Growth Rate Of Gross Domestic Product Research Articles

The relationship between economic growth, foreign direct investment, trade openness, and unemployment in South Asia

The aim of this article is to investigate the relationship between gross domestic product (GDP) growth rate, inflow foreign direct investment (FDI), trade openness, and unemployment in five South Asian countries between 1998 and 2017 using a vector autoregressive model. It has been empirically found that GDP growth rate and unemployment have positive relationships with FDI. Results demonstrated that there is a directional relationship running from FDI to GDP growth rate and from FDI to unemployment. The study shows that there is a long-run relationship between GDP growth rate, FDI, trade openness’s and unemployment in the region. Macro policies are recommended to accelerate economic growth, FDI, and reduce unemployment rate in South Asia.

Environmental pollution and economic growth: Evidence of SO2 emissions and GDP in China.

This study explores the inherent linkage mechanism between environmental pollution and economic growth using a non-linear MS (M)-VAR (p) model. The results indicate that, first, the growth rates of China's gross domestic product (GDP) and SO2 emissions are in a state of significant inertia. Second, when the system was in a medium-growth regime, the growth rates of SO2 emissions and GDP had a positive correlation, characterized by lower probability and weaker durability. Third, when the system was in a high- or low-growth regime, their growth rates were negatively correlated, characterized by higher probability and stronger durability. Overall, economic growth increases environmental pollution emissions, which intensifies as well as inhibits economic growth. The correlation and sustainability of SO2 emissions and GDP are closely related to the regional status of the entire system. This study is helpful in analyzing the reasons for the nonlinear linkage mechanism between environmental pollution and economic growth.

Equity premium prediction using the price of crude oil: Uncovering the nonlinear predictive impact

Highly cited studies, such as Mork (1989), Hamilton (1996), Hamilton (2003) and Kilian and Vigfusson (2013) establish a nonlinear connection between movements in the real (nominal) price of crude oil and the real gross domestic product (GDP) growth rate. Based on the observation that crude oil price increases have a different impact on the real GDP growth rate than crude oil price decreases, the authors introduce various nonlinear transformations of the price of crude oil to account for the nonlinear predictive impact. Using predictive regressions à la Goyal and Welch (2008), a growing number of studies in recent years have conditioned on these nonlinear crude oil price measures to predict equity premium out-of-sample. By applying the dynamic rotation rule suggested in Zhu and Timmermann (2021), we demonstrate that the form of nonlinearity that helps improve relative out-of-sample point prediction accuracy the most does not have to do with crude oil price increases (decreases) relative to recent prices as perceived by the current literature, but with connecting the relative out-of-sample point prediction performance between the benchmark and the crude oil price-based model with movements in economic variables measuring equity market volatility, economic activity, uncertainty and financial conditions. The statistical evidence of out-of-sample equity premium predictability also translates to economic gains.

INFLUENCE OF PARTICIPATION FORMULA (MUSHARAKAH) IN GROSS DOMESTIC GROWTH IN SUDAN – FOR THE PERIOD 1994-2018

This study aimed to test the effect of the participation formula (Musharakah) on the gross domestic product (GDP) in Sudan. The study used the descriptive analytical method to analyze the annual data for the period 1994-2018. A simple linear regression model was built to find out the relationship between the dependent variable (GDP) and the independent variable (Musharakah), by using SPSS. The most important results were represented in the existence of a positive and statistically significant relationship between the financing with the participation mode and the growth rates of the gross domestic product. .The study recommends; paying attention to the participation formula with a greater value than it is, and expanding dealings in financing through participation formula, because of the controls it acquires that guarantee the success of highly financed projects, in addition to other financing formulas, in order to ensure the diversity of financing methods and their suitability with various economic activities and to give a strong impetus to the growth rates of GDP. Keywords: Financing, Participation Formula, Musharakah, Economic Growth, Domestic Product – Sudan

Structure, functioning, and role of co-operatives in the Nepalese economy

This short paper outlines research investigating the structure, operation, and role of co-operative groups in economic development in Nepal. Microsoft Excel and STATA 16 were used to examine the secondary data collected. In the fiscal year 2020/21, 125 co-operatives (0.42 per cent) are governed by the federal government, 6002 (20.08 per cent) by the provincial government, and 23,759 (79.50 per cent) by the local government. These co-operatives provide direct employment to 88,309 people. The province with the most co-operatives is Bagmati (10,418), where the Gross Domestic Product (GDP) growth rate is the highest (37.7 per cent), and the province with the least co-operatives is Karnali (1967), which has the lowest GDP growth rate (4 per cent). This suggests that the number of co‑operatives in a province influences GDP growth rate (per cent) in that province. The paper concludes by suggesting enabling the development of co-operatives at provincial level can be a significant means in uplifting the overall economic growth of the nation.

Analysis of Economic Recovery Management and Market Capitalization in Nigeria

This study is poised to critically analyze the impact of economic recovery management on market capitalization in Nigeria. The specific objectives of the study include: examining the effect of the Gross Domestic Product (GDP) growth rate on market capitalization, determining the influence of the Inflation rate on market capitalization, and assessing the impact of the Exchange rate on market capitalization. To achieve the objective of the study, the ex-post facto research design was adopted. The researcher used secondary data in collating the required data. The data were collected from CBN statistical bulletin. In testing the hypotheses, multiple regression analysis was used. The findings revealed that the GDP growth rate has a positive impact on market capitalization while the inflation rate and exchange rate harm market capitalization. The study recommends that the Nigerian government should devise a means of increasing the gross domestic product growth rate through effective utilization of their revenue allocation and expending. The study also recommends that during the economic recovery, the Nigerian government should ensure that their inflation rate is reduced. Inflation is the major economic factor that can be hampered by the economic recession can reduce market capitalization in Nigeria.

With the Continuing Increase in Sub-Saharan African Countries, Will Sustainable Development of Goal 1 Ever Be Achieved by 2030?

The poor in Sub-Saharan Africa (SSA) are in a worse predicament than their counterparts in other regions. The goal of this study was to establish the key drivers of poverty in SSA by looking at how economic variables affect growth and poverty. Data from ten SSA nations—upper-middle-income countries (UMIC), lower-middle-income countries (LMIC), and low-income countries (LIC)—were analyzed based on historical values from 2015 to 2019. From the six economic variables studied, the best model reveals that 78% of the differences in poverty can be accounted for using a methodical, statistical approach. Poverty and unemployment rates have a substantial positive relationship (p = 0.001662). The gross domestic product (GDP) growth rate and poverty have a slight link, which is significant at the 10% level (p = 0.067) but is not a significant contributor to poverty alleviation. The secondary school enrolment rate has no bearing on poverty variation (p = 0.33). Increased GDP does not necessarily correspond to poverty reduction. Unemployment, on the other hand, is a major contributor to poverty in the region. Moreover, education (secondary school ennoblement) plays a less important role in reducing poverty, whereas per capita personal consumer spending and GDP growth rate have a bigger impact on poverty reduction. The proposed theoretical and numerical model works on general indicators and trends; it does not guarantee that people in the UMIC, LMIC, and LIC countries may not fall below the international poverty line ($1.90 per day). The poverty rates are predicted to climb by more than 2% by 2030, postponing poverty elimination in the SSA region by almost five years. This signifies that more than half of the SSA population will remain poor.

Militarization, Investment and Economic Growth 1995-2019: Initial Global Findings

The economic effects of defense spending have attracted considerable attention in the literature. Invariably, the defense burden, i.e., the military spending to GDP (gross domestic product) ratio, is the variable through which these effects are empirically traced. In this article, an alternative measure that captures the burden on the economy and society from allocating resources to the defense sector is used—the Global Militarization Index (GMI), constructed by the Bonn International Centre for Conflict Studies (BICC). The empirical investigation covers a total of 116 countries and spans the period 1995–2019. The results reported herein do not reveal any systematic and statistically significant relation between a country’s militarization levels and two main macroeconomic variables (growth rate of GDP and gross fixed capital formation as a share of GDP).

Macroeconomic factors and financing strategies in working capital: Evidence from China

AbstractChanging economic situation of a country affects working capital by influencing lenders' financing abilities, firms' business activities, and managers' decisions. Hence, this paper explores the influence of macroeconomic factors in the relationship between working capital financing and firm performance over the period of 2000–2018. Applying the two‐step generalized methods of moments, we found a non‐linear and inverted U‐shaped relationship between working capital finance (WCF) and firm performance, significantly influenced by the macroeconomic indicators that is, gross domestic product (GDP) growth, Inflation rate, and interest rate. We segregated the data regarding the global financial recession period 2008–2010 and disclosed that the non‐linear and inverted U‐shaped relationship between WCF and firm performance turns to linear and negative during this recession period. We also evaluated the role of GDP growth, inflation, and interest rate in WCF and firm performance relationship during the global recession and found that these factors do not influence the nexus during this period. Firm managers, lending agencies, and researchers may use these results in choosing the best financing options in working capital under the changing situation of macroeconomic factors. The WCF and firm performance analysis during the global recession period (2008–2010) may be the best prediction model for the current financial crisis caused by COVID‐19.

Energy Demand Projection and Economy Nexus of Pakistan

In the fundamental study to design sustainable electricity generation, long-term electricity demand forecasting has taken on a crucial role. The Low Emissions Analysis Platform (LEAP®) software is used in this study to estimate the demand for energy by various consumer groups including commercial, residential, agricultural, and industrial for the study period (2023-2050). The electricity demand is forecasted under different Gross Domestic Product (GDP) growth scenarios. The developed scenarios are reference, low economic growth, medium economic growth, and high economic growth scenarios. This study identifies the key relationship between energy demand and the economy of Pakistan. It is found that energy demand and the GDP of the country have a direct relationship as one quantity increases, the other one also increases, and vice versa. 3.56% growth rate of GDP under the low GDP growth scenario causes an increment in energy demand from 137.97 million MWh in 2023 to 374.79 million MWh. Medium and high GDP growth scenario pertains to GDP growth rates of 5.79% and 10.22% which causes an increment in energy demand to 652.17 million MWh and 1,244.75 million MWh by 2050. The results of this study are significant and provide insight into electricity demand growth under the economic scenarios that could be useful for sustainable electricity planning in Pakistan.

Predicting LCR with GDP, NPLs and ROE

This paper aims to examine drivers of Liquidity coverage ratio (LCR) in Croatia. The intention of this study is to examine and analyse the effect of Return on Equity (ROE), Non-performing Loans (NPL), and Gross domestic product (GDP) on Liquidity Coverage Ratio (LCR) in the Croatian banking sector. The population of this study is Croatian banking sector from q3 2016 to q3 2021. Empirical results suggested real GDP growth rates and NPL levels as LCR drivers in Croatia while effects from ROE were not empirically supported. The results of this study indicate NPLs and GDP simultaneously affect LCR. Consequently, the study has implications for banks in Croatia.

Autoregressive Distributed Lag Approach (ARDL) to Corruption and Economic Growth Nexus in Nigeria

The corruption in Nigeria is generating concern around the globe and among its citizens. This concern is because corruption has continued undermining the country's socio-economic development. Thus, this study empirically investigates the impact of corruption on economic growth in the Nigerian economy using annual data from 1980 to 2018. The study employed the autoregressive distributed lag (ARDL) model as its estimation technique. In this study, economic growth was proxied by gross domestic product growth rate (GDPGR), while corruption was proxied by the corruption perception index. The result revealed that corruption has a negative and significant impact on economic growth in Nigeria in the long run. This finding implies that corruption has impeded the economic development process in Nigeria within the period of this study. Thus, it was recommended that anti-corruption agencies in Nigeria, such as the Economic and Financial Crime Commission (EFCC) should be strengthened by enacting laws that will empower them to investigate, arrest and prosecute offenders.

The Macroeconomic Determinants of Non-Performing Loans in Bangladesh: An Empirical Analysis

Bank plays intermediary role which is very important for the development of any nation that can be affected by the non-performing loan. This study investigated the macroeconomic determinants of non-performing loans in Bangladesh using the time series data from 1990 to 2020 collected from Bangladesh Bank, Bangladesh bureau of statistics, World Bank, International Monetary Fund (IMF) data on World economic outlook and International Labour Organization (ILO) Statistics. The time series is chosen from 1990 to 2020 because of expansion of private commercial banks and availability of data of gross loans and amount of Non-performing loan amounts. The dependent variable considered in this study was percentage of non-performing loan to gross loan (NPL) and the independent variables were gross domestic product growth rate (GDPGR), inflation (INF), lending rate (LR), exchange rate (ER), money supply to gross domestic product (M2GDP) and unemployment rate (UR). NPL was positively influenced by GDPGR, LR and ER and negatively influenced by INF, M2GDP and UR. The government should direct its monetary and fiscal policies towards reducing Non-Performing Loans by creating an environment for business growth for the provision of social and infrastructural facilities.

What Matters More for Emerging Markets Investors: Economic Growth or EPS Growth?

Investors often allocate to emerging market equities with the expectation that higher rates of gross domestic product (GDP) growth typical of developing economies will translate to better stock market returns. Adherents to this conventional wisdom have historically been disappointed, as numerous studies of emerging and developed markets have shown GDP growth to be unreliable in predicting country-level stock returns. Using data from 15 emerging and 21 developed equity markets over samples ranging from 32 to 120 years, we confirm the failure of GDP growth as a cross-sectional predictor. What truly matters to investors is not an overall increase in economic output but rather the growth in listed companies’ earnings per share (EPS) and dividends per share (DPS), which ultimately flows to shareholders. The authors confirm that, unlike changes in GDP, growth in EPS and DPS exhibit a strong positive correlation with country-level equity returns, offering emerging market investors a more effective tool for thinking about allocation decisions. Surprisingly, they also find that most emerging economies, despite their high GDP growth rate, have low EPS and DPS growth rates, suggesting that listed companies are not representative of the underlying economy.

Assessing Residual Seasonality in the U.S. National Income and Product Accounts Aggregates

Abstract There is an ongoing debate on whether residual seasonality is present in the estimates of real Gross Domestic Product (GDP) in U.S. national accounts and whether it explains the slower quarter-one GDP growth rate in the recent years. This article aims to bring clarity to this topic by (1) summarizing the techniques and methodologies used in these studies; (2) arguing for a sound methodological framework for evaluating claims of residual seasonality; and (3) proposing three diagnostic tests for detecting residual seasonality, applying them to different vintages and different sample spans of data on real GDP and its major components from the U.S. national accounts and making comparisons with results from the previous studies.

Impact of Economic Reforms on FDI and GDP After 1991 in the Case of India

Abstract: The aim of the present study was to examine the impact of new economic reforms after 1991 on the Indian economy in general, GDP1 growth rate and FDI2 inflow. The Economic and political policy intervention were reflected on the economic development of the countries with respect to improving considerable growth rate in GDP and FDI. Specifically in the Indian context, the economic decisions have been a considerable influence on the inclusive growth rate of the nation as well as standard of living. It is evidence that India started the economic reform in 1991, after the crisis of balance of payment3 (BOP). After that the government initiated economic reforms basically to provide an environment of sustainable growth rate and stability. During the reform period, a considerable number of policies were introduced. After that the government of India has introduced three key policies which are liberalization, privatization, globalization (LPG). This study, with the help of secondary data, shows that after the reforms, the economy’s growth rate started increasing positively and stable. Keywords: Economic reforms, Foreign Direct Investment (FDI), Gross Domestic Product (GDP), Economic growth, Growth rate of India, India after 1991, etc.

Modeling COVID-19 effects on SDGs using system dynamics in Egypt

The coronavirus disease 2019 (COVID-19) poses a significant threat to achieving the Sustainable Development Goals (SDGs). To address this challenge, a thorough examination of the pandemic’s influence on four SDGs in Egypt is presented in a system dynamic model. The addressed goals are related to no poverty (SDG 1), zero hunger (SDG 2), decent work and economic growth (SDG 8), and climate action (SDG 13). The model is simulated over 35 years extending from 2015 to 2050. Furthermore, a web-based interactive learning environment is developed to analyze the interdependencies among public health activities and study the impacts of possible intervention countermeasures or prevention policies. Indicators including poverty line, food insecurity, gross domestic product (GDP) growth rate, and greenhouse gas (GHG) emissions are evaluated to track Egypt’s performance in relation to SDGs 1, 2, 8, and 13. According to the simulation model, the poverty line will continue to decline until it reaches around 16% by 2050. According to the significant governmental efforts to follow its vision of 2030, Egypt can achieve a decreasing percentage of food insecurity, reaching 3% in 2030, and this percentage will continue to decrease until it reaches full sufficiency by 2050. The GDP growth rate will rise every year until it reaches 13.71% in 2050. With respect to climate, GHG emissions are predicted to fall to roughly 97 Mt CO2-equivalents by 2050. This approach revitalizes debates about the achievement of SDGs amid the crisis and acts as a powerful tool that aids decision-makers in identifying leverage points to avoid the long-term negative repercussions of the crisis on the economy, people, and environment.

THE FISCAL IMBALANCE AND CLIMATE CHANGE OBLIGATIONS: WHAT IS FEASIBLE FOR DEVELOPING ECONOMIES?

The developing world is facing multidirectional challenges of socioeconomics in the era of Sustainable Development Goals (SDGs-2030). Fiscal indicators like fiscal imbalance and debt financing are the key hurdles in financing sustainable environment projects. This study attempted to probe the impact of the fiscal indicators on the environmental conditions of the South Asian region. For a comprehensive analysis, the study utilized a dataset of all eight countries of South Asia for 19 years. Per capita greenhouse gas emission has been used as a dependent indicator, while fiscal imbalance anddebt to gross domestic product (GDP) have been taken as independent indicators along with energy consumption, energy intensity and GDP growth rate. The generalized least squares and quantile autoregressive distributive lag methods have been adopted from econometric for this empirical analysis. Both ways confirm that fiscal imbalance and debt financing play a significant role in greenhouse gas emissions accumulation in the entire region of South Asia. Energy consumption and the cost of producing energy (energy intensity) are the other sources of greenhouse gas emissions accumulation in the area. This study suggested that developing economies of South Asia may not be able to fulfill their commitments regarding SDGs-2030 if their issues of fiscal imbalance and debt financing have not been treated initially.

Dynamic variations of cyanobacterial blooms and their response to urban development and climate change in Lake Chaohu based on Landsat observations.

Recurring cyanobacterial blooms have seriously hindered the sustainable development of cities. In this study, the variation trend of cyanobacterial blooms was analyzed by taking Lake Chaohu in China as the study area, and the Normalized Difference Vegetation Index (NDVI) derived from Landsat observations combined with the development index of surrounding cities from 2009 to 2019 was used to quantitatively analyze the response of cyanobacterial blooms to urban development and climate change. The results showed that the NDVI of the Northwest Lake region was significantly higher than that of other regions. Summer and autumn were the main seasons for the outbreak of cyanobacterial blooms. The NDVI of Lake Chaohu and Baohe Lake region showed a significant correlation with the gross domestic product (GDP) growth rate of Hefei city (HF), the districts and counties around the lake (DCL), Baohe District (BH), and the population (P). As the economic regions gradually focused on BH rather than on HF and DCL, there was an increasing trend correlation between the NDVI of Baohe Lake region and the GDP growth rate. However, the elimination of GDP in BH did not affect the consistency relationship between the economic growth of other regions and the NDVI of Lake Chaohu on a large scale. In addition, the results of relative importance analysis indicated that the GDP growth rate of BH and the area of Hefei except DCL (HF-DCL) accounted for important contribution to the [Formula: see text] of the regression. This study has momentous reference value for understanding the coupling relationship between urban development and lake environment.

Evolution of Monetary Policy in Peru: An Empirical Application Using a Mixture Innovation TVP-VAR-SV Model

Abstract This article discusses the evolution of monetary policy (MP) in Peru in 1996Q1–2019Q4 using a mixture innovation time-varying parameter vector autoregressive (VAR) model with stochastic volatility (TVP-VAR-SV) as proposed by Koop, Leon-Gonzales and Strachan. The main empirical results are: (i) the VAR coefficients and volatilities change more gradually than the contemporaneous coefficients over time; (ii) the volatility of MP shocks was higher under the pre-Inflation Targeting (IT) regime; (iii) a surprise increase in the interest rate produces gross domestic product (GDP) growth falls and reduces inflation in the long run; (iv) the interest rate reacts more quickly to aggregate supply shocks than to aggregate demand shocks; (v) MP shocks explain a high percentage of domestic variables behavior under the pre-IT regime but their contribution decreases under the IT regime. Overall, these results show that MP has contributed in Peru to lower macroeconomic volatility by (i) reducing average long-term inflation, (ii) increasing the response of GDP growth rate to interest rate, and (iii) by becoming more predictable. (JEL codes: C11, C32, and E52).