Financial Growth Research Articles

Financial Performance Analysis of Local Government: A Case Study on Karanganyar Regency

The purpose of this study is to analyze the financial ratios of the Karanganyar Local Government Budget Realization Report for the 2017-2022 fiscal year, with a quantitative descriptive method at the Local Finance Agency (BKD) of Karanganyar Regency. Data were sourced from the budget realization reports, scientific articles, and interviews. Data were collected through document analysis and interviews. The components analyzed include the financial independence ratio, financial growth ratio, effectiveness ratio of original local government revenue (PAD), and local financial efficiency ratio. This study has found a low financial independence ratio of an average of 23.62%. The average PAD growth ratio was 5.14%, local income was 1.98%, operational expenditure was 1.80%, and capital expenditure was 3.72%. The PAD effectiveness ratio was classified as very effective with an average of 107.22%, and the financial efficiency ratio showed a moderate level with an average of 87.17%. This study concludes that the financial performance of the Local Government of Karanganyar Regency needs to be improved. The researchers recommend the government diversify sources of income, evaluate project management, and utilize information technology. Thus, this study provides guidance for the Local Government of Karanganyar Regency in improving the local financial performance.

Financial Performance Of Sharia Commercial Banks In Indonesia: Does Capital Structure Matter?

Islamic banking has experienced a surge in financial growth in the last decade. Global economic challenges have encouraged many conventional banks to transform into sharia banks. Sharia banking can increase its operational efficiency by applying debt and equity financing methods by trade-off theory. This research investigates the effect of capital structure as measured by the debt-to-asset ratio (DAR) and debt-to-equity ratio (DER) on the financial performance of Sharia Commercial Banks as measured by return on assets (ROA) and return on equity (ROE). This research is quantitative with multiple linear regression analysis techniques. The data source comes from OJK Sharia Banking Statistics for 2017-2021. This study shows that DAR and DER have a significant effect on ROA. Apart from that, DAR has a substantial impact on ROE. However, this study indicates that DER does not significantly affect ROE.

Comparison of Hong Kong And Taiwan Economic Development in the Context of the Oil Crisis

Hong Kong and Taiwan are part of China and are similar in politics, economy, culture, etc. But in response to the two oil shocks in the 1970s, the two places showed different patterns of economic decline. Taiwan's economy reacted quickly to the oil shock, but the decline was more moderate, while Hong Kong's recession tended to lag global crises, but the reduction was more significant. From the perspective of industrial structure, this paper analyzes the differences in development strategies and industrial structure before the first oil strike and between them through case comparison. This paper finds that Taiwan's economic decline pattern was closely related to its vigorous development of the import substitution industry. In contrast, Hong Kong's industry and trade were less affected, but the rapid growth of finance and real estate at that time created economic instability. The author believes retaining a specific high-end manufacturing industry can stabilize the local economy. The conclusions of this paper can be used for reference in the economic transformation of developing regions.

How does green finance strategy foster the green transition? Based on the perspective of provinces’ green total factor productivity

China’s Green Finance (GF) policy has been making significant strides toward the transition from a resource-oriented society to one that is resource-conserving and environmentally sustainable. Policymakers are currently focused on increasing green output to facilitate the next stage of green financial growth. In this study, we use panel data from 30 Chinese provinces between 2011 and 2020 to empirically analyze GF’s effect on Green Total Factor Productivity (GTFP). Evidence reveals that GF has a significant positive effect on provincial GTFP by promoting investment in innovation and optimizing industrial structure. However, the positive impact of GF on GTFP can be mitigated by green technology innovation output, highlighting the need for collaborative strategies for GF policy implementation and technology advancement. Furthermore, with the expansion of fintech innovation, the reduction of carbon emissions, and the intensification of environmental regulation, the effect of GF on GTFP is even more pronounced.

The role of Fintech, natural resources, and renewable energy consumption in Shaping environmental sustainability in China: A NARDL perspective

China emits a third of global pollution. This results in severe environmental damage across the world. There is a resounding need to develop means to maintain the sensational economic progress of the country and achieve environmental sustainability too. Despite the efforts from China to transition away from fossil fuels, most of the energy demand is still met using coal. China stands to be one of the largest producers and users of coal in the world. All these factors are a severe barrier in the country's quest to become carbon neutral by 2060. This research studied the role of Fintech, Natural resources and Renewable Energy consumption in achieving environmental sustainability. Fintech can help digitalize the financial industry and play a vital role in reducing CO2 emissions from the financial industry. Furthermore, it can be an effective means to promote the growth of green finance and green investment. The increased use of natural resources can be detrimental to the environment. Furthermore, the transition towards renewable energy consumption can reduce emissions and help to develop a sustainable environment in China. The study recommends using a carbon tax to curb CO2 emissions and use the advances of Fintech to promote investment in the green infrastructure of the economy. Using natural resources should be discouraged with increasing taxes, while renewable energy use should be encouraged with various subsidies.

Islamic Financial Stability: Previous Research based on Scopus Database

The global financial system is growing rapidly in a large number of countries in the world, and Indonesia is no exception. The growth of Islamic finance in Indonesia has also experienced a significant increase as indicated by Indonesia's financial assets in the global top ten. The economic crisis a decade ago has accelerated the development process of Islamic finance. These conditions have proven that Islamic finance has a strong enough stability compared to conventional finance. There are still many researchers' contradictions on the stability of Islamic finance. This study aims to determine the development of Islamic Financia l Stability research trends published by leading journals on Islamic financial economics. The data analyzed consisted of 263 indexed research publications. The data is then processed and analyzed using the VoSviewer application to find out the bibliometric map of Islamic Financial Stability research development.

From Borrowing to Growth: Ghana’s Public Debt Strategy within its Financial Development Trajectory

Purpose: The study examined the implications of Ghana’s soaring public debt on its financial development, specifically its banking behaviour. Given Ghana’s alarming public debt of 78.3% of GDP by 2022 and previous periods of high public debt correlating to global economic downturns, understanding this relationship is vital for both local and international policymakers.
 Methodology: The research employs annual growth rates of various financial development indicators (e.g, Ease of Doing Business Index and Digital Transaction Index) and measures public debt using the Public Debt-to-GDP Ratio. Advanced econometric methods were used to ensure data accuracy, including cointegration, error correction models, and tests like Dickey-Fuller, Augmented Dickey-Fuller, and Sargan-Rhargava Durbin-Watson.
 Findings: The ADF test confirmed the stationarity of all study variables. Cointegration tests show a long-term equilibrium relationship among the variables. In the short run, a positive and significant relationship exists between variables such as Domestic Bank Intermediation, Financial Development, and Public Debt. Regression outcomes indicate that as Public Debt escalates, there’s an associated increase in Financial Development in Ghana.
 Implications: These findings reveal that despite the potential pitfalls of high public debt, a complex dynamic exists where increasing public debt positively correlates with financial development in Ghana’s short run. This insight can be valuable for policymakers in balancing infrastructural investments, social programs, fiscal sustainability, and financial growth, especially for developing nations facing similar debt scenarios.
 Originality: This study offers a unique, in-depth three-decade analysis (1992-2022) on the relationship between Ghana’s public debt and banking behaviour. It is an empirical precedent for other nations to understand the intricate relationships between public debt and financial growth.

The performance and influencing factors of high-quality development of resource-based cities in the Yellow River basin under reducing pollution and carbon emissions constraints

It is important to clarify the high-quality development performance (HQDP) of resource-based cities in the Yellow River Basin (YRB) and its influencing factors under reducing pollution and carbon emissions constraints, in order to encourage ecological protection and high-quality development in the YRB. In this paper, we measured the HQDP of 36 resource-based cities in the YRB under reducing pollution and carbon emissions constraints from 2006 to 2020 using the super-efficient SBM model, and explored the factors that impacted HQDP by a bidirectional fixed-effect model. The findings showed that: (1) The HQDP of resource-based cities presented an obvious distribution feature of “higher upstream and downstream, lower middle reaches”, and the regenerative cities had the highest HQDP, followed by the growing, mature and declining cities. (2) Economic growth level and environmental regulation had a remarkable positive impact on HQDP, energy intensity had a considerable negative impact on HQDP, and industrial structure, openness and financial growth level had a marked heterogeneity on HQDP of various kinds of cities. On the basis of this, suggestions were proposed to increase the HQDP of resource-based cities in the YRB.

Studying financial development with low-carbon architecture development and green technological innovation: sustaining SDG-9.

In order to accomplish Sustainable Growth Goal 9, this research analyzes in detail how green technological innovation, low-carbon architectural improvement, and more significant financial growth all work together to reach the goal. This research meticulously integrates secondary data from reputable sources to examine the relationship between economic growth, technological innovation in the built environment, and environmental sustainability from 1994 to 2019. For economic insights, the World Bank's World Development Indicators is a go-to resource, while Yale University's Environmental Performance Index (EPI) is a go-to for environmental metrics. Our research is based on this synthesis of multi-dimensional data, which enables an in-depth investigation of the interplay between financial development, sustainable architecture, and technical progress toward SDG-9. This research employs quantitative and qualitative methodologies to shed light on the intricate interaction between these elements, making it useful for policymakers, scholars, and stakeholders dedicated to directing sustainable development paths.

КОРУПЦІЯ ТА ФІНАНСОВИЙ РОЗВИТОК: ПРОБЛЕМИ І ПЕРСПЕКТИВИ НАУКОВИХ ДОСЛІДЖЕНЬ

The article analyzes trends in the scientific literature on corruption and financial development, as well as corruption and financial growth, and further clustering to identify problems and future research directions. The analysis covered 3211 documents from Scopus databases. Using the built-in analysis tools of the Scopus database, it was found that the number of publications on corruption and financial development began to grow rapidly in 1994, and in 2023 the number of papers increased by 350% compared to 2010. The largest share of researchers who studied these issues came from the United States, China, the United Kingdom, Nigeria, and Australia. The clustering performed with the help of the VOSviewer software tool allowed to determine that out of the 7 clusters identified, the most significant are: the second cluster, which united publications related to corruption, financial development and sustainable growth; the third cluster, which links corruption, financial growth and human capital; and the fourth cluster, which is dedicated to the study of the relationship between corruption and financial growth. The most interesting is the seventh cluster, which includes only one keyword - regional development, which indicates a small share of publications devoted to the impact of corruption on regional development.

Government and Polluting Companies Game Strategies in the Context of Green Finance A Prisoners Dilemma Game Model

Promoting the development of green industries to facilitate the growth of green finance has become a consensus among various sectors of society. This article focuses on the game theory strategies between governments and polluting companies in the context of green finance. Taking the Prisoner's Dilemma game model as an example, we discuss if polluting companies, under different types of governments, would choose to allocate loans towards improving production and environmental projects. Furthermore, we analyze whether the preferences of the general public towards eco-friendly products would influence the game strategies of governments and polluting companies. Through solving the model, we find that when governments increase penalties for polluting projects, reduce the costs of environmental project research and development for polluting companies, enhance environmental awareness among the general public, and stimulate their preference for eco-friendly products, they can strengthen corporate social responsibility and promote green investments. Consequently, polluting companies are more likely to invest in environmental projects to gain greater returns.

Place of the banking system of Ukraine in the post-war reconstruction of the country

Methods. The theoretical and scientific-methodological basis of the research was made up of the principles of financial science and banking. Methods of analysis and synthesis were used during the study of the impact of historical events taking place in modern Ukrainian society on the development of the banking industry. Factors ensuring the stability of the banking system of Ukraine in an unpredictable economic environment were investigated using the system approach. Factor analysis made it possible to determine the role of the banking system in the modern development of the national economy, as well as to determine its mission in the period of post-war recovery of the Ukrainian economy. Results. The study identified the specifics and problems of the functioning of the banking system of Ukraine in the conditions of martial law and outlined its role in the further post-war reconstruction of the country. The sensitivity of the banking system of Ukraine to the influence of martial law and the growth of external financing of the state and social sector was revealed. In addition, the study showed that the state of war has a serious negative impact on the lending processes of the Ukrainian economy: an increase in the level of non-repayment of loans, deterioration of the quality of bank assets. It is argued that this problem should be solved in the context of post-war reconstruction. The main areas of activity of the National Bank of Ukraine, the legislative authorities and the banking institutions themselves to overcome the negative impact of the martial law are determined, taking into account the international experience of the development of the banking system during the post-war reconstruction of the country. The received recommendations are aimed at developing the banking system and increasing its influence on the economic growth of the country after the war. Novelty. The study paid attention to lending by Ukrainian banks in the post-war period, and also took into account the impact of military actions on the territory of Ukraine. This made it possible to establish how military conflicts affect the financial stability of the banking system of Ukraine and how this is reflected in the lending of economic projects in the country. This interaction became a key element of the study, which contributed to a better understanding of the challenges facing the banking system of Ukraine in the conditions of post-war recovery. Practical value. Strategies for the development of the banking system in Ukraine in post-war recovery are proposed, using international experience and taking into account the state of war.

Modeling Finance–Growth Nexus in MENA Region Economies: A Panel Data Analysis

The primary objective of this paper is to examine the relationship between finance and economic growth in a cohort of 16 economies within the MENA region spanning a four-decade period from 1980 to 2021. This study employs panel unit root and panel co-integration analyses to investigate this long-term nexus. The fully modified and dynamic Ordinary Least Squares (OLS) approaches are utilized to estimate the long-run coefficients. The findings underscore the existence of cross-sectional interdependence among these nations. Furthermore, Pedroni’s panel co-integration research robustly supports the idea of a long-term co-integrating relationship between financial development and economic growth. Our long-run panel estimations reveal a positive and statistically significant impact of financial development on GDP per capita income growth. In addition to this broad analysis, this paper conducts a detailed time-series examination focused on a specific country to validate the robustness of the results. These findings further substantiate the favorable influence of financial development on income growth in the majority of MENA nations. Notably, private sector participation in these economies is found to be alarmingly low. As a result, a significant policy implication of this study underscores the urgent need for policymakers to prioritize measures conducive to private sector expansion. Moreover, enhancing financial inclusion, addressing the crowd-out effect, and tackling non-performing loans are critical areas requiring attention within the MENA region. Furthermore, our research highlights the potential benefits of developing stock markets as part of an optimal strategy to enhance both economic and income growth rates. In conclusion, this study contributes valuable insights into the finance–growth nexus in the MENA region, emphasizing the importance of financial development as a driver of economic prosperity and the need for targeted policy initiatives to support private sector growth and financial stability.

A theoretical framework for modeling dual-track granting orientation in green credit policy

This study delves into the realm of green credit policy, a recognized solution for harmonizing financial growth with environmental progress. It highlights the pivotal role of credit-granting orientation in determining the effectiveness of green credit. Introducing a dual-track mechanism that combines industry and enterprise activity orientation, the study provides novel insights into green credit granting. Based on theoretical modeling and simulation analysis, the study explores how different granting orientations in green credit impact enterprise economic and environmental performance using stochastic dynamic programming. The results underscore that industry-oriented granting constrains eco-innovation capital investment and credit fund inflow, while activity-oriented granting leads to reduced carbon emissions and enhanced enterprise value. A dual-track green credit approach demonstrates a superior balance between the two orientations, delivering higher carbon emission reduction effects than industry-oriented granting and more sustainable impacts on enterprise value than activity-oriented granting. Ultimately, the study advocates for differentiating green credit into two orientation types and leveraging eco-innovation activities as credit allocation criteria to enhance the efficiency of green credit operations.

A Business Acquisition Case on Jollibee Foods Corporation’s Purchase of Mang Inasal

This case is about the largest quick-service restaurant (QSR) conglomerate in the Philippines, Jollibee Foods Corporation (JFC), acquiring its fastest growing competitor Mang Inasal (MI). At a time when MI was on its best trajectory toward expansion and financial growth, its CEO, Edgar Sia, sold 70% of the company to the market leader for P3 billion in 2010 and the remaining 30% of the stake for P2 billion in 2016—whopping amounts which, in the eyes of JFC Management, were reasonable enough to fully acquire a highly prized company. Organizing information drawn from public sources, the author wrote this case to encourage intellectual discourse among students and professors of business as they critically analyse the acquisition decision, both from the standpoint of MI and JFC.

Assessing factors influencing renewable energy deployment and the role of natural resources in MENA countries

Governments worldwide are deploying renewable sources as a part of an imperative agenda to overcome the detrimental impacts of climate change and environmental degradation. Although renewable energy contains several benefits, very few researchers have worked on the determinants of renewable energy deployment and the role of natural resources in the Middle East and North Africa (MENA) countries. This research contributes to the prior literature by examining the influence of financial growth, governance, environmental quality, and economic development in MENA countries from 1990 to 2020. For empirical estimation, this study employs the latest econometric approaches: cross-sectional autoregressive distributed lag (CS-ARDL), augmented mean group (AMG), and Westerlund & Edgerton's cointegration. Furthermore, the cross-sectional augmented Im-Pesaran-Shin (CIPS) and cross-sectional augmented Dickey-Fuller (CADF) panel unit root tests are employed to check the stationarity level among variables. The empirical outcome demonstrates that governance, financial growth, the interaction term between financial growth and governance, carbon emissions, and economic development significantly and directly influence renewable energy deployment in MENA countries. As a further step, robustness is checked by employing the AMG estimator. The findings from the AMG estimator verify the robustness of the study's outcomes. Thus, the empirical and robustness results make it clear that all the aforementioned variables play a significant role in renewable energy deployment in the sampled region. The policy consequences of the major efforts are laid out as well coherently and consistently.

The Influence of Socio-Economic and Psychological Factors on Millennial Generation’s Stock Investment Decisions

Purpose : Increasing investment awareness among the public, especially among millen- nials, is crucial for the development of the stock market and overall financial growth. As a significant potential force, millennials can play a vital role in increasing stock investment decisions and fostering economic progress. This study aims to develop an integrated model of the influence of socioeconomic and psychological factors, namely return expectations, self-efficacy, and risk perception, on millennial stock investment decision-making behavior. Method : The research population was millennial stock investors. Non-probability sampling technique was used to obtain 336 respondents. Data were collected through the survey method using a questionnaire. Data were analyzed using the partial least square (PLS) technique. Findings : Based on the analysis, socioeconomic factors influence investment deci- sions, return expectations, self-efficacy, and risk perception. Socioeconomic factors influence investment decisions through return expectations, self-efficacy, and risk per- ception. However, risk perception does not directly affect millennial stock investment decisions. The results of this study can be used as a reference to motivate young people to invest intelligently in the stock market. Novelty : The research was conducted on the millennial generation, who have an im- portant role in stock investment decisions, considering that the millennial generation is the generation that has an important role in increasing stock investment. Keywords : Expected Return; Self Efficacy; Risk Perception; Investment Decision

Utilizing the resources efficiency: Evidence from the impacts of media industry and digitalization

This study explores the intricate link between media, cultural industries, and mineral resource efficiency in ten major global CO2 emitters from 2000 to 2020, using the CS-ARDL technique. Key findings indicate that the culture and media sector's value addition positively impacts mineral resource efficiency, particularly in the long term, underscoring the need for sustained efforts in this sector. Financial development shows a positive correlation with mineral resource efficiency, with a 1% increase corresponding to about 0.36% and 0.41% increases in short- and long-term mineral resource efficiency, respectively. Poverty ratios are negatively correlated with mineral resource efficiency, highlighting the importance of addressing poverty to indirectly enhance resource efficiency. The study also demonstrates a positive relationship between ICT development and resource efficiency, showcasing digitalization's role in optimizing resource utilization. Good governance and patent applications are positively linked to mineral resource efficiency, emphasizing transparent governance frameworks and innovation. Policy recommendations for major CO2 emitters include leveraging media for sustainability awareness, poverty alleviation, ICT diffusion, fostering green finance growth, and supporting green patent development.

Integrated Macroeconomic Variables and Financial Growth of the Real Estate Sector in Kenya

The real estate sector has been growing over the years because of major infrastructural developments and high population growth in Kenya. However, the sector has been facing some challenges that have been affecting its growth. This research aimed to assess how macroeconomic factors influence Kenya’s real estate financial success. The research primarily focused on determining inflation, interest rates, exchange rates’ impact and economic growth on Kenya’s real estate sector. The study was underpinned by demand-pull inflation theory, the classical/neo classical theory for interest rates, the classical growth theory and purchasing power parity. The study employed causal research design and targeted three main Kenyan real estate developers in Kenya; Cytonn Investments, Hass Consult, and Knight Frank. In light of the small target population, a census approach was used and the research employed secondary data. As a result, secondary data from the property developers’ yearly market reports from 2016 to 2022 was gathered. Pearson’s correlation and panel data analysis methods were also employed. The findings revealed that the relationship between inflation, interest rates, exchange rates and economic growth revealed R-squared value of 0.8057, implying that the macroeconomic variables explains around 81% of the variation in financial growth within the real estate sector. The study also found that inflation had positive and significant effect on financial growth (β =0.0045187, p=.048<.05), interest rate had positive and significant effect on financial growth (β =0.044177, p=.011<.05), exchange rate had negative but insignificant effect on financial growth (β =-0.0178337, p=0.227>.05), economic growth had positive and significant effect on financial growth (β =0.0980943, p=0.007<.05). The study recommends that financial institutions, policy makers, and developers should implement measures to mitigate the adverse effects of high inflation on the real estate sector. Keywords: Inflation, Interest rates, Exchange rates, Economic growth, Macroeconomics factor.

The Development of Internet Finance in China under the Background of Digital Economy

Internet finance is a financial operation mode in the network era, which is produced to meet the requirements of the fast-developing e-commerce, and has been widely popularized throughout China. This paper mainly studies the development path of China's Internet finance under the background of the digital economy. This paper presents a thorough analysis of the growth of Internet finance based on the examination of big data technologies. This study reveals that one of the crucial avenues for market growth is now big data technologies and plays a key role in the development of Internet finance. In the future, it can be further developed from the directions of user portrait, risk control system and Internet finance industry chain.