Granger Causality Techniques Research Articles

Government Health Expenditure and Maternal Mortality: The Moderating Role of External Debt.

The impact of government health spending and external debt on maternal mortality has been the subject of ongoing theoretical and empirical discussions. However, this relationship has remained controversial with no perspective on the moderating role of external debt on the government's health expenditure and maternal mortality link. This study examines the moderating effect of external debt on the government's health expenditure and maternal mortality relation using data from 13 Southern African economies spanning from 2000 to 2022. We employed the augmented mean group, the dynamic common correlation effect mean group, and the Driscoll-Kraay and Granger causality techniques to attain the study's objective. The outcome revealed that government health expenditure and external debt reduce maternal mortality in the Southern African Development Community (SADC) region. Equally, the magnitude of government health spending is moderated by external debt. The results revealed a bidirectional relation amidst maternal mortality and government health expenditure, and maternal mortality and external debt. The study recommends that policymakers within the SADC zone should avoid austerity measures and encourage expansionary measures in terms of spending, and the contraction of debt for capital investment in the health sector. This will enhance the delivery of health services within the zone and equally reduce the rate of maternal mortality that is still a major health concern within the sub-region.

Can Renewable Energy Be a Driving Factor for Economic Stability? An In-depth Study of Sector Expansion and Economic Dynamics

India has emerged as one of the world's most appealing locations for renewable energy development. It has set lofty renewable energy goals to reach 450 gigawatts (GW) capacity by 2030. These aims indicate India's determination to move to greener and more sustainable energy sources. India has been investing in R&D to promote technological innovation in renewable energy. This includes improvements to solar photovoltaic technology, wind energy, energy storage technologies, and smart grid systems. Innovation is critical for improving efficiency, lowering prices, and increasing the reliability of renewable energy sources. This paper aims to analyse the linkages between economic growth and renewable energy usage in India. For this, the Granger Causality technique is adopted, and it is found that no short-run causality exists among the economic growth and RE installed capacity. However, Industrial Production Granger Causes both GDP and Renewable Energy Capacity. When the stock price data of the last five years of top renewable energy companies was also collected, it was found that all the companies are showing an upward trend. While renewable energy is growing rapidly, especially solar and wind power, it is insufficient to meet the bulk of India's energy demands. Renewables contribute to reducing carbon emissions and diversifying the energy mix, but they still account for a smaller percentage compared to thermal power.

Analyzing the Interaction Among Tourism, Life Expectancy, and Unemployment in Japan: Insights From Cointegration and Conditional Causality Approach

ABSTRACTThis study explores the dynamic interconnectedness among tourism, life expectancy, unemployment, and economic growth in Japan from 1995 to 2023. Despite numerous studies on these variables individually, comprehensive analysis on their interconnections is lacking. Using Bounds testing, ARDL models, and Granger causality techniques, we reveal significant insights into these relationships. The analysis confirms a long‐run co‐integration among all variables, indicating a stable equilibrium over time. In the short run, tourism and life expectancy positively impact economic growth, underscoring their crucial roles in driving Japan's economy. Conversely, the link between unemployment and economic growth is negative and statistically insignificant, suggesting that short‐term unemployment fluctuations do not substantially affect economic performance. Granger causality analysis shows bidirectional causality among economic growth, tourism, and life expectancy, indicating mutual reinforcement and interdependence, while unemployment reveals unidirectional causality. The findings emphasize the need for policies supporting tourism development and as strategic avenues for sustainable economic growth.

Sex-dependent nonlinear Granger connectivity patterns of brain aging in healthy population

BackgroundBrain aging is a complex process that involves functional alterations in multiple subnetworks and brain regions. However, most previous studies investigating aging-related functional connectivity (FC) changes using resting-state functional magnetic resonance images (rs-fMRIs) have primarily focused on the linear correlation between brain subnetworks, ignoring the nonlinear casual properties of fMRI signals. MethodsWe introduced the neural Granger causality technique to investigate the sex-dependent nonlinear Granger connectivity (NGC) during aging on a publicly available dataset of 227 healthy participants acquired cross-sectionally in Leipzig, Germany. ResultsOur findings indicate that brain aging may cause widespread declines in NGC at both regional and subnetwork scales. These findings exhibit high reproducibility across different network sparsities, demonstrating the efficacy of static and dynamic analysis strategies. Females exhibit greater heterogeneity and reduced stability in NGC compared to males during aging, especially the NGC between the visual network and other subnetworks. Besides, NGC strengths can well reflect the individual cognitive function, which may therefore work as a sensitive metric in cognition-related experiments for individual-scale or group-scale mechanism understanding. ConclusionThese findings indicate that NGC analysis is a potent tool for identifying sex-dependent brain aging patterns. Our results offer valuable perspectives that could substantially enhance the understanding of sex differences in neurological diseases in the future, especially in degenerative disorders.

Nexus between Climate Change, Technological Inputs, Energy Consumption and Cereal Production in India: An ARDL approach

Agriculture is vital to India's economy and food security but is highly vulnerable to climate change. This study examines the impact of rainfall, temperature, arable land, energy consumption, fertilizer, and technology inputs on cereal production in India from 1965 to 2018 using ARDL and Toda-Yamamoto Granger Causality techniques. Results show temperature negatively affects cereal production, while rainfall, arable land, energy, fertilizer, and technology have a positive impact. There is a unidirectional causal relationship between these factors and cereal production. The study suggests adopting modern technology, prioritizing organic farming, educating farmers, investing in agricultural R&D, and developing sustainable irrigation infrastructure.

How Does Tourism, Trade Openness and Green Energy Influence CO2 emissions? Evidence from ASEAN Countries

This study explores the effects of Tourism (TOU), Gross Domestic Product (GDP), Foreign Direct Investment (FDI) and Trade Openness (TOP) upon carbon di oxide emissions (CO2). The article has taken top seven tourist destinations in ASEAN (Association of Southeast Asian Nations) through 2000-2020. The approaches used to analyze results are autoregressive distributed lag (ARDL) and secondly the Granger causality technique. The data is panel data; hence we can also say it is panel ARDL. The outcomes exhibited an interesting relationship between the variables under study. Where, GDP, TOP and TOU were significantly and positively correlated with CO2. Whereas FDI showed huge and negative correlation with CO2. The results of the study showed that in the long run there is a significant association between FDI, TOP and TOU and carbon emissions. The study findings are thoroughly examined, accompanied by analysis of policy implications and recommendations for future research.

Empowering Pakistan’s Economy: The Role of Health and Education in Shaping Labor Force Participation and Economic Growth

The labor force is a crucial factor in conducting economic activities, especially in labor-surplus countries like Pakistan. In this study, we explore the impact of labor force participation (LF) on economic growth (EG), with an emphasis on how this impact depends on the levels of health and education expenditures. We analyze time series data from Pakistan spanning from 1980 to 2022, using ARDL (Autoregressive Distributed Lag), ECM (Error Correction Model) and Granger causality techniques for empirical analysis. The ARDL results indicate that LF significantly boosts EG, both in the short and long run. Furthermore, the estimations reveal that better facilities for health and education strengthen the positive effects of LF on EG. This suggests a complementary relationship between health, education, and LF in driving EG. Moreover, our findings highlight the temporal significance of health and education: Health plays a more crucial role in the short run, while education’s impact is more substantial in the long run. Furthermore, the Granger causality results indicate that LF, health, and education significantly contribute to EG. It is advisable for the government to prioritize investments in the health and education sectors. This approach can empower individuals to actively and effectively participate in economic activities, eventually contributing to the overall economic output of the nation.

In the Context of Okun Law, the Relationship Between Real Output and Unemployment Rate in Oecd: a Panel Error Correction and Panel Ardl Approaches

In this paper, the correlation between unemployment rate and real output for OECD countries was analyzed through the application of Okun’s Law and unemployment hysteresis 2007-2022. For this purpose, panel error correction, panel cointegration, ARDL Bounds Test and Granger causality techniques were preferred. In addition, unemployment hysteresis was examined with different panel unit root technique in OECD countries. The findings show that there is a long-term link among the variables, while supporting unemployment hysteresis in most OECD countries. Long-term findings show that Okun’s law is applicable. Causality analysis indicates that there is a one-way and negative relationship towards the unemployment rate. The estimation for the long-run coefficient shows that the increase in growth leads to a decrease in the unemployment rate. Short-term findings also support long-term outcomes.

HUMAN RESOURCE ACCOUNTING AND BANKS PROFITABILITY: EVIDENCE FROM DEPOSIT MONEY BANKS LISTED ON THE NIGERIAN EXCHANGE GROUP

This paper investigates the connection between human resource accounting (HRA) and profitability of listed deposit money banks (DMBs) in Nigeria for period, 2010-2020. While controlling for size effect, this aims to determine the effect of salaries and wages, directors’ remuneration, and retirement benefits and costs, on banks’ profitability (proxy by Return on Asset (ROA)). Secondary data sourced from published annual financial statements of nine purposefully selected DMBs quoted on the Nigerian Exchange Group, were analyzed using Panel Autoregressive Distributed Lag (P-ARDL) model and panel Granger causality technique. This study reveals that retirement benefits and costs, and directors’ emolument exert positive and significant effect on ROA while salary and wages has positive but non-significant effect on ROA. Furthermore, there is a unidirectional causality flow from ROA to salaries and wages and banks size. It is therefore concluded that investment in human resources have positive and significant effect on the profitability of banks in Nigeria and banks profitability dictates their wage-paying ability and size. It is recommended that banks should investment more in their HR particularly by providing a much more guaranteed retirement benefits to their employees and also handsomely rewarding their currently serving directors and employees.

Sustainable development spillover effects among selected Asian countries: Analysis of integrated sustainability perspective

This study aims to investigate how different pillars of sustainable development in Iran interrelate with those in Russia and Saudi Arabia from the perspective of integrated sustainability. For this investigation, it assesses the spillover effects of sustainable development in these countries by estimating their sustainability elasticities. It maps the regional spillover effects between the sustainability of Iran versus those of Russia and Saudi Arabia using SEY model by estimating the elasticities of sustainability with a combination of Simultaneous Equations System, Vector Autoregressive (VAR) model, and Granger causality technique. The results confirm the integrated sustainability perspective in terms of the interconnection of sustainable development spillover effects from Russia and Saudi Arabia to Iran. Most of the estimated coefficients are statistically significant, showing high elasticities of sustainability and considerable spillover effects which confirms the perspective of integrated sustainability with spillover effects as the 4th pillar of sustainability. However, the results reject both weak and strong sustainability perspectives. According to the findings of this study, policy-makers should follow flow-based governance instead of local-based governance. In this approach, strategists should improve the international relationship with other countries, especially Iran, Russia, and Saudi Arabia. Moreover, decision-makers should establish a peaceful and strong connection with other countries via signing international agreements, treaties, and understandings.

Examining green productivity amidst climate change technological development and spillovers in the Nordic economies

The common ground of both critics and proponents of green productivity is arguably hinged on the main role of environmental technological advancement. Considering the drive for climate-neutral economy among the Nordic states, the current study examines the role of climate change technological development within the countries and technological spillovers across countries in the pursuit for green economy. By using a combination of pooled mean group approach of autoregressive distributed lag (for coefficient estimation) and the recently developed Granger non-causality approach by Juodis et al. (2021) for the panel dataset analysis over the period 1990–2018, the results reveal that both domestic technological development and spillovers from abroad promote long-run green productivity growth in the panel and country-specific estimations. In both estimations, the impact of international diffusion of climate change technologies on green productivity is found to be larger. Additionally, the influence of these two dynamics of climate change-related technologies on attaining greening economy is the most impactful in Sweden. In the remaining Nordic economies, climate change technology spillovers in Denmark are more impactful than in Finland and least in Norway, while climate change technological development in Norway drives green productivity more than in Finland and least in Denmark. As a robust insight, the Granger causality techniques revealed causality from climate change technologies within the countries, climate change technology spillovers, and population to green productivity. Consequently, public policies should promote green innovativeness and especially learning and knowledge transfer from other countries to achieve climate neutrality targets.

Unclaimed Dividends and Performance of the Fixed Income Market in Nigeria

This study investigated the effects of unclaimed dividends on the performance of the fixed income market in Nigeria from 1991 to 2021, with the specific objectives of determining the extent to which unclaimed dividends of less than 15 months, unclaimed dividends with registrars and unclaimed dividends with companies have affected market capitalization of the fixed income market in Nigeria. The study utilized 31 years annual time series data obtained from CBN and SEC statistical bulletins for 2021. Johansen co-integration, ECM estimation and granger causality techniques were used to ascertain the short and long run relationship among these variables. Results indicated that a long run relationship exist between unclaimed dividends and performance of the fixed income market, while the speed of adjustment in event of any distortion is about 62.5%. It was also revealed that only unclaimed dividends with companies have a positive effect on market capitalization of the fixed income market; while unclaimed dividends of less than 15 months, unclaimed dividends with registrars and unclaimed dividends with Companies have a joint significant effect of about 80% on market capitalization of the fixed income market. It was as such deduced that unclaimed dividends has a long run significant effect on the performance of the fixed income market in Nigeria. The study therefore suggested that there is need for sincerity on the part of the government, SEC and registered companies to reduce the volume of unclaimed dividends in Nigeria; as this will go a long way in boosting the performance of the Nigerian capital market.

Oil price movements and agricultural production from heterogeneous sub‐sectors: Analysing the Dutch disease in an African resource‐rich economy

AbstractThe economy of a developing country like Nigeria has evolved from a strong dependence on agricultural exports in the 1960s to an unhealthy reliance on crude oil exports. This has led to a large agricultural trade deficit that requires a better understanding of the dynamic relationship between oil price booms and agricultural production. To this end, the study not only isolates the effect of oil price movements on agricultural production from heterogeneous sub‐sectors in Nigeria but also tests for Dutch disease symptoms using annual data from 1970 to 2019. Employing the auto‐regressive distributed lag (ARDL) cointegration and dynamic simulations as well as dynamic Granger causality techniques, the study shows that in the long run, oil price booms affect the food sector and the livestock sector heterogeneously. An increase in the oil price undercuts the production performance of the food sector. Also, because of the strong linkage between domestic livestock production and the global livestock market, an increase in domestic production has a weak predictive content for oil price booms. The policy implications of these findings include the sterilization of oil revenues outside the country and collaboration with foreign investors to provide much‐needed investment in the agricultural sector through various incentive schemes.

Effect of Crude Oil Revenue on the Oil and Non-oil Sectors in Nigeria

Abstract The debate for oil-rich economies to plough their oil windfalls into real economic activities to spur diversification has become intense due to the deficit fiscal crisis and poor socio-economic profile of resource-abundant nations. Therefore, we use secondary data from the period between 1981 and 2020 to assess the impact of crude oil revenue on the oil and non-oil sector output performance in Nigeria. The study adopts the ARDL (i.e. autoregressive distributed lag) and the augmented Granger causality techniques to analyse the data. The ARDL regressions show that crude oil positively impacts oil sector performance, but the impact is only substantial in the short run. Crude oil revenue exerts a positive and insignificant effect on the short-run non-oil sector output, whereas, over the long run, it has a negative but significant effect. To propel growth, the study recommends using the excess crude oil earnings to develop non-oil sectors such as agriculture, services, and manufacturing.

Industrialization, globalization, ICT, and environmental degradation in Malaysia: A frequency domain analysis

This paper examines the causal relationship between industrialization, globalization, information communication technology (ICT) and environmental degradation in Malaysia during 1970–2019. It uses two indicators of environmental degradation (carbon emissions and ecological footprint), three dimensions of globalization (political, social, and economic) and three indicators of ICT (users of internet, mobile cellular, and fixed telephone subscriptions). It utilizes Granger causality technique in frequency domain which differentiates between permanent and temporary causality, Vector Error Correction approach as well as Variance Decompositions. The bound test shows that the variables have cointegration relationship. It reveals joint long-run and short-run causality from industrialization, globalization, and ICT to carbon emissions, albeit the causality to ecological footprint is tenuous. It indicates that industrialization, globalization, and ICT significantly predict carbon emissions at high frequency than at low frequency. A substantial percentage of the forecast error variance in environmental degradation are explained by industrialization, globalization, and ICT. The robustness of the empirical outcomes is confirmed by the alternative proxies of the variables. Our study implies that industrialization, globalization, and ICT are determinants of environmental degradation. Therefore, policies to mitigate environmental problem should prioritize these variables to attain green economy.

PENGARUH PARTISIPASI ANGKATAN KERJA (TPAK) DAN TINGKAT PENGANGGURAN TERBUKA (TPT) TERHADAP PDRB DI PROVINSI ACEH

The open unemployment rate (TPT) and the labor force participation rate (TPAK) were compared in Aceh Province for the purpose of this studyaffected the gross regional product (GDP). Secondary data from BPS and Plantation Statistics were used in this study. VAR is the data analysis technique employed in this study. The study's findings indicate that TPAK and TPT have no impact on GRDP and that, according to the GRDP's granger causality technique, there is no reciprocal association between TPAK and TPT (causality).

Effect of Manufacturing Sub-Sector Performance on Productivity in Nigeria

Kaldor’s theory of growth is one theory that advocates for the manufacturing sector as a channel of increasing productivity and increasing employment. However, many developing countries like Nigeria seem to be bypassing the dynamism of the manufacturing sector. This study looked at the role of manufacturing sector to the productivity of the economy for the period 1986 to 2018, bearing in mind that productivity growth reflects in the GDP (gross domestic product) of a country. The study applied the Autoregressive Distributed Lag model (ARDL) and the Granger Causality technique. The major finding of this study is that manufacturing export, manufacturing capacity utilization, credit to manufacturing, manufacturing output were positively related while manufacturing value added and unemployment were negatively related to labour productivity. Negative relationship that exists in manufacturing value added which shows that there is no actual value addition in this sector even when manufacturers output increases. MCU (Manufacturing capacity utilization) was seen to cause Labour productivity while Labour productivity in turn brought about increase in manufacturing output and manufacturing export. This implies that there is room for achieving more in this sector by increasing value addition and increasing manufacturers utilization capacity, which will support more output, export, job opportunities and growth in the economy. The study therefore suggests that the advantage in this sector be harnessed by increasing manufacturers’ value addition and capacity utilization, giving them what it takes to do so which will inadvertently boost the economy.

Sustainability, Natural Gas Consumption, and Environmental Pollution in the Period of Industry 4.0 in Turkey: MS-Granger Causality and Fourier Granger Causality Analysis

The effects of environmental pollution and Industry 4.0 on a sustainable environment are the main topic of this study, which may be regarded as a complement to the literature on energy and the environment. The paper aims to investigate the relation between Industry 4.0 (I4.0) and environmental sustainability, which is very important for policymakers, practitioners, and company executives in the period of Industry 4.0 in Turkey. To this end, natural gas consumption and technology patents as control variables of Industry 4.0, in addition to the variables of environmental pollution and economic growth, were selected during the period of 1988 to 2022 using Markov switching VAR (MS-VAR), Markov switching Granger causality (MS-GC), Fourier VAR (FVAR), and Granger causality (FGC) techniques. The reason for covering the period starting in 1988 is its recognition as the beginning of the Industry 4.0 era with AutoIDLab in 1988. According to the causality results, there was unidirectional causality running from technology patents to environmental pollution in the results of both MS-GC and FGC. However, the directions of causality between natural gas consumption and environmental pollution, and between economic growth and environmental pollution differed between regimes in the MS-GC model. Bidirectional causality was determined between economic growth and environmental pollution in the first MS-GC regime. However, in the second regime, unidirectional causality from economic growth to environmental pollution was determined. The causality direction determined by Fourier causality gave the same result with the second regime. A similar finding was observed in the direction of causality between natural gas consumption and CO2 emissions. While MS-GC determined unidirectional causality from natural gas consumption to environmental pollution in the first regime, a bidirectional causality result between GC and environmental pollution was determined in the second regime. The FGC result was similar to the second regime result. And lastly, the MS-GC and FGC methods determined unidirectional causality from Industry 4.0 to environmental pollution.

Does Twin Deficit Hypothesis Exist in India? A Structural Break Co-integration Analysis

The primary focus of this study is to examine the long-term and short-term impact of fiscal deficit (FD) on the current account deficit (CAD) in India over the period of 1980 to 2021 in the presence of inflation and exchange rate. For the estimation of data series, the study employed autoregressive distributed lag (ARDL) co-integration test and Gregory Hansen (GH) co-integration test with endogenous structural break. The empirical results from ARDL bounds tests fail to provide a long-run relationship for the variables. The threshold co-integration test (GH) estimation suggests a strong evidence of a co-integration relationship for the variables and the break year is found in 2005. Thus, the findings validate the twin deficit hypothesis in the long-run as the FD has a positive significant effect on a CAD in India. Similarly, the long-run estimates of inflation have a positive significant effect on the CAD. It implies that an increase in rate of inflation distorts the CAD in the long-run. Consequently, the government of India should control the price hike and make macroeconomic situations favourable for domestic tradable sectors. The results from the Granger causality technique show bidirectional causality between FD and CAD implies the twin deficit in India. Based on the empirical findings, it may be argued that the Central Bank of India should try to reduce the prolonged CADs and retain stability in the domestic currency.

The Impact of Tourism Receipts on Economic Development: A Panel Data Analysis for Selected Asian Countries

The current study aims at studying tourism which has emerged as one of the most dynamic rising international industries for economies. The present study inspects the influence of tourism receipts, trade openness, investment and population on the economic growth of selected Asian nations between 1995 and 2021. The data for the variable of interest has been taken from the Global Development Indicator (WDI). Checks for LLC and IPS have been conducted on stationary. Both the models, FMOLS and the Dynamic OLS, have been used to capture both short and long-run flexibility. For this objective, the Granger causality technique has been utilized. The results indicate that tourism receipts have a favorable and substantial effect on the economic growth of some Asian nations. The study also shows that the tourism sector has ample capacity to contribute to economic growth; therefore, tourist-attractive places should be provided with essential amenities such as connectivity and infrastructure.