapid and inclusive growth in Myanmar.

Our main objective in this paper is to evaluate the economy-wide effects of alternative ways of financing expanded government spending on agriculture investments in selected African countries, with a particular focus on inclusive growth. Many African countries are typically, fiscally constrained and underinvest in agriculture despite its high share in economic growth as well as the high proportion of poor people residing in the rural sector. We use macroeconomic models that are then linked sequentially to a microsimulation model to understand the macro-poverty effects of interventions for each country. Government extra-spending on agriculture is financed successively by direct taxes, cuts in other expenditures and external financing. The results reveal that for countries to increase inclusive economic growth, they need to invest aggressively in agriculture and source the concessional finance externally where this option is available. However, it is also worthwhile for countries to explore combined mixes of external and domestic fiscal sources in order to optimise the impacts on inclusive economic growth. Our main contribution to the literature on poverty-growth-inequality triangle lies in the consistent modelling of the general equilibrium effects of the alternative financing mechanisms of agricultural investments for selected African economies.