ARDL Technique Research Articles

Political Leadership, Financial Efficiency and Investment Growth in Nigeria

The study examines the influence of political leadership, financial efficiency, trade, FDI and urbanization in Nigeria, using ARDL technique of estimation from 1980 to 2022. The stationarity test outcome shows that all the variable are found stationary and also the bound test found the variable fit for the long run analysis, since they have long run link. The result of the short run estimated outcome illustrates that political leadership, financial efficiency, trade and urbanization rise the level of investment growth in the country. However, FDI is not significant in explaining investment growth in the nation. The long run result reveals political leadership, financial efficiency, trade, FDI and urbanization have significant positive relationship with investment growth in Nigeria. Hence, the study suggest that good governance and promotion of the financial strength through innovative policies, planning and coordination for sustainable investment growth in Nigeria.

The Relation between Corruption and Economy in OECD Countries: A Moderating Role of Tax Revenue

This research study's goal is to examine how tax income influences the relationship between corruption and the economy in OECD countries. OECD countries 35 panel data from the years 1996 to 2021 have been used for this purpose. Economic growth is used as the dependent variable, corruption and tax revenue as the independent variables, and education, foreign direct investment (FDI), inflation, and governance as the control factors. First, we used the cross-sectional dependence CD test to check whether the cross-correlations of the errors are zero. Next, Panel unit-root test is used to check whether the data are stationary. Hausman test is used test to check whether endogenous regressors (predictor variables) are present in the regression model. Finally, Panel ARDL (PMG) techniques used for short-run and long-run analysis of variables. Similarly, the Baron and Kenny estimating process has been used to assess the direct and indirect link between these variables to discover the mediating influence between corruption, tax revenue, and economic growth. According to the panel ARDL (PMG) analysis's findings, economic growth is long-term positively impact by corruption, tax revenue, education, FDI, and governance. While inflation and political unrest have a negative and considerable impact on economic growth. The study's main finding is that tax revenue and corruption have a positive and substantial relationship with economic growth. The principal-Agent theory aids in understanding both governmental structure and the effects of corruption. The mediation analysis's conclusion is that corruption not only directly affects economic growth, but also indirectly. The study provides policymakers with comprehensive knowledge that decreasing corruption results in higher tax receipts and economic growth.

How do financial fragility and ICT penetration affect renewable energy consumption and green growth in top-polluting economies?

Green growth is an extension of traditional economic growth. Financial fragility and ICT penetration are important pillars of green growth sustainability. However, very limited studies have explored this association and provided conflicting results. Thus, our study intends to fill this vacuum by exploring the impact of financial fragility and ICT penetration on renewable energy consumption and green growth for the top five polluting economies over the period 1996-2020. In this study, financial fragility is measured by bank costs and bank non-performing loans. Panel ARDL technique is used to find out long-run and short-run results estimates. Financial fragility reduces renewable energy consumption and green growth in the long run. However, internet penetration enhances renewable energy consumption and green growth in the long run. Our findings suggest imperative policy implications for the green economy.

The Significance of Governance Indicators to Achieve Carbon Neutrality: A New Insight of Life Expectancy

This paper investigates the impact of life expectancy on carbon emission, in Saudi Arabia. Additionally, we examined the role of governance to achieve carbon neutrality status. We used the novel dynamic ARDL technique for estimations. This is one of the pioneer studies that analyze the role of life expectancy to control carbon emissions. The coefficients of life expectancy, education, and political stability are significantly negative. On contrary, governance effectiveness is an obstacle to achieving carbon neutrality. Empirical findings of life expectancy and governance effectiveness are quite surprising. In terms of Vision 2030 estimations, the coefficient of corruption control is significant and negative, indicating that the Saudi government has prioritized corruption control. While governance effectiveness remains positive, the Saudi government still requires governance reforms in order to achieve carbon neutrality goals.

Modelling the Impact of World Oil Prices and the Mining and Quarrying Sector on the United Arab Emirates’ GDP

In this research, we aimed to model the impact of world oil prices on the gross domestic product of the United Arab Emirates (UAE). The objective of the study was to determine the transmission mechanism of the influence of the changing oil price within the macroeconomic indicators of the UAE. In this study, we analysed the impact of world oil prices and the crude oil sector on economic growth in the UAE for the period of 2001–2020 by applying ADF, OLS, ARDL, and Granger causality techniques. The results also showed the direct impact of the changes in oil prices on the GDP of the UAE in the short and long terms; in other words, a decline in oil prices could pose a threat to the economic security of the UAE in the long term if appropriate corrective measures are not taken. In order to avoid these negative consequences of the oil price crisis, in this study, we emphasize that the only alternative to exporting oil is to diversify economic sources for long-term development and increase the efficiency of non-oil sectors.

The asymmetric impact of exchange rate misalignment on economic growth of India: An application of Hodrick–Prescott filter technique

Prior research that examined the effect of exchange rate misalignment on economic growth was based on the symmetric approach, which suggested that both overvalued and undervalued exchange rates would have a similar effect on economic growth. Recent studies, however, have demonstrated that the exchange rate tends to have an asymmetric effect on major economic variables such as trade flows and output economic growth. The current study seeks to explore the asymmetric effects of exchange rate misalignment on India’s economic growth. The findings demonstrate that. in the symmetric approach scenario, exchange rate misalignment negatively impacts India’s economic growth. However, after employing the non-linear ARDL technique, the study indicates significant evidence in favor of asymmetric effects. Intriguingly, the findings show that undervaluation promotes economic growth in the case of the Indian economy whereas overvaluation tends to affect it negatively. The study concludes that while an undervalued exchange rate may provide short-term economic respite, a market-based equilibrium exchange rate is essential for a growing economy like India.

Energy Resources, Investment Channels and Economic Growth

The research investigated whether energy resources increase the possibility for investment promotion and how they affect economic growth. In other words, the article explored whether energy could be used to support economic growth in Nigeria through investment. The analysis utilized secondary source of data from the World Bank's Development Indicators. The variables employed in the study included; Gross Domestic Product (GDP) being the dependent variable, Gross Fixed Capital Formation (GFCF), Foreign Direct Investment (FDI), Electricity and Natural Gas Rent (ENGR) and Openness (OPEN) spanning through 1980-2021. The methodology used in this study was dependent on the type of data collected and whose analysis was econometric in nature. The study performed a pre-estimation test via Ordinary Least Squares, and it was found that the result cannot be used for policy purposes due to some of the inherent problems associated with the estimation. This problem includes auto-correlation issues, multi-collinearity and others. This further propelled the study to conduct a post estimation test using the ADF statistics and the ARDL techniques of estimation and afterwards, the results showed a short run and long run impact of explanatory variables on economic growth. The study therefore recommended that the government should provide an enabling environment that will attract foreign direct investment, stimulate trade openness and also boost economic growth in Nigeria.

Institutional Quality and Economic Growth in Tanzania

In this paper, we use the ARDL method to find the Impact of institutional quality on economic growth in Tanzania from 1990 to 2021. The ARDL technique frees variables from residual correlation as all variables are assumed to be endogenous. They distinguish between dependent and explanatory variables in any long-run relationship, identify the co-integrating vectors with multiple co-integrating vectors, and derive the Error Correction Model (ECM) or Error Correction Model (ECM) Vector Error Correction Model (VECM) by integrating short-run adjustments with long-run equilibrium without losing extended-run information. Our results show all adjustment terms in the respective models that have a long-run relationship have correct (negative) signs and are more than one, implying there is convergence in the long run; that is, the models returned to their long-run equilibrium; the rate (or speed) at which this happened ranged between 15% to 106.6% annually. Institutional quality has a significant affirmative (0.047) causal long-run effect on economic growth

The Impacts of Energy Consumption by Sector and Foreign Direct Investment on CO2 Emissions in Malaysia

The global push for sustainable development has brought environmental issues to the fore. As minimizing environmental deterioration implies reducing energy consumption, this has come under intense discussion among economists and policymakers. This is because it may affect productivity, and thus slow economic growth ensues. Most earlier studies focused on overall energy consumption rather than energy use by sector to see how it can affect CO2 emissions. However, little research has been conducted on the connection between energy use in particular sectors, such as agriculture and transportation, and CO2 emissions. Therefore, this study aims to investigate the impacts of energy use in Malaysia’s transportation, industrial, and agricultural sectors and foreign direct investment (FDI) on CO2 emissions between 1989 and 2019. The ARDL technique is employed, and the results demonstrate that energy consumption in the transportation sector has a greater impact on CO2 emissions than in the industrial sector. On the other hand, energy use in the agricultural sector reduces CO2 emissions. These findings may help policymakers formulate the right policies in specific sectors to benefit communities. They will be at low risk of suffering from diseases attributed to environmental degradation.

The Debt-Growth Nexus in Nigeria: An Empirical Evidence

This study examines debt-growth nexus in developing countries, Nigeria, using annual data from 1986-2020. The data were sourced from CBN Statistical bulletin and WDI, ARDL techniques were employed to analyse the data. The findings of the study showed that domestic debt outstanding is negative related to growth in the long run though it is growth enhancing in short-run. External debt is negative related to advancement in long run while in short run is positive related. In the long run education is positive connected to growth but negative related to growth in the short run. The findings suggested that the national authority should channel both external and domestic debt to the education and infrastructural expansion which can lunch the economy to be more productive and diversified.

Can Renewable Energy and Export Help in Reducing Ecological Footprint of India? Empirical Evidence from Augmented ARDL Co-Integration and Dynamic ARDL Simulations

The objective of this study is to investigate the impact of exports, renewable energy, and industrialization on the ecological footprint (EF) of India over the period spanning from 1970–2017 by employing the newly developed augmented ARDL (A-ARDL) co-integration approach and the novel dynamic ARDL (D-ARDL) technique. The empirical results demonstrate that exports and renewable energy consumption reduce the EF, while industrialization intensifies the EF. More precisely, a 1% increase in export (renewable energy consumption) reduces the EF by 0.05% (0.09%). In addition, the short-run elasticity of the GDP is found to be larger than the long-run elasticity indicating the possibility of the existence of the Environmental Kuznets Curve (EKC) of the EF for India. The study indicates that the income effect and increased policy focus on renewable energy usage can be expected to reduce India’s per capita EF in the long run. Moreover, India’s export sector has been traditionally less energy intensive, which reflects in our findings of export growth leading to a reduction in EF. Based on the empirical findings, this study recommends some policy insights that may assist India to effectively reduce its ecological footprint.

Government Spending and Economic Growth: Keynes or Wagner for Cameroon? ARDL/T-Y-VAR Approach

This study had as primordial objective, to empirically investigate the nature of the link between government expenditure and economic growth in Cameroon from 1977-2018. To realise this objective, data were collected from the World Bank World Development Indicators and the ARDL technique was employed to examine the short and long run effects of government expenditure on economic growth in Cameroon. Then the VAR model, following the Toda-Yamamoto (1995) specification which is an ameliorated version of the traditional VAR model developed by Sims (1980) and Granger (1969) were employed to examine the nature of the link between the variables. The outcome from the ARDL model indicates that there is short run significant negative effect of government expenditure on economic growth while in the long run, there is a positive and insignificant effect. The result from the VAR model shows that there is a unidirectional causal relationship from growth to government expenditure. This result supports the Wagner’s law of expanding state activities for Cameroon. The findings suggest that instead of involving in increased spending as a means to guarantee sustainable growth, government should focus on policies that would create the enabling environment for growth to thrive like control of corruption and reforms in the financial sector to attract more private investment and the strengthening of state institutions.

Real exchange rate undervaluation, regional integration and services sector performance: evidence from the East African Community

We undertake to estimate the effects of real exchange rate misalignment and regional integration on the service sector performance in selected countries from East Africa during the period of 1991–2017. The main findings, based on the traditional Pooled Mean Group ARDL technique as well as the alternative panel Cross-Sectional Autoregressive distributed lag (CS-ARDL) approach render support for an undervaluation-led services sector performance as well as the importance of regional integration in the observed linkage. Additional evidence reveals that both the monetary policy and the fiscal policy are key channels via which currency undervaluation impacts on the services sector output. The existence of non-linearities in an inverted U-shaped curve is equally confirmed in the data, where small and moderate undervaluations spur service sector performance just as large undervaluations after some threshold hinder it. Exchange rate volatility is found detrimental to the services sector in the long run. Policies that would help promote the underlying catalysts of undervaluation, curtail exchange rate volatility as well as those that promote deeper regional integration should be strengthened. Likewise, undervaluation policies would yield optimal benefits to the services sector once they are accompanied by well-calculated monetary and fiscal policies.

Role of Governance, Trade, and Tourism in Foreign Direct Investment in Pakistan

The Primal objective of this research is to reveal the role of governance, tourism, and trade in the stimulation of FDI inflows in Pakistan. These forces have been integrated for empirical methodology after a detailed examination of past studies. The study took data set for selected variables from World Development Indicators (WDI) and World governance indicators (WGI) for the past two decades (2000-2021). Except for governance, tourism, and trade, this research incorporates macroeconomic stability and financial development as the stimulators of FDI inflows in Pakistan. In statistical data estimation, after using the ADF test, the ARDL technique is applied based on the variable's cointegration order. Both short and long-run estimates of ARDL confirmed the statistical significance of all studied variables that are governance (GOVEF), tourism (LTRSM), trade (TD), gross savings (GS), and broad money (BM). Bound test and CUSUM disclosed that there is long-run cointegration and the examined model is statistically significant and stable. Overall findings disclosed that GOVEF and trade are positively correlated, while LTRSM confirmed a negative association with FDI inflows for the case of Pakistan.

Foreign Direct Investment (FDI) Inflow and Insecurity in Nigeria: An Empirical Analysis

This paper empirically examines the impact of defence and security on foreign direct investment (FDI) in Nigeria using quarterly historical data covering the period of 1994q1-2019q4 and an ARDL and VAR econometric techniques are adopted as tools of data analysis. The results from both econometric approaches revealed that foreign direct investment responds negatively to the exogenous occurrence of security threats both in the short and long runs. Also, economic instability and uncertainty are shown to cause drag in foreign direct investment inflow in Nigeria. This study further shows that economic liberalization, proxy with trade openness, and economic progress, proxy with the growth of gross domestic product per capita contribute immensely to the flow of foreign direct investment into Nigeria. The study recommendations drawn from the findings are that national security challenges should be addressed without delay by the government at all the tiers levels to change the course of the downward trend of FDI in Nigeria; establish risk adverting policy to reduce economic uncertainty; promote price stability policy to reduce economic instability; diversifying the economy to further increase economic progress which greatly drives FDI inflow, and encourage economic liberalization which brings benefit through market expansion. Keywords: Insecurity, foreign direct investment, uncertainty, instability, trade openness Journal Reference Format: Omoniyi, O.B., Olasehinde, T.J. & Kekeroowo, I.O. (2022): Foregn Direct Investment (FDI) Inflow and Insecurity in Nigeria: An Empirical Analysis. Humanities, Management, Arts, Education & the Social Sciences Journal. Vol. 10. No. 2, Pp 1-12. www.isteams.net/humanitiesjournal . dx.doi.org/10.22624/AIMS/HUMANITIES/V10N3P1

Foreign Direct Investment (FDI) Inflow and Insecurity in Nigeria: An Empirical Analysis

This paper empirically examines the impact of defence and security on foreign direct investment (FDI) in Nigeria using quarterly historical data covering the period of 1994q1-2019q4 and an ARDL and VAR econometric techniques are adopted as tools of data analysis. The results from both econometric approaches revealed that foreign direct investment responds negatively to the exogenous occurrence of security threats both in the short and long runs. Also, economic instability and uncertainty are shown to cause drag in foreign direct investment inflow in Nigeria. This study further shows that economic liberalization, proxy with trade openness, and economic progress, proxy with the growth of gross domestic product per capita contribute immensely to the flow of foreign direct investment into Nigeria. The study recommendations drawn from the findings are that national security challenges should be addressed without delay by the government at all the tiers levels to change the course of the downward trend of FDI in Nigeria; establish risk adverting policy to reduce economic uncertainty; promote price stability policy to reduce economic instability; diversifying the economy to further increase economic progress which greatly drives FDI inflow, and encourage economic liberalization which brings benefit through market expansion. Keywords: Insecurity, foreign direct investment, uncertainty, instability, trade openness Journal Reference Format: Omoniyi, O.B., Olasehinde, T.J. & Kekeroowo, I.O. (2022): Foregn Direct Investment (FDI) Inflow and Insecurity in Nigeria: An Empirical Analysis. Humanities, Management, Arts, Education & the Social Sciences Journal. Vol. 10. No. 3, Pp 1-12. www.isteams.net/humanitiesjournal . dx.doi.org/10.22624/AIMS/HUMANITIES/V10N3P1x

Economic Freedom and Quality of Life in Asia: Fresh Econometric Evidence

This study empirically estimates the impact of economic freedom on the quality of life in Asia disaggregated by income level. Balanced panel data have been used in this study that covers the time period (2000-2021). The IPS panel unit root test is applied for the stationarity of the variables that show mixed order of integration so the panel ARDL technique is utilized. With respect to Lower Middle-Income Countries, we found that economic freedom, globalization, and official development assistance have a positive impact on quality of life, while development expenditure and remittances showed negative results on quality of life in the long run. With respect to Upper Middle-Income Countries, economic freedom, remittances, and official development assistance showed negative results while globalization and development expenditures showed positive impacts on quality of life in the long run. With respect to High-Income Countries, economic freedom, globalization, and development expenditures showed positive impacts while remittances showed negative impacts on quality of life in the long run. Economic freedom should be promoted in Lower Middle-Income Countries and High-Income countries. Upper Middle-Income Countries should keep an eye on institutional quality. The developed and rich countries should implement rule and law equally without any type of discrimination to get better results of economic freedom to provide a good quality of life.

The Impact of Financial Technological Advancement (FinTech) on the Economic Growth: Evidence from Palestine

This study examined the impact of financial technology FinTech on economic growth in Palestine, moreover, the study used annual time series data from the Palestinian Ministry of National Economy (MoNE), the Palestinian Ministry of Finance and Planning (MoFP), as well as the Palestinian Central Bureau of Statistics (PCBS) and the Palestinian Monetary Authority (PMA), in addition to investigating the current study of the impact of FinTech on Palestinian economic development for the period (2008 to 2021). In addition, the co-integration was evaluated using a distributed autoregressive approach, and a vector error correction model was used to consider long- and short-term causation. However, the data shows that FinTech products (number of people using the Internet, number of broadband subscriptions, number of mobile cellular subscriptions, number of automated transfer machines, number of branches) contribute to the growth in financial inclusion, which in turn fuels the growth economy in Palestine. Moreover, these results indicate that the (PMA) in Palestine is focusing more on expanding access to financial services. Moreover, this study aims to explore opinions and attitudes regarding the emergence of financial technology in Palestine's future financial services industry. The study’s objectives were also achieved by speaking to a group of managers in the banking and financial services industries, who were administrative employees from departments with technical, software and information technology departments, in addition to departments specialized in technological fields electronic payment services. The study analysis was performed based on the objectivity of the data collected. The approach used in this study was used to produce and rank data-related results for these traits and patterns. According to the findings of the study, it is critical that existing banking and financial institutions, academic institutions, technology companies and business incubators work together to build a supportive environment for the Fintech system in Palestine. According to the ADFGLS co-integration test results, all variables are stable at the initial difference. The results of the ARDL technique show that the co-integration of the variables occurs and that the null hypothesis is rejected. The VECM results show that fintech products have a long-term and short-term causal relationship with both economic growth and financial development. Thus, the results indicate that financial technology in Palestine has many obstacles: rules and regulations, cybersecurity, customer distrust of digital services, etc. All of this is believed to have a direct and beneficial impact on the Palestinian economy.

Re-examining the environmental Kuznets curve (EKC) for India via the multiple threshold NARDL procedure.

Irrespective of the vast array of empirical evaluations pertaining to the environmental Kuznets curve (EKC) hypothesis, both for India and other countries, previous studies, amid divergent submissions, inadvertently failed to highlight the relevant threshold that ensures significant reductions in environmental decay. Additionally, the implications of environmental-control technology on environmental quality are also lacking mostly in the context of Indian economy. Thus, this study enlists environmental-control technology and other relevant factors over the period 1980-2018 and employs the novel multiple threshold nonlinear ARDL technique, a model rarely applied in previous studies for updated empirical narratives. Accordingly, the empirical evidence rectifies that the variables converged to long-run equilibrium. Furthermore, from the tercile partial deviations, it is established that at the middle threshold (GDP2W2), pollution shrinks more significantly amid rising income, thereby validating the EKC hypothesis for India. Likewise, environmental-control technologies provided only a short-term insignificant carbon neutrality pathway, whereas they provided long-term insignificant emission increasing effects. This implies that the depth of such technology in India is inadequate to invoke cleaner environments at all times. Likewise, energy consumption and urbanization processes are significant environmental polluters, while trade openness provides insignificant long- and short-term carbon emission effects. Against this background, economic growth within the middle threshold promises a more sustainable environment amid rising national income at all times. Moreover, given its short-term outcomes, strengthening the depth of environmental-control technology is imperative to ensure a long-lasting clean environment in India.

THE IMPACT OF CLIMATE CHANGE ON ASEAN RICE PRODUCTION IN SHORT AND LONG-RUN

There has been a growing concern over the escalating signs of climate change that could adversely affect the production of rice in ASEAN region. This study attempts to assess the impact of climate change on food security measured in terms of rice yield, with the focus being on ASEAN member countries. Panel data are collected on nine ASEAN countries and static panel data equations are estimated. In addition, the dynamic panel ARDL technique is also adopted to investigate the long-term and short-term cointegration between the variables. The findings show mixed results of impact of CO2 on rice yield among majority of ASEAN member countries in short-run which signify the positive CO2 fertilization effect in the region over the adverse impact of temperature increase on rice yield. In long-run, however, the negative effects are projected which might reduce rice yield in this tropical area. Thus, serious collaboration between developing and least-developed countries in the region to address the issues in agriculture and rice production is very crucial to solve food insecurity within the region in the long-term.