Domestic Consumption Growth Research Articles

Economic Justification of an Investment Project in Vegetable Growing Based on a Comprehensive Sensitivity Analysis

Introduction. The practice of investment design in the agricultural sector indicates the need for comprehensive consideration of various types of uncertainty in the process of evaluating the effectiveness of financial investments in investment projects using various tools and methods, which is of particular importance for protected soil vegetable growing, as one of the most capital-intensive industries. The domestic greenhouse business is an attractive area of direct investment, since its development is the main factor in the growth of domestic consumption and import substitution of vegetable products. In this article, the economic justification of the investment project for the organization of greenhouse vegetable growing is carried out on the basis of a comprehensive sensitivity analysis used to assess risks. Methodology. In the process of assessing the economic efficiency and investment attractiveness of the project, one-factor and two-factor analysis of the variation of parameters, as well as the method of critical points were used. Results. Using the example of a real investment project, the influence of a large number of different variations of key parameters on the resulting project performance indicators was analyzed, which made it possible to determine their marginal (critical) values. The results obtained make it possible to prevent potential problems and adjust indicators in the process of project implementation under conditions of uncertainty. Conclusions. Sensitivity analysis of an investment project is an important component of the economic justification of an investment project, which enables to predict risks and make decisions for its successful implementation.

Development of chinese-brazilian agri-food trade

The article analyzes the Chinese-Brazilian trade in agri-food products. The importance and complementarity of bilateral trade flows are revealed; Brazil's growing inter- and intra-industry specialization in the supply of agricultural raw materials while maintaining a negative balance for the Chinese side. There was a significant lag between the net exporter and the importer in terms of the global food security index and the presence of a higher prevalence of malnutrition among the population. The decline in the already low share of agri-food products in total exports from China to Brazil is determined by the growth of domestic consumption of a variety of food products of domestic production and China's international specialization in the field of non-agricultural products with medium and high levels of added value. The main changes in tariff and non-tariff measures for regulating mutual trade have been identified. Emphasis is placed on the relationship between investment and trade policy of China, whose companies invest in the agro-industrial complex and infrastructure of Brazil in various forms, including international business mergers and acquisitions, construction from scratch, creation of joint ventures. The factors, risks and prospects of further development of the Sino-Brazilian agricultural trade are identified, taking into account the geopolitical effects of the possible substitution of large-scale purchases of soybeans from the United States with Brazilian supplies to China.

The dragon Down Under: the regional labour market impact of growth in Chinese imports to Australia

ABSTRACT Manufactured imports from China to Australia grew 11-fold between 1991 and 2006. Local differences in industry structure are used to identify the impact of that growth on local labour market outcomes. This growth is estimated to have reduced local manufacturing employment considerably. Local adjustment occurred through labour mobility between regions plus increased rates of unemployment and non-participation. By contrast, import growth from other Asian countries had little impact on Australian manufacturing employment. This is because Chinese imports tended to be in sectors with slower growth in domestic consumption (absorption) and with high labour intensity.

Digital platforms as a factor in strengthening national food security

Ensuring food security is one of the key areas in the management of economic security. Today, Russia's food security is sufficiently strengthened. However, a reasonable question arises about the promising directions of its development. The article explores the possibility of using digital platforms to improve the efficiency of national food security management. It is established that currently many countries of the world are betting on increasing the level of self-sufficiency in food as a fundamental condition for ensuring national food security. At the same time, the importance of criteria such as food quality and compliance of the domestic food market with the requirements of healthy nutrition is rapidly increasing. Using the example of the dairy market, it is shown that the Russian food market is quite stable and is characterized by the predominance of domestic production over imports in resources. There is an increase in exports. At the same time, there are no signs of active import substitution, the growth of domestic consumption lags behind the growth of production. To solve the current problems of food security, it is proposed to implement digital platforms in the agro-industrial complex at the stages of production of agricultural raw materials, its processing, consumption control and implementation of social policy to support the nutrition of socially vulnerable segments of the population. The use of digital platforms is aimed at improving the efficiency of national food security management.

ФАКТОРИ ІННОВАЦІЙНОГО РОЗВИТКУ ТА ПІДВИЩЕННЯ РІВНЯ КОНКУРЕНТОСПРОМОЖНОСТІ ПРОВІДНИХ ТНК – ВИРОБНИКІВ СТАЛІ

The factors of supply and demand formation in the world steel market were determined, taking into account the principles of the system approach. The author singled out traditional economic factors that shape supply and demand on world markets, as well as factors of technical development of production that affect the volume of deliveries of certain types of products. The analysis showed that steel production is one of the fastest-growing areas of world industry, making a significant contribution to the growth of the gross domestic product in various regions of the world. Preference is given to the strongest materials with innovative properties and a low price. Steel-based materials are more adapted to these conditions, which is confirmed by the growth of their global production. The study also revealed the causes of price instability on the global steel market. At the same time, it was determined that steel prices are due primarily to the growth of its global consumption in the dynamics of the last 10 years, which is connected with the construction boom in Southeast Asia and the development of industry in other countries. It has been proven that in recent years there has been volatility in the rate of growth of the structure of steel exports, which in general made it possible to form factors that influenced the intensity of changes taking place in the steel market. Among them, the author singles out: needs for nanostructured materials, integration of modern digital technologies of neural networks and automation systems in production. An important factor in the competitiveness of steel on the world market is the expansion and introduction of new financial instruments that increase the degree of independence of the metallurgical industry from price fluctuations and other external influences, including new banking and insurance products with state participation. Such a policy will allow attracting foreign investments to the industry, which will significantly strengthen the position of Russian manufacturers on the international market. Factors of competitiveness of steel in the world market were systematized. In particular, among them, the author focused on the growth of domestic consumption of metals in the form of general development and support for the growth of all industries in the country.

Steel industry of China in 2020 and the world crisis

The crisis of the world economic system, erupted in the end of 2019 against the background of COVID-19 expansion resulted in considerable drop of the world steel products production practically in all the countries of the world. Decrease of steel production began in the IIH of 2019, mainly in July-August of 2019 and further in March-April of 2020. In the IQ of 2020, the world steel production declined by 1.4% down to 443 million tons comparing with the analogue period of 2019. At that China demonstrated growth by 1.2%, while in the EC counties the decrease accounted for 10%, in North America counties – by 4%, in South America countries – 7.1%, other countries of Asia, Africa and CIS also demonstrated the decrease. The dynamics of prices variation on some steel products, iron ore presented, which give the idea of the market state and tendencies of its variation in 2019–2020. In China in April of 2020 after cancellation of quarantine measures, a restoration of the industry began, the economy of China transferred from decline to growth and an active growth of domestic consumption of steel products got a significant effect not only on the volume of its production, but also made corrections in China’s behavior at the world market. As a result of year 2020, steel production in China exceeded one billion tons – 1054.4 million tons, which is 5.2% more comparing with 2019. Production of finished products increased also, import of iron ore into China in 2020 accounted for 1172 billion tons, which is 9.5% more comparing with 2019. As a result of 2020, the steel companies of China exported 53.7 million tons of steel, which is 16.5% lower than the 2019 index. Further the Chinese export will be contributed by an increase of demand at the world market and cancellation of restriction measures, imposed by some countries. While at all the regions of the world the crisis resulted in termination of some projects or their delays, in China against the background of the pandemic, several companies did nor cancel their investment plans as well as construction and commissioning of new plants was going on. Under conditions of the crisis the support of the state was very important, since the demand declined in all the industries, therefore many countries took urgent measures for stabilization of economies and support of population. Within the period of the pandemic, the China government bodies elaborated some measures to overcome its negative effect on the economy. In particular, the measures include allocation of money to stimulate the domestic consumption of steel products. In total in 2020 it was planned to invest about 800 billion of yuan (about USD 115 billion) in capital assets. According to forecasts, in 2021 comparing with 2020, the production and apparent consumption of steel in China will increase approximately by 2%, actual demand will increase by higher rate. The steel products with high added value will be in higher demand, including flat rolled products, rolled products of special steels, seamless pipes etc.

The dragon down under: The regional labour market impact of growth in Chinese imports to Australia

Imports of manufactured goods from China to Australia grew more than eleven-fold in real US dollar terms between 1991 and 2006. This study uses differences in industry structure between regions to identify the impact of that growth on labour market outcomes in Australia. Overall, the growth in Chinese imports is estimated to have reduced the ratio of manufacturing employment to population by 1.6 percentage points, and manufacturing employment by 221,000 workers. Adjustment to this impact on local manufacturing employment appears to have occurred through labour mobility between regions, but also increased rates of unemployment and non-participation. Growth in manufacturing imports from other Asian countries during this period, by contrast, is found to have had little impact on manufacturing employment in Australia – with the main explanation for the difference being that Chinese imports were weighted more to manufacturing sectors experiencing slower growth in domestic consumption (absorption) and with high labour-intensity. The study concludes by interpreting the estimated impacts of Chinese imports on Australia against estimates for other countries.

ОЦЕНКА ЭФФЕКТИВНОСТИ РЕАЛИЗАЦИИ АГРОПРОДОВОЛЬСТВЕННОЙ ПРОДУКЦИИ НА ВНУТРЕННЕМ И ВНЕШНЕМ РЫНКАХ: СЪЕДИМ ИЛИ ПРОДАДИМ?

The article examines the impact of export-­oriented growth on the development of agriculture and food security in the country, outlines the methodological issues of assessing the comparative effectiveness of the sale of certain types of food in the domestic market and for export, substantiates the need for mutual coordination of state regulation of the domestic market and exports. With a higher efficiency in the sale of products in the domestic market in comparison with exports, it is advisable to stimulate the growth of domestic consumption and refuse to support exports, since this violates the interests of domestic consumers.

Actual Problems of Sustainable Development and their Solution in Russia

In the post-industrial period, which began in developed countries in the 1970s–1980s, the processes of globalization and competition in world markets came to the fore. As a result of the intensive development of industry and the growth of domestic consumption, many countries have largely exhausted the economic capacity of their territories. They are experiencing a shortage of raw materials. Over the past sixty years, the world’s leading countries have been implementing a socio-ecological and economic model of social development, which allows them to use financial, labour and natural resources rationally. Russia’s transition to sustainable development can give an additional impetus to the country’s socio-economic development. It also ensures breakthrough scientific and technological progress, increases the competitiveness of the national economy, creates other opportunities for more effective implementation of strategic planning documents and national projects.

Precautionary risks for an open economy

Our empirical investigation reveals that the variance of foreign consumption is much higher than the variance of domestic consumption growth for the domestic United States of America (US) resident. We show that precautionary savings in foreign currency arise because of this volatility differential between domestic and imported consumption growth. These open economy stochastic discount factors are later shown to be strongly positively correlated with the US business cycle. We present evidence that the precautionary currency risk must be seen through the lens of an open economy model rather than the traditional durable/non-durable closed economy separation.

Industry bubbles and the cross‐sectional variation of expected consumption growth

AbstractWe study the relationship between the domestic consumption growth and industry bubbles, under the assumption that, at a global level, the bubbles created by productive countries totally or partially offset the bubbles created by unproductive countries. Using a methodology based on a time‐varying parameter vector autoregression, we define the expected consumption growth as a function of the exposure to bubbly episodes and the price of bubbles, among other variables. We test the model for nine European countries. Our results show that the variation of construction and technology bubbles has a strong explanatory power for the domestic consumption growth.

Dinâmica produtiva da pecuária na mesorregião oeste catarinense: especialização e diversificação da produção no período de 2000 a 2017

O processo de colonização da região Oeste catarinense, iniciado nas primeiras décadas do século XX, por meio da instalação de pequenos produtores mercantis, artesões, comerciantes, entre outros, promoveu, a partir da década de 1960, a emersão de diferentes agronegócios (carnes, leite, madeira, extrativismo, grãos). Esses agronegócios sofreram um intenso processo de reestruturação técnico-econômica, pós-anos de 1990, o que resultou em alterações geoeconômicas a jusante e a montante das atividades produtivas. Somente no que se refere à produção pecuária, em 2017, a mesorregião Oeste catarinense foi responsável por 51% da produção estadual de bovinos, 78% da produção catarinense de frangos, 79% da produção estadual de suínos e 75% da produção estadual de leite. Assim sendo, o objetivo do artigo é expor o desempenho produtivo dos agronegócios ligados à pecuária do Oeste catarinense entre os anos 2000-2017. Percebe-se ter havido um crescimento da produção dos principais agronegócios da pecuária, alinhado à concentração da produção e à diversificação dos produtos derivados, impulsionados pelo crescimento das exportações e do consumo interno.

Valuation effects and risk sharing during the era of financial globalization

This article empirically studies the macroeconomic impact of valuation effects for a sample of 53 countries over 1980–2010. For high-income countries, the paper finds that valuation effects operate as a consumption risk-sharing channel. For emerging market economies (EMEs), the results depend on how valuation effects correlate with domestic consumption growth. Valuation effects act as a risk-sharing channel only if the correlation is negative, and are destabilizing otherwise. Consequently, the degree of risk sharing has improved in the former type of EMEs and worsened in the latter. Differences in the international portfolio composition between the two EME-groups explain this disparate experience.

Political enablers of energy subsidy reform in Middle Eastern oil exporters

Oil-exporting states in the Middle East and North Africa have launched reforms of long-standing energy subsidies thought to comprise an important source of legitimacy for autocratic regimes. The actions challenge enduring academic assumptions of the illegitimacy of retrenchment in polities underwritten by hydrocarbon rents. Here, I argue that a series of converging trends provided political cover for the reforms, including fiscal stress from low world oil prices, escalating regional instability, international environmental pressure, as well as untenable growth in domestic consumption of exportable commodities. While the reforms signal an important shift in state–society relations, the new policies appear to be designed to update — rather than jettison — rent-based autocratic governance.

An institutional approach and input\u2013output analysis for explaining the transformation of the Turkish economy

The increasing inconsistency in the Turkish economy gave rise to transformations necessitated by the manner of its growth and technological changes. Between 1923 and 1962, the Turkish economy was based on agricultural growth strategies, which spurred development in the manufacturing sector and caused technological change. Between 1962 and 1985, the Turkish economy developed under import substitution industrialization, with regulations based on domestic consumption growth strategies. In the early 1980s, most of the developed countries, in parallel with which Turkey had development policies, implemented strong institutional changes via deregulation policies, but Turkey could not produce the necessary configurations in accord with open and export growth economies. The period between 1985 and 2003 was a long transformational period for Turkey vying to be a stable export growth country. This slow transformation was caused by path dependency and had been based on regulations that destabilized Turkey and deepened problems remaining from previous periods. Post-2003, the Turkish economy was able to develop more consistent export growth by forced institutional changes, but its macroeconomic factors still do not show institutional complementarity.

Strengthening international competitiveness and investment growth as the basis for a new model of Serbian economy development

Insuffcient export activity and low level of investment in the formation of gross domestic product are a negative feature of the Serbian economy over a longer period of time. The global fnancial and economic crisis has shown that a sustainable model of economic growth, which was basically based on the growth of domestic consumption and imports and a low share of investments in the structure of the use of GDP, is an unsustainable until then. It has become clear that such a model must be replaced by a pro-investment and export-oriented model of economic growth. Bearing in mind the trends in macroeconomic flows in the Serbian economy, it is clear that the increase in investment and the competitiveness of domestic production imposes itself as one of the most important tasks of economic policy in the future. In this sense, the main goal of this.

Challenges of constructing salt cavern gas storage in China

After more than ten years of research and engineering practice in salt cavern gas storage, the engineering technology of geology, drilling, leaching, completion, operation and monitoring system has been established. With the rapid growth of domestic consumption of natural gas, the requirement of underground gas storage is increasing. Because high-quality rock salt resources about 1000m depth are relatively scarce, the salt cavern gas storages will be built in deep rock salt. According to the current domestic conventional construction technical scheme, construction in deep salt formations will face many problems such as circulating pressure increasing, tubing blockage, deformation failure, higher completion risk and so on, caused by depth and the complex geological conditions. Considering these difficulties, the differences between current technical scheme and the construction scheme of twin well and big hole are analyzed, and the results show that the technical scheme of twin well and big hole have obvious advantages in reducing the circulating pressure loss, tubing blockage and failure risk, and they can be the alternative schemes to solve the technical difficulties of constructing salt cavern gas storages in the deep rock salt.

How Chinese executives view economic challenges and global opportunities

PurposeTo better understand the challenges and opportunities facing China, the IBM Institute for Business Value in cooperation with Oxford Economics surveyed 1,150 executives from across China. Survey respondents represented a variety of industries and included executives from Chinese corporations, start-up enterprises, the government sector and educational institutions.Design/methodology/approachThis report shares the executives’ vision for the Chinese economy, and proposes actions to help spark growth and positive change.FindingsThe Chinese executives surveyed see the current economic environment in China as encompassing five main challenges – immature services sector, declining domestic consumption growth, lending decisions creating over investment in some sectors, declining export growth and environmental issues impacting economic development.Practical implicationsThe article identifies the six most important ways to accelerate China’s growth according to the executives:Originality/valueDespite challenges, Chinese executives are optimistic about the country’s economic growth prospects. In fact, 93 percent of executives believe China will maintain stable to high growth of more than 5 percent over the next five years. And almost a quarter of them believe China will be able to return to its recent very high growth rates in excess of 8 percent.

Assessment of chemical quality of Brazilian sugar cane spirits and cachaças

This study aimed to determine the chemical composition of Brazilian sugar cane spirits and cachaças and compare it to the identity and quality standards established by national legislation. Despite the great volume of production of these beverages and their national importance, the volume exported is small and the domestic consumption by higher-income people is still incipient due to lack of quality and standardization. Volatile compounds and contaminants established by Brazilian current law were assessed in 268 samples of sugar cane spirit and cachaça collected in the main producing regions. Among the samples, 50.7% did not comply with the Brazilian identity and quality standards. Contaminants (ethyl carbamate, copper, n-butanol, and 2-butanol), higher alcohols, and volatile acidity were the components that presented more irregularities. Ethyl carbamate, congener coefficient, higher alcohols, and volatile acidity had the highest standard deviation. These results indicate that producers still face challenges in adopting best practices to produce these beverages in order to guarantee their quality and standardization. The high number of samples that did not comply with the Brazilian current law is one of the factors that restrains the growth of domestic consumption of sugar cane spirits and cachaças and may explain the low level of export.

The simple analytics of optimal growth with migration

This paper investigates the economic consequences of migration in the Ramsey-type dynamic optimizing context. In contrast to Hazari and Agro (J Econ Dyn Control 28:141–151, 2003) conclusions, we show that migration unambiguously reduces the per-capita domestic consumption growth, whereas necessarily raises the long-run per-capita consumption of domestic residents when production is “sufficiently” reactive to capital changes. Our findings are consistent with several empirical studies and simulation analyses, suggesting that changes in technological adjustment in response to migrants inflows may take some years to translate into productivity, generating some crowding out effects. The gains for natives are likely to materialize in the long run when the specialization of natives adjusts, firms invest in capital and adopt appropriate technologies.