Endowed Countries Research Articles

Resilience to economic shrinking: reinterpreting the Asian economic miracle in a comparative perspective, 1964–2018

ABSTRACT The successful economic performance of Pacific Asia is often held as a source of inspiration for aspiring catching-up countries. Notwithstanding, recent literature suggests that a key to the understanding of successful long-term economic performance lies not only in the ability to generate economic growth, but in limiting incidences of economic shrinking. Such analyses to explain the Asian economic miracle are however in short supply. This study highlights the significance of economic shrinking in Asia in a comparative perspective to demonstrate how and why resilience to economic shrinking was a significant aspect of the successful development of the region. To approach the question of why some countries became more resilient than others we propose a social capability framework and apply it to a sample of 26 developing countries between 1964 and 2018. We construct a social capability index on which we develop a set of simple OLS regressions to estimate the impact of social capabilities on shrinking patterns. We demonstrate that poorly endowed countries do not lack the ability to generate growth, but their limited resilience prevents them from catching up.

Country-of-origin effects on technology transfer in foreign direct investment

This study investigates the role of foreign direct investment (FDI) and its country-of-origin in technology transfer. Using data of 95 countries from 2008 to 2019, results indicate that net inflows of the FDI are positively related to technological transfer especially in developing countries. This is consistent with the findings that show fewer resources endowed countries benefited from advanced technologies and management know-how. Furthermore, results suggest different country-of-origin affects the technology transfer of the host economy differently. These results are consistent with studies that suggest the FDI origins are crucial to expose firms with variety of technologies and management practices. Results from quantile analysis prove that there is an existence of a threshold for the developed and developing countries to gain from the country-of-origin of the FDI. Therefore, we need to relook at the investment policies of the host countries to maximize the benefits from different sources of FDI.

The Perception of Teachers on Integration of Information and Communication Technology (ICT) Into Mathematics Teaching and Learning

Integration of Technology in the teaching and learning process has gained recent attention, most especially whether it favors less endowed countries like Ghana. The purpose of the study was to find teachers' perceptions of the integration of ICT into Mathematics teaching and learning in Ghanaian Senior High Schools and discover the potential barriers hindering effective ICT integration. The population comprised all teachers in the Greater Accra Region. A simple random sampling was used to select the teachers. Two public mixed and one private mixed school from the Ga South Municipality were purposefully selected. A total of twenty-five (25) teachers and sixty (60) students were selected from the three schools. The research design for the study was a mixed method research design. Questionnaires were administered personally to the teacher. The findings revealed that 95.8% of the teachers have not been using computers in their classroom instruction even though they have access to computers in their schools. It was also discovered that 83.3% of the schools do not have specialized software for teaching Mathematics installed on the computers in their laboratories. It is therefore recommended that specialized software for teaching and learning Mathematics be installed on the computers in the various Senior High Schools laboratories to enable the mathematics teachers in the SHS to have access to them and use them in their teaching.

한국어 ‘문화어휘’ 교육 방안 연구

This paper is designed to testify if Korea’s ODA contributed to the economic development of its recipient countries. In order to pursue the topic, a theoretic model is constructed, which ultimately proves if ODA can enhance the welfare of any recipient country. In the model, the direct effect of Korea’s ODA is distinguished from its indirect effect while taking a networking effect into consideration. The direct effect means that ODA itself can be used as inputs for expanding the economic size of recipient countries. In contrast, the indirect effect measures the ODA’s contributions to the infrastructure development of recipient countries. In the long-run, ODA, entangled with the recipient country’s internal resources, can create positive joint contribution to the economic welfare for recipient country group; this effect is named to be the networking effect. The model makes three important predictions. In general, the marginal contribution of a donor country’s ODA may not be greater than that of a recipient country’s. Thus, a negative view on the role of ODA can prevail. However, ODA is able to create a networking effect even within poorly resource endowed countries. Furthermore, from the perspective of total effects, the marginal networking effect of ODA becomes to outweigh the direct and indirect effects of ODA in the long run. Some empirical works prove these predictions. First, in terms of total effects, Korea’s ODAs are shown to have significant and positive effects on the welfare of recipient countries. Second, a larger total effect is found even within African countries compared to other areas, which coincides to the predictions of the model. Hence, in terms of total welfare contributions, Korea’s ODAs can be said to have contributed the economic growth of recipient groups.

자원배분의 관점 하의 ODA가 수원국에 미치는 경제발전 효과

This paper is designed to testify if Korea’s ODA contributed to the economic development of its recipient countries. In order to pursue the topic, a theoretic model is constructed, which ultimately proves if ODA can enhance the welfare of any recipient country. In the model, the direct effect of Korea’s ODA is distinguished frsom its indirect effect while taking a networking effect into consideration. The direct effect means that ODA itself can be used as inputs for expanding the economic size of recipient countries. In contrast, the indirect effect measures the ODA’s contributions to the infrastructure development of recipient countries. In the long-run, ODA, entangled with the recipient country’s internal resources, can create positive joint contribution to the economic welfare for recipient country group; this effect is named to be the networking effect. The model makes three important predictions. In general, the marginal contribution of a donor country’s ODA may not be greater than that of a recipient country’s. Thus, a negative view on the role of ODA can prevail. However, ODA is able to create a networking effect even within poorly resource endowed countries. Furthermore, from the perspective of total effects, the marginal networking effect of ODA becomes to outweigh the direct and indirect effects of ODA in the long run. Some empirical works prove these predictions. First, in terms of total effects, Korea’s ODAs are shown to have significant and positive effects on the welfare of recipient countries. Second, a larger total effect is found even within African countries compared to other areas, which coincides to the predictions of the model. Hence, in terms of total welfare contributions, Korea’s ODAs can be said to have contributed the economic growth of recipient groups.

Resource Curse in WAIFEM Member Countries: An Application of Seemingly Unrelated Regression

Even though empirical evidence has shown that naturally endowed countries growth slower than their less naturally endowed counterparts, the scenario tagged as “resource curse hypothesis”, but it seems there are exceptions. Therefore, this study examines the confirmation or disputation of resource curse hypothesis among the West African Institutes for Financial and Economic Management (WAIFEM) member countries during the period 1986-2016. The study applied seemingly unrelated regression (SUR) and unraveled the strengthened effect of natural resources on output growth in Gambia, Ghana, and Sierra Leone. But, the study revealed a negative and statistically significant effect on economic growth in Liberia and Nigeria, thereby upholding the presence of resource curse hypothesis only in Liberia and Nigeria. Therefore, an overall “umbrella” policy recommendation inappropriate, but individually designed strategy that would help in managing the resources rents effectively in order to boost economic growth particularly in Liberia and Nigeria where their resource endowment serve as a curse rather than a blessing is recommended.

Persistence of nitrogen oxides emissions using historical time series data: evidence from 37 countries

ABSTRACT Two features in time series data: the existence of time trends and the degree of persistence, are examined in this work on the nitrogen oxides emissions from 37 OECD countries. Updated techniques in time series are used that allow for fractional degrees of differentiation in the data. Thus, if the number of differences required is one, nitrogen oxides emissions are not mean reverting in the sense that if there is an exogenous shock (resulting from a technological advancement to change nitrogen oxides emissions), the effect of such shock on nitrogen oxides emissions will be permanent. Time trends are observed in half of the series. For these countries the trend coefficient is found to be positive in all cases. This is an indication that continuous technological progress is needed in taming NOx emissions. In addition to developing their own local technologies, less technologically endowed OECD countries should engage in collaboration with the more technologically endowed countries in order to facilitate increase in trans-border transfer of technology. The technologically advanced countries should also strive to continue to introduce better technologies in a bid to reduce NOx emissions. Most of the results show evidence for persistence of nitrogen oxides emissions.

Are Energy Endowed Countries Responsible for Conditional Convergence?

We test for economic convergence in GDP per capita and consumption per capita within two distinct sets of countries: those with significant (and plausibly exogenous) fossil fuel (FF) endowments and those without such endowments. Among countries with FF endowments, we find evidence of both absolute and conditional convergence across both macroeconomic dimensions, as indicated by standard P- and o-convergence tests. By contrast, we do not find robust evidence of convergence among countries without FF endowments. This pattern—convergence among FF-endowed and non-convergence among non-endowed countries—is robust to changes in the sample period, controlling for potential resource curse effects, and is largely consistent across growth components. We discuss the implications for economic development and comment on its implications for global decarbonization policies.

Digitalization and Banking Crisis: A Nonlinear Relationship?

This study assesses the impact that ICT can have on the occurrence of banking crisis for a sample of 113 countries over the period 1996–2017 while considering the interfering role of corruption and the potential existence of a nonlinear relationship for the ICT-banking crisis nexus. We consider countries with varying income levels to check for the stability of the relationship. Our estimation results show that more highly ICT endowed countries can improve the resilience of the banking system. The study provides evidence that ICTs do not produce the same effect regardless of a country’s level of income. Estimation outcomes show the existence of a threshold effect driving the ICT-banking stability nexus. More results show that Information and communication technologies can improve the stability of the banking system only when corruption is relatively low. However, when corruption is endemic, ICT endowment is useless for the stability of the banking system.

A case for establishment of the Ferrous Materials Development Network (FMDN) in South Africa

South Africa is known to be one of the mineral endowed countries in the world, bearing large quantities of iron, chrome, manganese and vanadium reserves that are key to iron and steel industries. It is thus vital to leverage on this natural resource endowment to build a dynamic industrial economy capable of creating sustainable jobs. Central to achieving this goal is the need to derive greater economic value from these natural resources, which will reduce import levels and create export opportunities. Currently, however, the local iron and steel industry is forced to navigate some of the known challenges such as the cost of energy, transportation, labour and steel, in order to remain competitive and operational. These matters which hamper the realization of beneficiation aspirations do not only have a huge impact on the downstream value-adding steel industry but also make the cost of doing business in SA unattractive. Consequently, based on its capability, relevancy and experience in supporting the iron and steel sector for many years, Mintek has been entrusted with the responsibility to host the Ferrous Materials Development Network (FMDN) by government through advanced materials initiative (AMI) programme to coordinate research on ferrous materials in the country. The purpose of this paper is to illustrate the need for interdependent research activities in ferrous materials in South Africa, which is underpinned by collaborative research, development and innovation (RDI) efforts between science councils, academia and industry. These activities are aimed at generating local know how, fostering local and international collaboration, development of human capital (HCD), supporting job creation through beneficiation, identification of relevant advanced technologies to improve competitiveness, localization of designated castings, design and development of new ferrous materials with enhanced properties to enable access to niche export markets as well as improving local capability to produce high-end ferrous products for critical sectors of the economy such as petrochemical, energy generation, transportation, mining, etc.

Nutritional Management Approach for Possible Prevention of COVID-19 Infection and Transmission in Sub-Saharan and Biodiversity Endowed Countries

The causative etiology of the viral pneumonia outbreak in the Wuhan province of China of December 2019 initially identified as “novel-Coronavirus-2019” and today called “Corona Virus Disease-2019 has been identified as “severe acute respiratory syndrome coronavirus-2 (SARS-CoV-2)”. Tireless efforts have therefore been invested to elaborate a treatment and/ or vaccine though with much controversy due to the lack of proper mastery of the structure, mode of action, mutation, recombination and transmission mechanism of the virus. Numerous public health measures have thus been imposed to slow down the rate of invasion and/or transmission (regular hand washing, face mask wearing, quarantine as well as method of diagnosis and symptomatic treatment) and now a convinent and acceptable treatment protocol and/ or vaccine. With the difficulties encountered in the development of an effective and efficient control and / or preventive towards the virus even in the western world, countries in sub-Saharan Africa, especially those in the tropics like Cameroon will endure sigficant consequences due to limited funds, technology, equipment and experts. It is therefore imperative to exploit other possibilities as the recombination rate and mutation possibilities within the genome of SARS-CoV-2 is indicative that, the 2019 outbreak was just a tip of the iceberg as more virulent variants beyond Delta variants, are still to emerge. One of such suitable and affordable possibilities is to nutritionally fortify and prepared the body to fight against infection. Zinc, Copper and Sellenium are essential micronutrients with demonstrated viral chelating activities found in selected commond foods which in adequate amounts will strengthen the immune system and tonify the body energy. A non-exhaustive list of common foods rich in the indicated micronutrients as well as those endowed with antioxidant and antimicrobial properties have been established from an extensive literature search in order to emphasize on the regular consumption.

Can Traditional Authority Improve the Governance of Forestland and Sustainability? Case Study from the Congo (DRC)

With about 107 million hectares of moist forest, the Democratic Republic of Congo (DRC) is a perfect paradox of a natural resources endowed country caught in repeated economic and socio-political crises. Democratic Republic of Congo possesses about 60% of the Congo basin’s forest on which the majority of its people rely for their survival. Even if the national forest land in the countryside is mainly exploited by local populations based on customary rights, they usually do not have land titles due to the fact that the state claims an exclusive ownership of all forest lands in the Congo basin including in DRC. The tragedy of “bad governance” of natural resources is often highlighted in the literature as one of the major drivers of poverty and conflicts in DRC. In the forest domain, several studies have demonstrated that state bureaucracies cannot convincingly improve the governance of forestland because of cronyism, institutional weaknesses, corruption and other vested interests that govern forest and land tenure systems in the country. There are however very few rigorous studies on the role of traditional leaders or chiefdoms in the governance of forests and land issues in the Congo basin. This research aimed at addressing this lack of knowledge by providing empirical evidence through the case study of Yawalo village, located around the Yangambi Biosphere Reserve in the Democratic Republic of Congo. From a methodological perspective, it used a mixed approach combining both qualitative (field observations, participatory mapping, interviews, focal group discussions, and desk research,) and quantitative (remote sensing and statistics) methods. The main findings of our research reveal that: (i) vested interests of traditional rulers in the DRC countryside are not always compatible with a sustainable management of forestland; and (ii) influential users of forestland resources at the local level take advantage of traditional leaders’ weaknesses—lack of autonomy and coercive means, erratic recognition of customary rights, and poor legitimacy—to impose illegal hunting and uncontrolled forest exploitation.

The Biofin approach to biodiversity conservation in urban ecosystems: The case of Bangalore in India

With the adoption of the Aichi Biodiversity Targets (ABT) in the year 2010, the impetus for finding financial solutions to the problems of biodiversity loss in the world has gained momentum. The Biodiversity Finance Initiative or Biofin, which was launched in 2012 as a UNDP – European Commission project has been designed to help biodiversity endowed countries attain ABT through the formulation of ‘optimal ‘and ‘evidence based’ biodiversity finance plans. The objective of this paper is to explore how the Biofin approach can be strategized to implement Target 4 of the Aichi Biodiversity Targets that deals with ‘sustainable production and consumption’ in an urban setting. The paper takes up the concrete case of the fast- growing city of Bangalore in India, to explore the extent to which biodiversity loss in the city and its surrounds has been linked to unsustainable production and consumption practices. The paper concludes by highlighting the potential role of Biofin in creating altered urban policy frameworks that could transform Bangalore into a circular economic system. It is argued that the study holds significance to other similarly situated large cities in the developing world like Sao Paulo, Mexico City and Mumbai.

A game-theoretic analysis of international trade and political conflict over external territories

For analyzing conflict between two large open countries over external territories rich in natural resources, we develop a game-theoretic model of trade under resource appropriation possibilities. We show that greater trade openness (by lowering trade costs) reduces the overall intensity of arming when the adversary countries are symmetric in all dimensions. This finding is consistent with the liberal peace hypothesis that trade reduces conflict. We further analyze how equilibrium is affected by differences in national resource endowments. The resulting asymmetric equilibrium reveals that arming by the more endowed country exceeds that of the less endowed country and the two adversaries respond to lower trade costs differently: the more endowed country cuts back on its arming, whereas the less endowed country may increase it. Under resource endowment asymmetry, the aggregate arming allocations of the adversaries could increase despite greater trade openness.

MACROFINANCIAL RESPONSIBILITY OF CENTRAL BANKS: THEORETICAL FOUNDATION AND INSTITUTIONAL DILEMMAS

Introduction. Prediction that price stability as well as inflation targeting in commodity rich countries is very fragile typically based on logical relation between commodity prices fluctuations and macroeconomic instability. But in the same time, while counter-cyclical instruments appear, commodity prices shock should be taken as supply shock. Thus, inflation instability in resource rich countries should be taken as consequences of macroeconomic mismanagement. Purpose. The purpose of the paper is to validate rejection of fatalism in negative influence of resource richness on price stability. Also it is important to show that inflation targeting regime compatible with large commodities export. In the same time it is necessary to take into account political regime as a supporting factor of adoption that regime of macroeconomic policy that is consistent with price stability. Results. It is proved empirically that commodity abundance per se is not in conflict with price stability. We rich such conclusions basing on simple multifactor regression model that combine macroeconomic policy regime dummies (maturity of inflation targeting, sovereign wealth fund in operation, central bank independence, exchange rate regime) and structural features of the resource rich economies like commodity export, economic complexity, financial depth, democracy. On example of 68 resource rich countries it is shown that price stability parameters (mean inflation, 1999-2017 and standard deviation of it) are not in undoubtfull relation with fraction of nonmerchandise export, but they are in opposite relation with inflation targeting and sovereign wealth funds dummies. Resource endowed countries are not homogenous from political regime point of you. Such regime is important driver of macroeconomic policy choice. Advanced democracies are likely to choose inflation targeting, flexible exchange rate and central bank independence, while wealthy autarkies are likely to prefer fixed exchange rates and sovereign wealth funds. It is mean that price stability is not just vulnerable to commodity factor but is to unstable political regime under which it is hard to implement counter-cyclical regime of macroeconomic policy. Conclusions. Commodity wealth is not precondition to price instability. But political regime is important activate that type of macroeconomic policy regime that consistent with low and stable inflation. By the structural features Ukraine is closer to democracies with mean level of economic complexity and financial depth. Due this inflation targeting regime is more appropriate meaning priority of price stability and exchange rate flexibility.

The role of financial development in the oil-growth nexus

It is expected that possessing the natural resources could faster increases the pace of growth in natural resource endowed countries. However, history has shown that this is not the case for some resource rich countries. In the current study, hence, we assess whether more developed financial markets can channel the revenues from oil into more productive activities and thus offset the negative effects of oil abundance on growth. To this end, we adopt the common correlated effect mean group estimator to account for the high degree of heterogeneity (because of substantial cross-sectional dependence in our data) for a core sample of 63 oil-producing countries from 1980 through 2010. The empirical results show that oil abundance affects the growth rate in output based on the degree of development in financial markets. In other words, better financial development dampens the negative impact of oil abundance on economic growth.

The effects of institutions and natural resources in heterogeneous growth regimes

The dependence on natural resources is the subject of a wide debate in the analysis of economic growth in rentier States. Up to now, there is no consensus about the way natural resources could impede or boost the economic development of such endowed countries. The same mitigated results are found concerning the interaction between institutions and growth. In this paper, we examine the combined interaction effects of natural resource dependence and the quality of institutions on economic growth by using a panel threshold regression methodology. We show that the effect of natural resource dependence on economic growth becomes positive when the quality of institutions improves. Moreover and contrary to many precedent results in the literature, it appears that an increase in natural resource dependence wipes out the positive effect of institutional quality on growth. Indeed, a positive variation of the quality of institutions does not necessarily lead to a positive variation in economic growth.

Export diversification: How much does the choice of the trading partner matter?

This paper studies how a country's export diversification varies across destination markets. It develops an extension of the Romalis (2004) model which yields two testable predictions. According to the first, exports between similarly endowed countries (“South–South” and “North–North”) are more diversified than exports between differently endowed countries (“South–North” and “North–South”). The second implication is that, for given countries' production patterns, low bilateral trade costs lead to greater export diversification. These predictions find empirical support in a panel of 102 trade partners and 4998 HS-6 industries over the period 1995–2007. Results show that similarities between trading partners in physical capital, land and human capital endowments per worker are associated with more diversified bilateral exports. Exports are also more diversified when bilateral trade costs are relatively low.

Indigenous Knowledge and Biodiversity Conservation in Sabah, Malaysia

Feasibility of existing indigenous knowledge that maintain customary practices are relevant for management, conservation and sustainable use of biological diversity in Sabah. The status of knowledge among indigenous communities involving both practical and embedded spiritual beliefs, i.e. indigenous people is still maintaining their hunting seasons. These seasons are upheld based on the knowledge about breeding seasons, patterns of different species and also particular about hunting areas. The purpose of this paper is to assess the indigenous system towards agricultures, river and resources management. This paper also aims to report the level of the indigenous people towards biodiversity and their perceptions of biodiversity conservation in general. Environment is an invaluable award from God and it is our responsibility to manage the natural resources with a good care. Over centuries, human being is facing substantial challenges to perpetuate and nurture the environment which results from the increase of consumerism and the development of a nation. The challenge to conserve sustainable ecosystem and protected environment has lead to some debates concerning conservation and biodiversity issues elsewhere. Biodiversity has emerged at the centre of one of the most contentious global debates of this century. Critical to the debate are questions of how biologically endowed countries can achieve economic progress while balancing environmental and social concerns (1). This argument is closely related to the question of how biodiversity and traditional knowledge among indigenous people could establish meaningful collaboration towards biodiversity conservation of a mega diversity country, such as Malaysia. Malaysia is among the world's twelfth biodiversity-rich countries in terms of the number of species, and fourth in Asia, behind China, India and Indonesia. The flora and and fauna of Sabah, Malaysia is one of the notable natural features and the number of wild plant species is likely to be approximately of 10,000 species (2). The natural ecosystem of Sabah supports a diversity of animal life including orang-utans, elephants and diverse of jungle animals, bird species and diverse marine which can be found off Sabah's coast . Moreover, the existence of large percentage (60%) of indigenous communities in Sabah also supports the natural resources and sustainable environment (3). In this context,

Krugman Trade Theory and Developing Economies

This paper examines the founding of a new trade theory which has won Nobel Prize for Paul Krugman. The theory is an explanation of the actual pattern of trade between similarly endowed countries in respect of factor endowments, tastes, technology, etc., as against the classical theory of trade between differently endowed countries. It takes the aspects of monopolistic competition of product differentiation or distinction, large scale production, decreasing costs or increasing returns. The theory has many lessons for the developing economies like India, for which strategic trade policy is a good policy option, for bringing out the variety of trade potentials of the country.