Government Final Consumption Expenditure Research Articles

Financial Inclusion and Financial Development Determine Human Development in Selected Asian Countries

The research highlights the crucial role of accessible financial services and robust financial systems in enhancing human development outcomes, offering valuable insights for policy-makers aiming to foster inclusive economic growth. This research makes an effort to highlight that financial inclusion and financial development with other major factors determine human development in some selected Asian economies. The authors make use of panel data from 8 Asian nations for the year 2005 to 2018. The dependent variable is the human development index. However, financial inclusion, financial development, urban population, and general government final consumption expenditure are taken as explanatory factors in this analysis. Fixed effect results show that financial inclusion with financial development, urban population, and general government final consumption expenditures have enhanced the human development of Asian countries. The study findings recommend for maximum financial approach and financial amenities in improving the human development of nations. There is a dire need for more improved quality of education for high living standards and development.

Determinants of digital technology development in sub-Saharan African countries: evidence from panel data analysis

The primary objective of this research is to explore the elements that shape the progression of digital technology in Sub-Saharan African nations. The study employs data obtained from 16 countries, covering the period between 2000 and 2020. Employing fixed effect panel regression analysis, our research indicates that various non-technological factors significantly impact digital technology development in the region. The results highlight that variables including general government final consumption expenditure, inflation rate, employment growth rate, financial development, ease of doing business index, logistics performance index, international migration, access to electricity, and access to safe drinking water have a positive impact on the development of digital technology. Conversely, international trade is identified as a negative influence, primarily due to insufficient infrastructural development. These findings underscore the significance of non-technological elements, encompassing aspects like globalization, economic conditions, favorable digital ecosystems, and the fulfillment of basic human needs, in shaping the landscape of digital technology in the region. The study, while acknowledging limitations in terms of selected indicators, years, and countries, emphasizes the need for broader investigations in future research. Practically, the study suggests that governments in the region should prioritize addressing these non-technological factors to fully leverage the potential of digital technology development. The originality and value of this research lies in its exploration of non-technological determinants, shedding light on their pivotal role in shaping the digital technology landscape in sub-Saharan Africa.

The impact of unprecedented growth in public investment on stimulating the Indian economy

The aim of the article is to compare the effects of public investment and public consumption in the Indian economy. This issue is particularly relevant in the context of the unprecedented increase in public investment in India, which is becoming one of the biggest economies globally. The empirical research is based on a New Keynesian model. The novelty of the applied methodology lies both in the inclusion of public capital as a factor of production, and the partial substitution between public and private consumption in the model. The results show that government gross capital formation in the short run is a slightly more effective method of stimulating the Indian economy than government final consumption expenditure. However, the biggest differences between the effects of public investment and public consumption are evident in the long term. The impact of public consumption on GDP fades out quickly, while public investment raises the level of output for a long period. Government gross capital formation also affects employment and consumption more strongly than government final consumption expenditure does. Thus, the main implication of the study is to recommend increasing public investment in emerging markets, to boost their economies.

On the Impacts of Government Size on Economic Growth in India: Some Evidence from Smooth Transition Autoregression Model

This article examines the threshold effects of government size (measured as a percentage share of government final consumption expenditure in GDP) on economic growth from a non-linear perspective. We apply a smooth transition autoregression (STAR) model to estimate the threshold level of government size and its impact on economic growth in India for the period spanning from 1971 to 2019. The empirical results reveal that the relationship between government size and economic growth is non-linear. The study finds a statistically significant positive relationship between the size of the government and economic growth below the estimated threshold level of government size of 10.45 per cent. Above the 10.45 per cent threshold level, government size has a deleterious impact on economic growth. The results also reveal that the transition from one extreme economic phase to another is gradual. The findings of our study recommend that policymakers can enhance India’s economic growth by restricting government size to the estimated threshold level or by reducing the size of the government when it lies well above the threshold level. JEL Codes: JEL H00, JEL E6, JEL E62

An emprical study to investigate the size of non-governmental organizations in OECD countries

This study aimed to analyze the factors affecting the size of non-governmental organizations (NGOs) from a multinational perspective. Empirical analyses were conducted through econometric modeling, and the data of the 17 countries from 2003 to 2019 were used. The data was obtained from the World Bank and OECD database. We used advanced panel data estimation techniques (CUP-FM and CUP-BC) to obtain long-run coefficients. GDP per capita, general government final consumption expenditure, adult education at tertiary level, and Gini index growth declined grants by private agencies and NGOs? contribution to GDP (GinGDP) initially but after a threshold level, GinGDP increased with growth at later stages of these variables. Urban population growth, employment, and foreign population have reducing effect on the size of NGOs. The size of NGOs has bidirectional causality relationship between GDP per capita, adult population at tertiary education level, employment to population ratio, and Gini index; and unidirectional causality between urban population growth, general government final consumption expenditure, and foreign population.

Did the Economic Reforms Change the Macroeconomic Drivers of the Indian Economy in the Post-Reform Era? An ARDL Bounds Test Approach

Purpose: The purpose of this study is to investigate the macroeconomic forces that have been driving the Indian economy during both the pre-reform and post-reform eras, that is, from 1950-1951 to 1990-1991 and from 1991-1992 to 2022-2023 respectively. 
 Problem: The Indian economy underwent significant economic and financial sector reforms in 1991-92, with the goal of reviving its stagnant growth. These reforms are intended to spur the economic growth of India. What were the main forces behind the Indian economy before and after the reforms? Is the research question. The goal of the current study is to determine if the economic reforms shifted or maintained the pre-reform era’s driving forces for the Indian economy in the post-reform era. 
 Design/Methodology/Approach: The gross domestic product (GDP), the gross domestic savings (GDS), the private consumption expenditure (PFCE), the government final consumption expenditure (GFCE), the inflation rate, the exchange rate, the exports, the imports, the internal and external borrowings of the government, personal remittances, foreign direct investment (FDI), and foreign portfolio investments (FPI) are all taken into consideration in order to fill the research gap that has been identified as a result of the comprehensive review of the literature. Following an analysis of the selected variables' fundamental characteristics, an econometric model is developed using the Autoregressive Distributed Lag (ARDL) Bounds Test Model. 
 Findings: There is no evidence of long-run causation and association between the variables, but the findings of the ARDL Bounds Test showed that in the pre-reform period, PFCE is the major driver of the GDP in the short-run, with strong support from imports. However, since the reform, PFCE, GDS, and Exports are the primary short- and long-term contributors to GDP. 
 Practical Implication: These findings indicate that India's macroeconomic system is shifting. The Indian economy has undergone a dramatic shift, moving away from a reliance on imports and toward one that is consumer-driven and export-driven. As savings and consumer expenditures are the main drivers of the Indian economy’s growth in the post-reform era, policies should be designed to increase savings and consumption as well as increase exports.

Mineral rents, natural resources depletion, and ecological footprint nexus in high emitting countries: Panel GLM analysis

Natural resource depletion is a serious problem facing many countries today. As minerals and other natural resources are extracted from the ground, they are not replaced, leading to biodiversity loss and environmental degradation. The problem of natural resource depletion is compounded by the fact that, in many cases, mineral rents are not used to help replenish the resources being taken out of the ground. This study examines the impact of mineral rents and natural resources depletion on the ecological footprint in the high emitting countries from 1973 to 2019, using general government final consumption expenditure and international trade as moderating variables. Mineral rent and international trade are negatively associated with the ecological footprint. In contrast, general government final consumption expenditure and natural resource depletion are positively associated with an ecological footprint in the top emitting countries. Government expenditure and natural resource depletion deteriorate the environment, while mineral rents and exports of goods and services improve the environment. By investing in green technologies, the highest-emitting countries can reduce their ecological footprint and increase sustainability. In conclusion, the policy implications for mineral rents are clear – reducing the ecological footprint of the highest-emitting countries. By levying mineral rents, governments can ensure that companies pay their fair share for the resources they extract and raise revenue to fund environmental protection and renewable energy projects. This will help to reduce emissions and improve air quality, making the highest-emitting countries more sustainable in the long term.

The Impact of Inflation on Financial Sector Performance: Evidence. From. Western Balkan Countries

Abstract This research paper aims to investigate. the impact of inflation. on financial sector performance in Western. Balkan. countries. The topic was chosen considering the financial sector’s fundamental role and its. impact on sustainable economic growth. This impact is measured through the effect that macroeconomic determinants of financial. performance such. as inflation, GDP. growth, general government final consumption expenditure, trade, and the lending interest rate have on credit to private sector as a share of GDP and broad definition of money as a ratio of GDP, which were used to proxy financial sector development. The data are provided by the World Bank as well as the Central. Banks. of the respective countries, for the period 2002–2021. The research methodology consists of different panel regression models such as OLS, OLS robust, Fixed effects, Random effects, and Generalized method of moments (GMM). Findings indicate that domestic credit to the private sector and inflation are positively correlated, whereas broad money and inflation are negatively correlated.

Economic Growth Model of Ecuador with Upper Middle Income to Explain and Predict Productivity during the Period 2000-2022

Economic growth is one of the most widely used measures of a country's macroeconomic performance, although it is not without its critics. There are strong arguments that per capita gross domestic product growth can reflect an important part of the success or failure of policies implemented in an economy. The objective, to analyse Ecuador's economic growth model with high average income to explain and predict productivity over the period 2000-2022. The materials and methods, this line of research addresses a hypothetical-deductive and descriptive level of inquiry, by developing aspects from the global perspective concerning economic theory and implicit models of classical growth; such as the model that describes the Cobb-Douglas production function, to explain and predict the temporal behaviour of Ecuador's economic development. The above, in order to establish a correlational analysis of the contributions of the macroeconomic determinants of productivity. The response variable to be measured has been the gross domestic product per capita (GDPpc ) with respect to the independent variables: Domestic Savings (S), Gross Fixed Capital Formation (FBKF), Government Final Consumption Expenditure (G), Exports (E) and as a control variable represented by Labor Force (L). A systematic documentary search was carried out through databases: Scielo, Scopus, Google Scholar and Science Direct, to support the present research with contributions with articles of temporal relevance within the last 5 years. In addition, it was based on annual secondary data extractions from official sources such as the Central Bank of Ecuador (BCE) and the World Bank (WB), according to the temporal coverage from 2000 to 2022. Results, 23 temporal observations were analysed to build an econometric model under the adaptation of a Cobb Douglas production function to explain and predict the behavior of elasticity in Ecuador's economic growth, which establishes that 99.81% of the total variability present in the data is explained by the model that includes variations in savings, gross fixed capital formation, labour force, government final consumption expenditure and exports in the analysed period. Conclusions, the imports variable is eliminated as it is not statistically significant, the resulting model complies with the basic assumptions and the corresponding economic validation in terms of the signs of the estimates for the determinants of economic growth in Ecuador.

THE IMPACT OF ECONOMIC TRENDS ON BANK PROFITABILITY – THE CASE OF SERBIA AND CROATIA

This paper analyses the direction and intensity of the impact of economic trends on the profitability of banks in Serbia and Croatia in the period between the years 2006 and 2021. This paper aims to determine which indicators of economic trends have the most substantial impact on the profitability of banks in the selected countries. As key indicators of economic trends, GDP per capita, the GDP growth rate, inflation rate, real interest rate, broad money growth, general government final consumption expenditure, current account balance, gross savings, trade, and unemployment are selected as independent variables. At the same time, bank profitability was measured with bank return on equity, in percentages (ROE), and bank return on assets, in percentages (ROA) – two indicators which represent the dependent variables selected for this research. Descriptive analysis, mean difference, correlation, and univariate and multivariate regression were used in the research. Research results show that changes in real interest rates and unemployment have a significant impact on the profitability of banks in both of the selected countries, while changes in GDP per capita growth have a statistically significant effect only in Serbia, and general government final consumption expenditure has a statistically significant impact only in Croatia. The influence of other indicators of economic trends is not statistically significant.

Mineral resources depletion, environmental degradation, and exploitation of natural resources: COVID-19 aftereffects

Mineral resources are essential to our everyday lives but are finite and can be depleted if not managed responsibly. Unfortunately, many natural resources have been exploited and depleted due to unsustainable mining practices and over-consumption. This has led to environmental degradation in many parts of the world, with deforestation, air and water pollution, and soil erosion as expected consequences. This paper explores the impacts of mineral resource depletion and environmental degradation on natural resource uses in China from 1971 to 2018, considering the impact of general government final consumption expenditure from the perspective of COVID-19 aftereffects. Mineral resource depletion is negatively associated with natural resource rents in China. Environmental degradation and economic growth increase natural resource rents, depicting that as resources become scarcer, the rents associated with natural resources also increase. Governments must ensure that regulations are in place to protect the environment, invest in renewable energy sources, and support businesses transitioning from resource-intensive production. These policies will help ensure the environment is protected and resources are used responsibly and sustainably. Research limitations and future directions are discussed.

The Impact of Corruption on Economic Growth in Malaysia

The impact of corruption on economic growth has been the subject of theoretical debate among economists, with some arguing that corruption hinders growth and development. In contrast, others suggest that it can positively affect the development process. As such, the effects of corruption on economic growth remain inconclusive. This study examines corruption's impact on economic growth, as measured by real GDP per capita (constant 2015 US$) in Malaysia. The study utilized the autoregressive distributed lag (ARDL) method to investigate the relationship between corruption and economic growth in Malaysia. The data used in the analysis were obtained from the World Bank and International Country Risk Guide data repository and covered the period of 1992-2021 annually. The Corruption Index was used to measure corruption. At the same time, other variables included economic growth (GDP), Gross Capital Formation (GCF), General Government Final Consumption Expenditure (GE), Individuals Using the Internet (INT), Labor Force (LF), and School Enrollment (SE) in Malaysia. The study's primary results are as follows: (1) corruption and economic growth in Malaysia have a long run relationship when considering the measures of GCF, GE, INT, LF, and SE in the model; (2) when the measures of GCF, GE, INT, LF, and SE were included interchangeably and combined in the model, corruption had a positive and significant impact on economic growth in Malaysia; (3) corruption and economic growth in Malaysia have a significant short-run relationship when considering the measures of GCF, GE, INT, LF, and SE in the model. The study's limitation relates to the data used, as alternative corruption measures beyond the corruption index could yield different outcomes. The study's distinctive contribution is exploring the impact and relationship between corruption and economic growth, specifically in Malaysia.

Financial Liberalization, Institutions and Environmental Quality in GCC Countries

This paper examines the impact of financial liberalization and institutional factors on the environmental quality in GCC countries, specifically focusing on CO2 emissions. The study employs a panel ARDL model to analyze the link between these variables and environmental quality using data from a pooled mean group of GCC countries spanning the years 1984 to 2021. The study reveals several key findings. Firstly, it establishes a positive association between CO2 emission and democratic accountability. Secondly, corruption is found to hurt environmental quality. Additionally, the research indicates that ethnic conflicts contribute to a rise in CO2 emissions. Moreover, government stability is negatively linked with CO2 discharge. In GCC countries, the results demonstrate a negative connection between high domestic credit granted to the private sector and CO2 release. Furthermore, the study reveals a negative link between CO2 emission and GDP. Foreign direct investment is also shown to have a negative relationship with CO2 emissions, while urbanization and general government final consumption expenditure exhibit a positive relationship with CO2 emissions based on the findings of this research.

Environmental implication of energy policies and private and public subsidies on infant mortality rate: a sustainable development study of India.

India has remarkably achieved some level of decline in infant mortality rate and increase in aged person through increase in life expectancy due to improvement on its health care sector but still remain amongst the countries with the highest rate of infant mortality within the Asian countries. Literature on environmental implication remains scarce, and for this we utilised India's data from 1975 to 2020 to research on this topic. Relevant scientific methods (residual Augmented Least Squares - RALS, Engle and Granger - EG, and its newly augmented version - RALS-EG) are adopted in this study. Further, to estimate the long-run elasticities of the regressors, the symmetric analyses, i.e., dynamic ordinary least squares (DOLS) and Engle and Granger causality test techniques, are employed. Findings according to DOLS revealed that renewable energy sources and social (GDP per capita) and public subsidies (general government final consumption expenditure) have lessening effect on infant mortality in India, whilst the private subsidies (gross capital formation), fossil fuels, and carbon dioxide cause an increase in infant mortality in India. This exposes renewable energy source as a mitigating factor in Indian environmental degradation which as well lessen the infant mortality level in India; hence, policy is suggested to be framed on improving renewable energy and health sectors. The graphical presentation of the abstract is done with the diagram below. The graph shows the interactions amongst the selected variables in this study. The impacts of the explanatory variables on the dependent variable are shown with different colours showing positive (green) and negative (red) impacts.

Evaluating the Determinants of Exchange Rates in Emerging Markets: Evidence from Nigeria and South Africa

This paper evaluates empirically the determinants of exchange rates in emerging markets, with emphasis on Nigeria and South Africa during the period 2001-2020. By applying the pooled OLS regression method on both panel data and countries as subsamples, the study finds out that under the panel level, inflation rate, government final consumption expenditure and broad money had a negative effect on exchange rate, and that only government final consumption expenditure effect was significant. On the other hand, real interest rate, current account balance, economic health, GDP per capita, gross capital formation, and trade had positive effects on exchange rate, but only the effects of economic health, gross domestic product per capita, and gross capital formation were significant. For Nigeria, inflation rate and GDP per capita had negative non-significant effect on exchange rate, while the economic health had a negative significant effect on exchange rate; consequently, real interest rate, current account balance, gross capital formation, trade, government final consumption expenditure, and broad money had positive non-significant effect on exchange rate. For South Africa, inflation rate, economic health, and gross capital formation had negative non-significant effect on exchange rate, meanwhile government final consumption expenditure and broad money had negative significant effect on exchange rate; in addition, real interest rate, current account balance, and trade had positive non-significant effect on exchange rate, while GDP per capita had positive significant effect on the exchange rate.

Estimating the real exchange rate misalignment of the Algerian dinar during the period (1980-2019) : an empirical study (Arabic)

The aim of this study is to estimate the long-run Equilibrium Real Exchange Rate (ERER) and to assess the degree of misalignment of the Algerian Dinar for the period (1980-2019) using ARDL approach. Considering that the equilibrium exchange rate of the Algerian dinar is determined by a set of fundamentals of the national economy, the study reached the following main results: In the long run, there are positive relationships between the real effective exchange rate and the differential productivity, real oil price and net capital flows. Whereas, there are inverse relationships between the dependent variable and each of the trade openness, General government final consumption expenditure (% of GDP). The second result is that the REER registered a number of deviations from its equilibrium level, that vary between overvaluation and undervaluation. The third result is that the exchange rate cannot be the only adjustment variable, given the extent of macroeconomic imbalances (internal and external). Parallel efforts at fiscal consolidation and deep structural reforms to diversify the economy and accelerate growth are also essential.

ВПЛИВ ФІНАНСОВИХ, СОЦІАЛЬНИХ, ЕКОНОМІЧНИХ ДЕТЕРМІНАНТ ТА ФАКТОРІВ ГРОМАДСЬКОГО ЗДОРОВ'Я НА ШВИДКІСТЬ ВІДНОВЛЕННЯ МАКРОЕКОНОМІЧНОЇ СТАБІЛЬНОСТІ ЄВРОПЕЙСЬКИХ КРАЇН

This article aims to assess the impact of financial, social, and economic determinants and public health factors on the speed of restoration of macroeconomic stability in European countries. The study was conducted on the example of fifteen European countries (Albania, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Moldova, Poland, Romania, Serbia, Slovakia, Slovenia and Ukraine) based on fourteen relevant indicators during 2000–2022. Six indicators were selected using the principal components method to build a panel multivariate regression model. Using the Hausman test, it was determined that a panel regression model with fixed effects should be built for this set of data. Based on the results of regression modeling, it was found that the rate of restoration of macroeconomic stability has a positive, statistically significant effect on the level of electricity consumption and trade activity of the state and a negative, statistically significant impact on gross capital accumulation, state spending on final consumption, and the current account balance. It was found that with a unit increase in the level of electricity consumption and trade activity of the state, the rate of recovery of macroeconomic stability increases by 0.0001 and 0.004 units, respectively. In contrast, with the increase in gross capital formation, government final consumption expenditure, and current account balance per unit, the rate of recovery of macroeconomic stability decreases by 0.006, 0.014, and 0.01, respectively. No statistically significant relationship with current state spending on health care was found. In general, understanding the impact of financial, social, and economic determinants and public health factors on macroeconomic stability is vital for developing scientific theories and practical strategies and measures to ensure the stability of economies and protect citizens in crises. The relevance of this topic goes beyond purely theoretical considerations and directly affects the well-being and life of citizens, as well as the stability of states and the global economic system.

Identification of determinants of corruption in government: a mar-spline approach

Purpose.Development of a scientific and methodological approach to the identification of the most impactful determinants on corruption using multivariate adaptive regression splines. Methodology. Methodological tools of the research methods are comparison, grouping, bibliometric analysis, and multivariate adaptive regression splines in the form of piecewise linear functions. Findings. Systematization of the literary sources and approaches for factors influencing corruption indicates that most empirical studies are based on using panel data. Panel data allows you to insert general patterns, but does not consider the patterns of the national economy. For the study on corruption in Ukraine, 15 influencing factors were selected, characterizing the institutional, economic and social environment. Based on the constructed MAR Spline models, three regression equations were obtained that describe the linear dependence of the level of corruption in governance on the selected factors. The paper found that the relevant factors influencing corruption in Ukraine are: tax burden, general government final consumption expenditure, average monthly wage in Governance and rule of law. Originality.The proposed approach makes it possible to determine the dynamics of the degree of factor influence on the level of corruption in the country. The paper defines the threshold values of statistically significant indicators at which the maximum degree of correlation with the corruption perception index is achieved. Practical value.The regularities between the level of corruption and economic, institutional and social factors revealed by the research results can be used in the development of tools to fight corruption in Ukraine. The formation of an effective anti-corruption system will strengthen financial stability in the country and increase the level of public trust in society.

Analysis of the impact of macroeconomic factors on real estate prices in Bosnia And Herzegovina

Abstract Economic theory and practice are not acquainted with any unique set of macroeconomic factors that affect real estate prices. The very complexity of this phenomenon relativizes any attempt to establish an unchanged list of macroeconomic factors in BiH. The aim of the research in this paper is to analyze the impact of selected macroeconomic indicators on real estate prices in BiH, in the period from 2007 to 2019. Out of numerous macroeconomic factors that affect real estate prices (real estate prices are viewed as: the value of construction works done and as the value of new dwellings - new construction), 12 macroeconomic factors were singled out: nominal gross domestic product, real GDP growth rate, industrial production growth rate, GDP per capita, average net wages, imports and exports, household deposits in commercial banks, interest rate (housing loans, annual, %), loans to households, household final consumption expenditure, gross fixed capital formation and government final consumption expenditure. Starting from the hypothesis that macroeconomic factors affect real estate prices, it has been concluded that the selected factors significantly determine real estate prices and that most of the predictor variables defined in the model are significant, in terms of impact on the movement of GDP and real estate prices in Bosnia and Herzegovina in the period analyzed. The greatest impact on real estate prices is by household final consumption expenditure, GDP per capita, nominal GDP, interest rate, household deposits and real GDP growth rate. The research used factor analysis (reduction of macroeconomic factors to the optimal number of factors that explain the analyzed phenomenon and its impact on real estate prices) and an extended multiple linear regression model with a statistical software program SPSS, version 21. Modeling the impact of macroeconomic factors on real estate prices has macroeconomic effects and benefits for the country and contributes to the growth and well-being of operators in the real estate market.

The Impact of General Government Final Consumption Expenditure- Economics Growth nexus for the Gambia

Traditional Keynesian macroeconomic approaches states that extraordinary levels of government consumption expenditure increase employment levels of the population, productivity and investment levels through investment multiplier effects on aggregate demand. Thus, the spending of the government increases also raises aggregate demand to the right, causing output to increase depending on the magnitude and efficiency of expenditure multipliers on growth. The focus of this paper is to examining the impact of general government final consumption expenditure- economic growth nexus for the Gambia for the periods from 1977 to 2017. The econometrics techniques used is Ordinary Least Square (OLS) method to explore the impacts either negative or positive effects of government consumption final expenditure on growth in the Gambia for the periods under study Data for the study were obtained from World Bank(WDI). The findings were interpreted based on a 5 percent significance level of alpha. The multiple regression result revealed that government consumption was not a significant impact on the economic growth of the Gambia. This opposes the traditional Keynesian macroeconomic theory. This study suggested that Capital and recurrent expenditures on economic facilities should be directed mainly to productive economics. This will stimulate activities in the economic sectors like agriculture, industry and services, that will perhaps contrary the undesirable effect of government expenditure on economic growth especially in the Gambia in which the time series study was based.