Affect Economic Growth Research Articles

Does Current Account Balance Affect Economic Growth? Evidence from Sub-Saharan Africa

This study aimed to provide an econometric analysis of the impact of current account balances on economic growth in various subregions of Africa. It utilized the cross-sectional autoregressive distributive lags (CS-ARDL) technique and analyzed data from 1994 to 2022. The result showed that inflation has had an adverse effect on the Gross Domestic Product (GDP) in three specific regions. While the short-run influence of inflation on GDP may not be statistically significant, its long-term impact is notably negative. Foreign Direct Investment (FDI) has a negative effect on GDP in the short run; however, this effect is not statistically significant across the different economies. Over time, Foreign Direct Investment (FDI) has a negligible effect on the GDP in North Africa, but it has a negative and statistically significant influence in Central Africa. These findings emphasize the different regional dynamics in Africa and illustrate the intricate interplay between current account balances and economic growth. In conclusion this study affirmed the necessity for targeted economic strategies to combat inflation and utilize FDI for long-term growth.

Exchange rate fluctuations and industrial production in Malaysia: evidence from dynamic simulated ARDL analysis

Contemporary literature argues that the exchange rate serves as an important instrument of industrial policy to boost economic growth. However, it is difficult to design effective exchange rate policies owing to the uncertainty shrouding the outcomes of the exchange rate movement for industrial growth. Therefore, this study uses a dynamic simulated autoregressive distributive lags approach to study the impact of positive and negative changes in the real effective exchange rate on industrial production of Malaysia for the period 1970–2022. We employ an extended production function to study this relationship by incorporating capital, labour and globalisation as additional explanatory variables. The findings suggest that positive (negative) changes in real effective exchange rate are followed by positive (negative) changes in economic growth in the long run. Furthermore, positive changes in capital affect economic growth positively and significantly in both the short and long run. Finally, positive (negative) movement in labour and globalization positively (negatively) and significantly affect industrial production in the long run respectively. Policymakers should depreciate currency to expand industrial production in Malaysia. Moreover, to boost industrial production, short-term loans should be introduced for capital accumulation.

The Causality between Economic Growth, Public Debt and Government Spending of Lao PDR

This paper aims to test the causality between economic growth, public debt and government spending. This study used the time series data from 1995-2021 and implied with a VAR model and Granger causality test. In addition, the unit root, cointegration, Lagrange multiplier and Jarque-Bera test statistics was used. The empirical analysis by using VAR model found that public debt and economic growth have no effect on public spending. But government spending affects public debt in the same direction with a statistical significance level of 0.1 meaning that only government spending affects public debt, while public debt does not affect government spending. While government spending and public debt affect economic growth in the same direction with a statistical significance level of 0.01. For the Granger Causality Test, there is a unidirectional relationship means that only government spending and public debt affect economic growth, economic growth does not affect government spending and public debt.

Examining the Role of Local Government’s Financial Performance and Capital Expenditure in Increasing Economic Growth in Banten Province, Indonesia (2018–2022)

This study aims to analyse how financial ratios such as the independence ratio, effectiveness ratio, efficiency ratio, fiscal decentralisation ratio, dependency ratio, and compatibility ratio affect economic growth, directly or indirectly, through capital expenditure as a mediating factor. This research used a quantitative approach; purposive sampling was conducted, and path analysis was applied to explore the relationships between variables. The results show that self-reliance, effectiveness, efficiency, fiscal decentralisation, dependency, and capital expenditure significantly affect economic growth. The independence and effectiveness ratios have a positive impact, indicating that improvements in these variables directly foster economic growth. However, the efficiency and fiscal decentralisation ratios have a negative effect, suggesting that increases in these variables may reduce economic growth. Indirectly, through capital expenditure, the independence, effectiveness, dependency, and compatibility ratios significantly affect economic growth, with the independence ratio being the most dominant. Conversely, the fiscal decentralisation and efficiency ratios did not show significant indirect effects, indicating that capital expenditure is not an effective mediator for these variables. These findings provide insights into how local financial management strategies can influence regional development, offering key policy recommendations for Banten’s local government.

How Does International Trade Cum Regional Integration Affect Economic Growth? Insights from African Countries

How Does International Trade Cum Regional Integration Affect Economic Growth? Insights from African Countries

How Does Public Debt Affect Economic Growth? The Case of the New EU Member States

Purpose: This study investigates how public debt affects economic growth in eleven new EU member states in Central and South-Eastern Europe from 2000 to 2021. These countries are categorized into the Balkan, Baltic, and Visegrad groups based on their economic characteristics. Design/methodology/approach: The analysis employs a panel Autoregressive Distributed Lag (ARDL) model to explore the relationship between public debt and GDP growth, accounting for variables such as trade openness, population growth, inflation, and foreign direct investment. Findings: The results indicate a significant negative correlation between increasing public debt levels and GDP growth, with the effect being especially pronounced in Balkan countries. This negative association is evident both in the short term and long term, highlighting a greater sensitivity to public debt in less economically developed regions. Research limitations/implications: The study is limited by its use of annual data and its focus on specific geo-graphic areas. Despite these limitations, the research provides valuable insights into the complex relationship be-tween public debt and economic growth in new EU member states. Originality/value: This research offers important perspectives on the nuanced dynamics of public debt and econom-ic growth within the context of new EU member states, enhancing the understanding of these relationships in different economic settings.

Growth of Islamic Fintech in Indonesia

Islamic fintech is the latest breakthrough in finance that combines finance and technology using Islamic principles. Opportunities in developing Islamic fintech in Indonesia are also very wide open considering the large population of Indonesia who are Muslims. This research has two main objectives. The first objective of this study is to determine whether there is a difference between Islamic fintech and conventional fintech. The second and third objective is to determine whether Islamic fintech and conventional fintech affect economic growth in Indonesia. Independent T-test analysis is used to test the first objective, while regression analysis is used in this research method to test the second and third objectives. This research is a type of quantitative research. The data used is monthly time series data from January 2019 to December 2022. This research concludes that there are substantial differences between sharia and conventional fintech. This difference is caused by the large difference in the number and scale of sharia and conventional fintech businesses, namely 2%:98%. The impact of sharia fintech on Indonesia's economic growth is very small. The reason is that Sharia fintech in Indonesia is not yet operating optimally due to several obstacles. Apart from that, Indonesia's economic growth is greatly influenced by conventional fintech. This is due to the large number of assets and businesses which contribute 98% of total fintech assets

Do FDI And Trade Openness Affect Economic Growth Differently Across Income Groups? Case Studies From Asian Countries

This study examines the nexus between foreign direct investment (FDI), trade openness (TRO) and economic growth for selected 11 high-income and 22 middle- and low-income Asian countries within a model using a more recent panel dataset over the period 2000–2021. The cointegration test has been applied in this study, which shows that whether there is a long-term interrelationship between FDI and economic growth, which we focus on in particular, and then the covariance matrix estimators that are developed by Driscoll and Kraay are used. Our findings indicate that there is a positive relationship between FDI and TRO, and economic growth for high-income countries, whereas the relationship between FDI and economic growth is negative for middle- and low-income countries. This study provides insights on why governments and policy makers in developing countries should focus on prioritizing domestic investment and production strategies for sustainable economic growth rather than simply emphasizing the attractiveness of FDI and the indispensability of import-oriented trade liberalization.

Analyzing Macroeconomic Indicators that May Affect Economic Growth in Sub-Saharan African Countries: A Panel Data Analysis in the Context of Income Level Classification (1990-2019)

The purpose of the study was to ascertain whether the export-import coverage ratio (EXIM), the income of natural resources (NATR), labour force participation rate (LFPR), and foreign direct investment (FDI) had a positive or negative impact on economic growth for 34 Sub-Saharan African countries using data from 1990 to 2019. The change in Gross Domestic Product Per Capita (%) is used in the study as a proxy for the economic growth variable, and Sub-Saharan African nations were categorized based on the United Nations' income classification system to create more homogeneous groups and consequently more accurate analysis results. To do this, 34 Sub-Saharan African nations were divided into three income categories: lower-middle-income, upper-middle-income, and low-income. The income categories established by the UN were considered while drawing this distinction. This divide led to the analysis of 18 low-income nations, 12 lower-middle-income countries, and 4 upper-middle-income countries. One of the dynamic panel data analysis techniques, the two-step system GMM panel data analysis, was used as the econometric analysis approach. According to the estimations, FDI in lower-middle-income sub-Saharan African countries was statistically significant and inversely related to economic growth; it was observed that the coverage ratio of exports to imports has a statistically significant and linear relationship. None of these independent variables were found to influence economic growth in low-income sub-Saharan African countries. There is a statistically significant correlation between the LFPR and NATR and economic development in the upper-middle income category of nations analyzed. As a result, the influence of factors varied and fluctuated on economic growth based on the income levels of different groups.

How does equity derivative market affect economic growth? Evidence from the Asia‐Pacific region

AbstractThis research scans the association between economic growth and derivatives markets in the Asia‐Pacific region between 2001 and 2022. Using the autoregressive distributed lag model, we reveal a bidirectional linkage between derivative markets and economic growth. We further demonstrate that both derivatives and stock markets have a strong positive association with economic growth, underscoring the significance of financial markets in driving economic advancement. We suggest policies prioritizing sustainable economic development and regulation of financial markets, particularly derivatives and stock markets, to increase market transparency, reduce information asymmetry, and foster economic growth.

Does Military Expenditure Affect Economic Growth in the Developing Countries?

خلال الخمسين عامًا الماضية ، كان هناك كم هائل من الدراسات التجريبية حول تأثير الإنفاق العسكري على النمو الاقتصادي في البلدان النامية ، باستخدام منهجيات وتقنيات ونماذج اقتصادية مختلفة. وعلى الرغم من ان العديد من هذه الدراسات التجريبية تستخدم منهجيات متنوعة خلال العقود الأربعة الماضية ، إلا أنها لا تقدم إجماعًا حاسمًا . لسد الفجوة في الأدبيات ولفحص الآثار الاقتصادية للإنفاق العسكري في 64 بلدًا ناميًا في الفترة من 2017 إلى 2022 ، تستخدم هذەالورقە نموذجًا محددًا وتقدم أدلة تجريبية تستند إليه. وذلك باستخدام تقنيات بيانات اللوحة ، تظهر النتائج بشكل متسق أن هناك علاقة إيجابية بين النمو الاقتصادي والإنفاق العسكري في البلدان النامیە في العينة. پوختە لە ماوەی چوار دەیەی ڕابردوودا لێکۆڵینەوەی ئەزموونی زۆر لەسەر کاریگەریی خەرجییە سەربازییەکان لەسەر گەشەی ئابووری لە وڵاتانی تازەپێگەیشتودا ئەنجامدراوە. میتۆدۆلۆژیا و تەکنیک و مۆدێلی ئابووری پێوانی جۆراوجۆر بەکارهێنراون، کە لە ڕێگەی توێژینەوە و پانێڵ داتاکانی نێوان وڵاتانەوە گرنگی بە ٦٤ وڵاتی تازە پێشکەوتوو دراوە. سەرەڕای زۆری و فرەچەشنی ئەم توێژینەوەیە، بەڵگەکان لە سەر بوونی پەیوەندی نێوان (خەرجی سەربازی - گەشەی ئابووری) هێشتا بێ ئەنجامن. ئەوەی جێگەی تێڕامانە، تەنیا ژمارەیەکی سنووردار لە لێکۆڵینەوەکان ئەم پەیوەندییەیان لەناو بواری فراوانی وڵاتانی تازەپێگەیشتودا لێکۆڵیەوە. بۆ چارەسەرکردنی ئەم بۆشاییە، ئەم توێژینەوەیە مۆدێلێکی داتاکانی پانێڵ بەکاردەهێنێت بۆ پێشکەشکردنی تێڕوانینێکی ئەزموونی سەبارەت بە کاریگەرییە ئابوورییەکانی خەرجییە سەربازییەکان لە سەرانسەری 64 تازە پێشکەوتو لە ماوەی 2017-2022. بەگشتی ئەو ئەنجامانەی کە بە بەکارهێنانی شێوازەکانی توێژینەوەی داتاکانی پانێڵ بەدەست هاتوون ئاماژە بەوە دەکەن کە خەرجییە سەربازییەکان بەشدارن لە پێشخستنی گەشەی ئابووری لەو وڵاتانەی کە لە نمونەکەدا هاتووە

How Does Information and Communication Technologies Affect Economic Growth? A Comparative Analysis of the Economies of the European Union and Asia-Pacific Region

How Does Information and Communication Technologies Affect Economic Growth? A Comparative Analysis of the Economies of the European Union and Asia-Pacific Region

How does population growth affect economic growth and vice versa? An empirical analysis

How does population growth affect economic growth and vice versa? An empirical analysis

Moderating Effect of Public Debt on Protective Expenditure and Economic Growth of Nigeria

This study evaluated the moderating effect of public debt on productive expenditure and economic growth in Nigeria for the period of thirty one years, from 1993-2023. Ex-post facto research design was adopted. Administrative expenditure and transfer payment are proxies for protective expenditure while real gross domestic product is indicator of economic growth. The data used in this study were secondary data derived from the Central Bank of Nigeria Statistical Bulletin while public debt data was sourced from Debt Management Office Annual Reports. The study used multiple regression analysis. The regression result revealed that administrative expenditure has positive significant effect on economic growth but when moderated by public debt showed significant influence on economic growth in Nigeria. Meanwhile, transfer payment has no significant effect on economic growth but when moderated by public debt revealed an insignificant effect on economic growth in Nigeria. The study concluded that administrative expenditure affect economic growth while, transfer payment has no effect on economic growth. The study recommended that Government should direct more of its protective expenditure towards administrative expenditure as they accelerate economic growth. Also, proper management of public funds allocated to the administrative operations as they have the potential of raising the nation’s production capacity and providing employment for citizens in the country.

Does Monetary Policy and Fiscal Policy Affect Economic Growth during Covid-19 Pandemic: Evidence from Indonesia

Indonesia is an archipelago with more than 200 million inhabitants when the COVID-19 pandemic occurred. The Indonesian government implemented several strategies to maintain economic stability during the Covid-19 pandemic. Some strategies that are carried out to maintain economic growth are monetary policy and fiscal policy. This study aims to determine the effect of monetary and fiscal policies on Indonesia's economic growth during the Covid-19 pandemic. The model used in this study is the ARDL model. The results showed that MP had a positive and significant effect on the GDP variable in the current year. However, it negatively and significantly affected the GDP variable in the past year. FP variable has a positive and significant effect on the GDP variable in the current year. However, it has negatively and significantly affected the GDP variable in the last 2 years. The DCOV variable or dummy variable has a positive and significant effect on the GDP variable before COVID-19 and a negative and significant effect on the GDP variable after COVID-19.

Unlocking the potential of renewable energy and natural resources for sustainable economic growth and carbon neutrality: A novel panel quantile regression approach

As the world grapples with the dual challenge of fostering sustainable economic growth and achieving carbon neutrality, the role of renewable energy, urbanization, and financial development in shaping environmental outcomes in South Asian nations becomes increasingly critical. In this pioneering study, we delve into the heart of South Asia, encompassing a diverse range of nations – Afghanistan, Bangladesh, Bhutan, Pakistan, Sri Lanka, Nepal, the Maldives, and India – each chosen for their strategic geographical significance and the rich availability of pertinent data, offering a unique lens into the region’s energy and economic dynamics. This research uses panel quantile regression analysis to examine the relationship between the renewable energy consumption, broad money, urbanization, and natural resources and their effects on carbon emissions and economic development in South Asian (SAARC) nations. Fixed-effect panel quantile regression analysis was used to adjust for geographical variability. This study aims to investigate how urbanization, broad money, natural resources, and renewable energy affect economic growth and carbon emissions. According to our research, renewable energy consumption significantly and negatively affects CO2 emissions, especially in the distribution’s higher quantiles. Urbanization has a positive and significant effect on GDP, whereas natural resource rent has a positive impact on GDP and CO2 emissions. Broad money boosts GDP in the lower quantiles while having a negative impact in the higher quantiles. These findings show that in order to combine economic development with environmental sustainability, governments must concentrate on boosting the use of renewable energy sources and encouraging sustainable urbanization. Our policy implication is that policymakers should prioritize policies aimed at promoting renewable energy consumption and sustainable urbanization, which can help mitigate the negative environmental impact of economic growth in the SAARC region.

Does Carbon Policy Uncertainty Affect Economic Growth? Empirical Evidence from Enterprises ‘Industrial Profits in China

Does Carbon Policy Uncertainty Affect Economic Growth? Empirical Evidence from Enterprises ‘Industrial Profits in China

The Influence of Regional Income on Economic Growth and its Implications for the Human Development Index in East Java

Financing of government administration based on the principle of decentralization is carried out at the expense of the APBD. In the context of implementing government and services to the community based on the principle of decentralization, the regions are given the authority to collect taxes / levies and manage natural resources, the source of funds for the regions consists of Regional Original Revenue, General Allocation Funds, and Special Allocation Funds. This study aims to determine the effect of PAD, DAU, DAK, Village Funds and Revenue Sharing Funds on Economic Growth and its impact on the Human Development Index in East Java Province. This research was conducted using quantitative description analysis and analyzed using path analysis. The data used in this study used secondary data obtained from the financial statements of the East Java Provincial Government or the website of the East Java Provincial Government and the Regional Statistics Planning Agency of East Java Province. The results of this study indicate that PAD, DAU, DAK, Village Funds and Revenue Sharing Funds on Economic Growth in East Java Province means that there are 5 factors that can affect economic growth the higher and the value of funds obtained can increase economic growth. PAD, DAU, DAK, Village Funds and Revenue Sharing Funds affect the Human Development Index in East Java Province where the higher the value of funds obtained by the city / district area can increase the human development index in the area itself. Economic Growth affects the Human Development Index, meaning that economic growth that occurs due to economic activity in a region affects the human development index due to economic activity. PAD, DAU, DAK, Village Funds and Revenue Sharing Funds affect Economic Growth and the impact of the increase in the Human Development Index, this happens because the 5 factors that are the source of funds in each region are managed to increase economic growth and are accompanied by an increase in the human development index.

Does Human Capital and Gender Equality Affect Economic Growth for Ten Province in Sumatera?

Does Human Capital and Gender Equality Affect Economic Growth for Ten Province in Sumatera?

In a Search for Contemporary Growth Drivers: Does Public Healthcare Entrepreneurship Affect Economic Growth?

Entrepreneurship has been long recognized as an essential driver of economic growth. It is widely accepted that entrepreneurship increases innovation, firm formation, employment, and overall GDP. Despite the increasing research on both public entrepreneurship and entrepreneurship in healthcare, these different research areas have not been combined that much. To fill this research gap, this paper analyses whether public healthcare entrepreneurship influences economic growth. This study exploits the WHO Global Health Observatory database approximating various dimensions of entrepreneurship by specific aspects of compliance with international healthcare regulation. The study uses data for 170 countries from 2010 to 2019. Using the fixed effect panel setting, it tests whether improvements in public healthcare entrepreneurship (PHE) affect a country's economic growth. The results suggest that higher entrepreneurial orientation in public healthcare is associated with larger effects on output per capita, which is channelled through productivity. However, after reaching certain level of PHE development, the contributions to growth start diminishing. The findings from this paper produce several implications. First, by exploring the nexus between public entrepreneurship and healthcare entrepreneurship it introduces the concept of public healthcare entrepreneurship explaining its theoretical and empirical importance. It further provides empirical and quantitative support to the view that developing public healthcare entrepreneurship plays a role in achieving a higher output per effective worker. Thereby, this study provides evidence of a non-linear relationship between public healthcare entrepreneurship and growth. Finally, given the statistical and economic significance of the results, these findings motivate policymakers to consider developing policies that guide developing entrepreneurial orientation within public healthcare. We believe this is possibly the first study that considers entrepreneurial orientation withing a public sector into the economic growth discussion.