Gross Domestic Product Growth Research Articles

Aggregate tone and gross domestic product

AbstractWe examine whether the change in earnings announcement textual tone, aggregated across individual publicly traded firms, helps predict gross domestic product (GDP) growth. The literature finds that changes in aggregate accounting earnings do help predict GDP growth, but only when aggregate earnings changes are negative. Because conservative accounting rules limit managers' ability to communicate positive news promptly, we examine the tone of quarterly corporate earnings announcements as a possible source of timely positive information provided by firms. We find that the change in aggregate tone in the earnings announcements from the same quarter in the previous year predicts one‐quarter‐ahead GDP growth, but only when the change is positive. Our study contributes to the literature by investigating the relation between aggregate corporate disclosure tone and macroeconomic outcomes.

The Impact of GDP Growth on Foreign Direct Investment: An Analytical Study

This study explores the relationship between Gross Domestic Product (GDP) growth and Foreign Direct Investment (FDI) inflows in developing economies. As FDI plays a pivotal role in driving economic progress, understanding its dynamics relative to GDP growth provides valuable insights for policymakers and investors. The manufacturing sector, with its need for cost efficiency, production scale, and infrastructure, attracts FDI when GDP growth fosters these elements. Conversely, the services sector, which relies on skilled labour and technology, benefits from rising GDP, fuelling local demand for services. This research uses historical data, descriptive statistics, and regression analyses to evaluate GDP's impact on FDI from 1970 to 2023. The findings reveal a positive correlation between GDP growth and FDI inflows, with distinct sectoral variations that highlight specific economic demands in manufacturing versus services. The study’s conclusions aim to guide targeted policies for fostering sectoral FDI, supporting balanced and sustainable economic development.

Islamic Finance and Environmental Sustainability: Empirical Insight from OIC Countries

Environmental degradation remains a significant global challenge, particularly in the Organization of Islamic Cooperation (OIC) countries. This study primarily examines the impact of Islamic finance, proxied by two indicators, namely Islamic financial assets and Islamic banking financing, and other variables including Gross Domestic Product (GDP), Foreign Direct Investment (FDI), urbanization, renewable energy adoption, and forest area, on CO2 emissions. This study revealed that Islamic financial assets had a negative impact on CO2 emissions, highlighting their importance in supporting green investments and sustainability. However, Islamic banking financing has little influence on emissions reduction, most likely due to carbon-intensive initiatives. Furthermore, GDP growth increases emissions, although FDI, urbanization, and forest areas help to lower them. These findings underscore Islamic finance's critical role in fostering sustainable development, as well as the necessity for better green Islamic financing policies in OIC member nations. The findings also provide important insights for policymakers working to balance economic growth with environmental sustainability in Islamic finance.

Foreign direct investment inflow and the economic growth nexus in Tanzania

PurposeA shortage of investment capital is one of the main issues facing most developing economies, including Tanzania. Policymakers, economists, and governments in these countries have been debating how to overcome this obstacle and improve economic growth through foreign direct investments (FDI). The present study endeavors to examine the relationship between FDI and economic growth in Tanzania during the period of 1991–2021. The analysis considers financial development, capital formation, and labor force involvement as intermediation variables.Design/methodology/approachThe study uses time series data to estimate an autoregressive distributed lag (ARDL) model, as well as Granger causality tests to investigate the relationship between the variables under study.FindingsThe findings show a long-run co-integration between the studied variables. However, only FDI and labor input have a significant impact on gross domestic product (GDP) growth in both the short and long run. Bidirectional causality exists between FDI, labor input, and GDP growth in the short and long run.Practical implicationsThis study contributes to an understanding of the relationship between inbound FDI, labor input, and economic growth in Tanzania, as well as updating the government to improve its financial system to gain more from FDI inflows and hence boost growth-enhancing effects.Originality/valueThis study provides insight into the relationship between inbound FDI and economic growth in Tanzania, which is a critical policy concern in developing economies. Extant studies’ results remain controversial, and this is the first study in Tanzania to investigate the FDI-growth nexus, by considering financial development, capital formation, and labor input simultaneously.

STUDY OF TRIPLE BOTTOM LINE FRAMEWORK TO DETERMINE THE OFDI PATTERN OF VIETNAM

This study investigates Vietnam’s Outward Foreign Direct Investment (OFDI) spanning from 1990 to 2022, utilizing the Triple Bottom Line (TBL) framework alongside the Fully Modified Ordinary Least Squares technique. The observed positive correlation between CO2 emissions and foreign investment underscores the importance of corporate sustainability. Vietnam’s extensive forested land, comprising 41.89% of its total area, emerges as a pivotal factor in attracting environmentally conscious investors. On the social front, the population size demonstrates a negative impact on OFDI due to heightened competition within the domestic labor market. Regarding economic variables, the Consumer Price Index and patent applications exhibit minimal effects, whereas a growing Gross Domestic Product (GDP) substantially boosts foreign investments. The proposed practical policies for promoting OFDI include reinforcing environmental regulations, incentivizing the adoption of eco-friendly technologies and prioritizing the conservation of forested areas.

Economic Indicators And Stock Market Performance: An Analysis Of GDP, Unemployment Rates, And Inflation

This research paper delves into the intricate relationship between three fundamental economic indicators—Gross Domestic Product (GDP), unemployment rates, and inflation—and their consequential effects on stock market performance. The primary objective of this study is to elucidate how variations in these indicators influence investor behavior and, subsequently, stock market trends. The research employs a dual methodological approach: quantitative analysis of historical economic and stock market data, and qualitative examination through case studies of notable economic events. This research looks back in history for a pattern and correlation of the stock market's moves in relation to changes in various economic indicators. For instance, it probes how changes in the GDP growth rate have their effect on investor confidence and, in turn, stock market valuation. It also looks at how fluctuations in the rate of unemployment lead to variations in market performance, as this generally indicates economic health and spending on the part of consumers. It also tends to focus on the relationship between inflation and return in the stock market, given influences on interest rates and corporate profits as a result of inflationary pressures. Besides data analysis, the study also makes use of case studies of vital periods in economies, such as the financial crisis of 2008 and the COVID-19 pandemic, to develop context and enrich the understanding of how these indicators interact within an extreme economic scenario. Such case studies bring understanding into the way investor sentiment and stock market performance respond to changes in GDP, unemployment, and inflation in real-world scenarios. These findings from this research indicate complex interdependencies between the series of economic indicators and stock market performance. For example, strong GDP growth is perceived in general to be associated with favorable stock market performance, whereas high inflation and increasing unemployment may soften or even exert negative effects. The study also emphasizes the role of investor sentiment and market psychology in amplifying or dampening the impacts of these economic indicators. In sum, this paper contributes to an integrated understanding of how GDP, unemployment rate, and inflation interact in shaping dynamics in the performance of the stock market. It thus provides an avenue through which both investors and policymakers, and economists who want to navigate or predict market movements in light of economic trends, draw useful guidance. The underlined idea herein is that instead of looking at separate economic parameters, it will be more relevant for any research work if several factors are considered together for better analytical reasoning on stock market performance.

Inflation forecasting in turbulent times

AbstractIn the recent years many countries were hit by a series of macroeconomic shocks, most notably as a consequence of the COVID-19 pandemic and Russia’s invasion in Ukraine, raising inflation rates to multi-decade highs and suspending well-documented macroeconomic relationships. To capture these tail events, we propose a mixed-frequency Bayesian vector autoregressive (BVAR) model with Student t-distributed innovations or with stochastic volatility. Whereas inflation, industrial production, as well as oil and gas prices are available at monthly frequencies, real gross domestic product (GDP) is observed at a quarterly frequency. Thus, we apply a mixed-frequency setup using the forward-filtering–backward-sampling algorithm to generate monthly real GDP growth rates. We forecast inflation in those euro area countries that extensively import energy from Russia and therefore have been heavily exposed to the recent oil and gas price shocks. To measure the forecast performance of the mixed-frequency BVAR model, we compare our inflation forecasts with those generated by a battery of competing inflation forecasting models. The proposed BVAR models dominate the competition for all countries in terms of the log predictive density score.

RELATIONSHIP BETWEEN LOGISTICS SECTOR AND ECONOMIC GROWTH IN ASEAN COUNTRIES

In the modern economics, any manufacturing companies have increasingly relied on professional logistics firms, leading to rapid growth in the logistics sector as a service industry and its significant contribution to economic development. With increasing globalization and competition, countries have focused on enhancing their logistics systems to ensure stable economic growth and strengthen global trade competitiveness. In the ASEAN region, logistics plays a critical role, facilitating cross-border trade and regional connectivity. This study aims to investigate the relationship between the logistics sector, specifically air freight transportation, and economic growth in ASEAN countries, given the sector's central role in supporting supply chain management and trade activities. The primary objective of this study is to determine whether there is a causal relationship between air freight transportation (AFT), a key logistics activity, and gross domestic product (GDP) growth in six ASEAN countries. The study seeks to provide insights into how investment in logistics infrastructure, particularly in air freight, may influence economic growth in the region. The study uses panel data for six ASEAN countries from 1996 to 2021. Data on GDP growth and air freight transportation were sourced from the World Bank’s World Development Indicators database. A series of statistical tests, including the Cross-Sectional Augmented Dickey Fuller (CADF) test, Pesaran’s slope homogeneity test, and the Bootstrap Granger causality test, were performed to examine cross-sectional dependence and the causal relationship between GDP growth and air freight transportation. Descriptive statistics revealed significant disparities in air freight transportation capacity among the countries studied, with Indonesia and Thailand showing substantial air freight volumes compared to the Philippines. However, the results of the panel causality tests, including the Dumitrescu and Hurlin panel causality test, indicate that no causal relationship exists between air freight transportation and GDP growth in the six ASEAN countries.

Empowering a Knowledge-Based Economy: An Assessment of the Influence on Economic Development

Scientific research is one of the most important variables affecting the economic growth and development of a country, being the engine of innovation. In this regard, the relevance of various assessments of scientific interaction with economic development is determined by modern requirements. The study aims to investigate the impact of scientific research on economic development in Albania. The assessment was based on the analysis of secondary data from organisations such as Eurostat and INSTAT, which were further considered within the framework of an econometric model in EViews. The study highlighted the role of stimulating economic development in Albania in various sectors. The study demonstrated that scientific research is highly significant for the economic growth of a country. Based on the statistical data during the period from 1996 to 2022, a regression model was employed to simulate the relationship between independent variables (scientific labour force, public research and development (R&D) expenditures, and patents) and the dependent variable (gross domestic product (GDP) growth). The study shows that these factors have a positive impact on the gross domestic product per capita in Albania. The empirical research results revealed that the scientific labour force, public R&D expenditures and patents have a positive and significant impact on GDP growth in Albania. Based on the information received, recommendations were made to improve the quality of scientific research in the country. The result of this study could provide valuable information to policymakers and serve as scientific evidence for future studies.

Pengaruh Nilai Tukar, Inflasi, Produk Domestik Bruto terhadap Ekspor Karet Indonesia Periode 2015 sampai dengan 2022

This study aims to analyze the influence of exchange rate, inflation rate, and Gross Domestic Product (GDP) growth on Indonesian rubber exports during the period of 2015-2022. The objective of this research is to understand the dynamics of economic factors affecting Indonesian rubber exports and their potential contribution to the national economy. A quantitative research method was employed, utilizing regression analysis to test hypotheses regarding the relationship between the aforementioned variables. Data were obtained from official sources such as Bank Indonesia and the Indonesian Central Statistics Agency (BPS), encompassing exchange rates, inflation rates, GDP, and rubber export data. The analysis indicates that the exchange rate does not significantly influence Indonesian rubber exports. However, the inflation rate exhibits a significant positive impact on rubber export volume, while GDP growth shows a positive but insignificant influence. Simultaneously, exchange rates, inflation rates, and GDP collectively demonstrate a significant impact on rubber exports. This study underscores the importance of considering the economic factors examined in designing policies and strategies to enhance rubber exports in Indonesia. With a deeper understanding of these factors, it is hoped that better guidance can be provided for economic development in the rubber sector and, consequently, for the national economy.

Global Economic Policy Uncertainty and Global Economic Leaders’ Influence on Regional Economic Growth

This study aims to evaluate the regional economic growth of select American, European, and Asian countries amidst global economic uncertainty. The proposed methodology incorporates mixed frequencies in the data (VAR-MIDAS), facilitating the assessment of their reliance on lagged values, the impact of economic growth in other countries within the same region, and the influence of Global Economic Policy Uncertainty (GEPU). This sheds light on the effects of economic news from relevant newspapers on GDP growth. The primary hypothesis suggests a significant influence of other countries within the same region and the two major global economic powers on the Gross Domestic Product (GDP) growth of each studied region, namely the United States and China. This research also examines this hypothesis across 19 GEPU-included economies, categorizing them regionally by continent. The econometric results confirm the influence of the two leading economies on economic growth and identify causal relationships, with GEPU also exhibiting effects on GDP. Additionally, in-sample estimations reveal disparities in the influence of leaders on the economic growth of the examined economies.

Quantifying future carbon emissions uncertainties under stochastic modeling and Monte Carlo simulation: Insights for environmental policy consideration for the Belt and Road Initiative Region

This study critically examines future carbon (CO2) emissions in the Belt & Road Initiative (BRI) region, considering factors such as energy consumption, economic growth, population growth, and population density. The objective of this study is to identify critical areas of higher emissions, which require policy intervention capable of strengthening sustainability in the BRI compact. A combined approach of stochastic modeling and Monte Carlo simulations was employed, utilizing panel data from 45 countries in the BRI region from 1990 to 2021. Results confirm that emissions are higher in all scenarios in direct proportion to electric power consumption, population growth, and Gross Domestic Product (GDP) growth. In scenarios with high emissions, a continuous and significant upward trend in CO2 emissions was observe. The medium emissions scenario exhibited a more moderated rise in emissions, suggesting a balance between economic development and environmental considerations. Critical areas for future environmental policy-making resides in electric power consumption, population growth, and GDP growth. The study strongly recommends for a shift from the current focus on road and railway infrastructure to renewable energy infrastructure, green innovations and efficient technology transfer to member countries. Without this, the BRI region is likely to face increased emissions, posing significant challenges to future sustainable development and global environmental sustainability.

Impacto macroeconómico de la dolarización en el Ecuador durante el período 2006-2023

The macroeconomic impact is crucial for determining the well-being of a country. Analyzing variables such as Gross Domestic Product (GDP), inflation, unemployment, investment, and foreign trade allows for an assessment of a nation's economic health and financial stability. This article aims to analyze the impact of dollarization in Ecuador between 2006 and 2023. Adopted in 2000 to stabilize the economy and attract foreign investment; dollarization presented monetary and fiscal policy challenges. Authors like Cachanosky and Alvarado highlight the challenges in fiscal control and the relationship between exports and external income. The study employs a quantitative methodology, with regression analysis and time series based on data from the Central Bank of Ecuador. The results show moderate GDP growth and gross investment, as well as fluctuations in liquidity and credit to the private sector, along with persistent inequality in income distribution. The conclusions indicate that while dollarization has contributed to stability, it has limited the country's monetary autonomy. Additionally, dependence on external factors, such as U.S. monetary policy, has affected Ecuador's economic stability. The importance of diversifying the economy, promoting policies that foster sustainable and equitable growth, and reducing vulnerability to external fluctuations is emphasized.

Growth of Horticultural Export Market: The implication of Post-harvest Handling Practices among Small Scale Farmers in South Rift, Kenya

The inclusion of rural smallholder farmers in the export of horticultural products has two major implications: increased household income through access to a promising global market and enhanced productivity, cumulatively contributing to the growth of Gross Domestic Product (GDP) and foreign exchange. Currently, there are an estimated 2,500 smallholder farmers participating in horticultural exports South Rift of Kenya. Consequently, this study aimed to investigate the relationship between post-harvest handling practices by smallholder farmers and the growth of the horticultural export market. Quantitative data were collected using a structured questionnaire from a sample of 334 small-scale horticultural farmers, randomly selected for the study. Validity and reliability tests were conducted prior to the main study. Descriptive statistics and simple linear regression were employed to analyze the data. Post-harvest handling practices were assessed through the utilization of packaging materials, storage facilities, energy supply, hygiene, and transportation facilities. The findings indicated a statistically significant relationship between post-harvest handling practices and the growth of horticultural export markets. However, deficiencies were observed among small-scale farmers in South Rift, Kenya, in managing horticultural products after harvest. The study recommended for strategic interventions for the adoption of modern technologies in every stage of the supply chain and establishes collaborations with key stakeholders in order to minimize cost of investment per farmer and ultimately enhancing market standards compliance and competitiveness in the fruit and vegetable export market. Keywords: Post harvest, storage, packaging, Hygiene, Export, Markets

Exploring the Influence of Export Environment on Market Standard Dimensions and Horticultural Market Growth in South Rift, Kenya

The inclusion of rural smallholder farmers in the export of horticultural products has two major implications: increased household income through a promising global market, which is a catalyst for productivity, cumulatively growing Gross Domestic Product (GDP) and foreign exchange. So far, there are an estimated 2500 smallholder farmers who participate in the export of horticulture in Kenya. As a result, the current study sought to establish the influence of export environment on the relationship between market standard dimensions and export market growth of the horticultural products from small scale farmers in south rift of Kenya. The study collected quantitative data using a structured questionnaire from a sample of 334 small-scale horticultural farmers who were randomly selected. Validity and reliability tests were performed before the main study. Then, descriptive and multiple regression was used to analyze the data. Export environment was measured through: government support and services for export, government regulations and certifications and trade agreements and market access. Findings indicated that there was a statistically significant influence relationship between market standard dimensions and the growth of horticultural export market, where export environment on each predictor variable had the highest influence on market dynamics, followed by quality control, traceability and post-harvest handling practices being the least. This implies that the export environment plays a critical role in making the smallholder farmers’ products more competitive in export market. The study concluded that, appropriate policies, regulations and trade agreements were critical in market standards compliance. The government should create a framework to effectively disseminate information on trade agreements so as to benefit farmers and in addition establish collaboration between farmers, the government and private sector in export intervention measures. Keywords: Export, Horticulture, quality, Post-harvest, Traceability, Market

Dampak Industri Halal pada Perekonomian di Indonesia: Pengaruh Pendapatan, Ekspor, dan FDI terhadap PDB Melalui Pendekatan GMM

This research explores the influence of income, exports and foreign direct investment (FDI) on Gross Domestic Product (GDP) in the halal industry in Indonesia, using the Generalized Method of Moments (GMM) approach. This study is based on panel data from companies operating in the halal sector between 2010 and 2022. The results show that income and exports positively and significantly influence GDP growth, confirming the importance of company activities and export performance in driving national economic growth. In contrast, FDI was found to have no significant effect on GDP, indicating that foreign investment's contribution in this sector is not yet optimal or is influenced by other factors such as the quality of institutions and infrastructure. This research provides important implications for policymakers and stakeholders, considering the urgency of improving export strategies, diversifying markets, and improving the quality of institutions and infrastructure to maximize the economic benefits of FDI. In addition, the results of this research also emphasize the important role of the halal industry as a major contributor to Indonesia's economic growth, as well as the need for policies that support further development and diversification of the halal industrial sector.

How Do Net Exports and Remittances Impact on Economic Growth in Bangladesh? Insight from ARDL Time Series Model

This study delves into the intricate contribution of net exports and remittances on economic growth of Bangladesh with a focus of their impact on Gross Domestic Product (GDP). Net exports along with remittances are considered as key independent variables influencing the economic landscape of the country. The long-run and short-run effects of net exports and remittances on GDP are analyzed by conducting the Autoregressive Distributed Lag (ARDL) model over time period 1980-1922. The results of this study show that there is a positive effect of net export, remittance and gross capital formation on economic growth. On the other hand, all these independent variables have negative impact in short run and will adjust in long run significantly. As Bangladesh is a large remittance receiving country, export also increases in large volume by gross capital formation which increases domestic investment and output. The effects of remittances on GDP growth and exports on economic growth have each been the subject of much research, but independently. Buckling the payoff of exports and remittances on economic growth has not been studied. To fill this inane, we have tried to show how remittances and exports together boost economic growth. The findings contribute to a deeper understanding of the mechanisms through which net exports and remittance inflows shape economic outcomes in Bangladesh, offering insightful information to stakeholders and policymakers who are active in promoting sustainable economic development.

Financing health in sub-Saharan Africa 1990-2050: Donor dependence and expected domestic health spending.

In 2021, global life expectancy at birth was 74 years whereas in sub-Saharan Africa it was 66 years. Yet in that same year, $92 per person was spent on health in sub- Saharan Africa, which is roughly one fifth of what the next lowest geographic region-North Africa and Middle East-spent ($379). The challenges to healthy lives in sub-Saharan Africa are many while health spending remains low. This study uses gross domestic product, government, and health spending data to give a more complete picture of the patterns of future health spending in sub-Saharan Africa. We analyzed trends in growth in gross domestic product, government health spending, development assistance for health and the prioritization of health in national spending to compare countries within sub-Saharan Africa and globally.We found that while gross domestic product was projected to increase through 2050 in sub-Saharan Africa, the share of gross domestic product that goes to health spending is only expected to increase moderately. Our exploration shows that this tepid growth is expected because the percent of overall government spending that is dedicated to health 7·2% (6·3-8·3) compared to average of 12·4% (11·7-13·2) in other regions) is expected to stay low. Even if the amount, of resources provided from donors climbs some, it is not expected to keep pace with growing economies in sub-Saharan Africa and may transition towards other global public health goods. Critically, development assistance for health provided to sub-Saharan Africa is expected to decrease in some countries, and the expected growth in government health spending might not be enough to cover this expected decline. Increases in spending with a concordant prioritization of health and the appropriate health system governance and structural reforms are critical to ensure that people who live in sub-Saharan Africa are not left behind.

Environmental sensitivity of the Caribbean economic growth rate

Abstract. The year-over-year changes in economic growth across the Caribbean Antilles islands demonstrate sensitivity to climatic conditions. Daily wind and rainfall exceedances from passing storms are negatively related to the gross domestic product (GDP). Field regression of the GDP time series from 1971 to 2022 for Puerto Rico and the neighboring Antilles islands reveals links with eastern Pacific sea temperature. A zonal overturning atmospheric circulation over the equatorial Atlantic emerges in composite analysis. Alternating at an approximate 7-year interval, it modulates weather events and economic prosperity in the Caribbean. A multivariate algorithm is developed to predict changes in the annual GDP growth rate. The most influential predictor is precipitable water in the equatorial Atlantic 1 year earlier. Reduced moisture overlain by westerly winds in a global bottleneck at 5° S–5° N, 20–40° W tends to suppress Caribbean storms, leading to economic prosperity in the following year. Statistical methods and risk-reduction strategies are outlined.

Bank intermediation efficiency and liquidity risk in Egypt: a two-stage non-parametric analyses

This is a pioneering study that undertakes a comparative analysis assessing the annual intermediation efficiency of public versus private banks in Egypt. Moreover, liquidity risk is a major threat facing banks in their efforts to sustain financial stability. Thus, this study is the first to model the determinants of liquidity risk in public and private banks in Egypt while examining the impact of banks’ intermediation efficiencies on their liquidity risk levels. The study employs advanced nonparametric econometric approaches on a sample of Egyptian public and private banks from 2014 to 2022. The data envelopment analysis is used in estimating banks’ intermediation efficiency scores, while the quantile regression analysis is applied to examine the impact of bank intermediation efficiency on liquidity risk under different liquidity risk quantiles. The findings indicate that public banks show consistent superiority in terms of their financial intermediation efficiency levels compared to private banks. Moreover, the paper findings demonstrate the negative significant relationship between bank intermediation efficiency and liquidity risk while highlighting the higher significant positive impact of intermediation efficiency on reducing the liquidity risk of banks that are characterized by undertaking high liquidity risk levels. Furthermore, contrary to general assumptions, this study’s findings demonstrate that the significance of micro- and macro-level determinants of a bank’s liquidity risk is dependent on its prevailing liquidity risk level. Hence, the positive impact of equity capital, asset concentration, size, and growth in gross domestic product and the negative effect of asset quality on bank liquidity risk vary under banks’ different liquidity risk quantiles.