High Economic Growth Research Articles

Does Debt Have Threshold Effects on Medium-Term Growth? Evidence from European Union Countries

Abstract Debt has become an important factor in economic activity and its extent has incentivized many researchers to incorporate it into contemporary growth models. On the positive side, debt has the ability to smoothen private consumption, firms’ investment and government expenditure in relation to their corresponding income, subsequently leading to better capital allocation. However, the history of debt defaults and lessons from European sovereign debt crises, which were accompanied by strict austerity measures, have warned us about the danger of debt overhang and unsustainable debt burdens. This paper tackles the question of the existence of a turning point, at which the negative effects of debt start to prevail in the economic process. In the sample of European Union countries in the period from 1995 to 2019, the author of this paper investigated the presence of threshold effects of government, non-financial corporate and household debt on medium-term growth following the paper by Mika and Žumer (2017). The author first confirmed the concave-shaped relationship between public debt and growth with a threshold of 111.6% of GDP, based on Eurostat debt-to-GDP data. In contrast, private debt was found to have first lag effects with an accompanied convex-shaped relationship between private debt and growth and with a corresponding threshold of 149.8% of GDP. Next, the author divided private debt into non-financial corporate and household debt to investigate a more detailed relationship between debt and growth. Corresponding to the Global Debt Database, the concave-shaped relationship between public debt and growth was confirmed with a threshold of 104.8% of GDP. Both of the investigated types of private debt confirmed the previously explored lagged impact on medium-term growth and a convex-shaped relationship between non-financial corporate and household debt and growth. The threshold of non-financial corporate debt stands at 138.3% of GDP, while that for household debt is 145.1% of GDP. Considering the presence of thresholds may offer an important message to economic policymakers, as timely and suitable governance can lead to either higher economic growth or prevent adverse effects of excessive indebtedness.

Numerical Analysis for Ground Subsidence Caused by Extraction Holes of Removed Piles

Around the world, and especially in Japan, the tearing down of social infrastructure, including civil engineering structures, has been increasing due to the aging of these constructions, which were built during a period of high economic growth, and a decrease in their utilization caused by a recent drop in the population. The number of existing pile foundations being pulled out has gradually risen to a higher number than that of pile foundations being newly installed. However, after the pulling-out of a pile foundation, the mechanical characteristics of the surrounding ground are of great concern due to the existence of the holes that form when the existing piles are removed (extraction holes). In this study, a three-dimensional elasto-plastic consolidation analysis was performed to examine the effect of the extraction holes of removed piles on the static properties of the surrounding ground. As examples of the results of the analysis, if an extraction hole of a removed pile is left as it is, large ground subsidence will occur near the extraction hole of removed pile, especially at the lower part of the clay layer near the hole. The greater the number of extraction holes of removed piles, the greater the compressive stress acting on the extraction holes after the pile removal. Therefore, the filler should exhibit strength early as the number of extraction holes of removed piles increases.

IMPACTS OF COVID-19 ON THE AZERBAIJAN ECONOMY

As we know, the strategic roadmaps and plans developed for the main sectors of the economy will ensure sustainable economic development in the country, the competitiveness of the economy, inclusion and further increase of social welfare. Responding to global challenges, Azerbaijan will strengthen its position in the world economy as a result of attracting investment, a free competitive environment, access to markets and the development of human capital. Over the past 10 years, the Azerbaijani economy has entered a qualitatively new stage as one of the countries with the highest economic growth rates in the world. However, as a result of the COVID-19 pandemic, which began to spread rapidly in the world in 2019, not only Azerbaijan, but also many countries around the world were strongly affected, both economically and socially, and there were some setbacks in the economy. The economic crisis caused by the COVID-19 pandemic is much greater than the economic crises and disasters that have taken place in the last 40 years. It is estimated that the global crisis will be caused by the pandemic will be much deeper and more permanent than previous global crisis. The world economy shrank by 3.75% in 2020, which is nearly twice the contraction in the global financial crisis. In my article, it will discuss the formation of the Azerbaijani economy, the impact of the global pandemic on the country's economy, the measures taken by enterprises during the COVID-19 pandemic and the advantages and disadvantages of these measures. Keywords: economy, COVID-19 pandemic, accounting policy

Declining industries in emerging economies and firms’ strategies

PurposeInternational business (IB) and strategy research in the context of emerging economies (EEs) has focused traditionally on the strategies of firms in and from those markets to seize opportunities arising from their economic growth. This paper aims to demonstrate that declining industries in EEs are an important but overlooked research context for critical IB scholarship and to illuminate special considerations for strategising under those conditions.Design/methodology/approachThis paper provides an overview of declining industries in EEs and includes an illustration of a sample of such industries in major EEs. This paper then critically reviews research on firms’ strategies in declining industries and extends that critical discussion to the EE context.FindingsFirstly, this paper provides evidence relating to declines in industries in EEs. Secondly, this paper identifies three major strategies that firms use in response to an industry decline and critically discusses those strategies’ manifestations and special considerations in the context of EEs.Social implicationsIndustry decline in EEs and the resultant responses of multi-national enterprises and local firms, such as business exit, market competition and firm diversification strategies, cause significant social challenges. This paper calls for further research on the phenomenon, especially regarding its distinctive ramifications compared with those in the context of developed countries.Originality/valueThis paper contributes to the critical IB scholarship by questioning the assumptions around high economic growth in individual EE industries and by challenging a universalistic approach that applies findings grounded in declining industries in developed countries to the distinctive context of EEs. This paper also provides forward-looking expositions concerning industry decline in EEs.

Sectoral Linkages of Output and Employment; Reflections on the Indian Economy

Economic development is defined as a sustained increase in output per capita, as well as structural changes in productive capacity and employment. A major aspect of current growth is a shift in labour from agricultural to non-agricultural output. As a result of structural transformation, which is pulling labour away from agriculture and into non-agricultural sectors at a rate determined by the labour absorbing intensity of the industrial and service sectors, the rate of employment growth is rapidly increasing. India's employment growth in agriculture and industry has slowed in a high-growth economy. The present paper tried to analyze the sectoral changes in employment across the broad economic sectors in the Indian economy during the pot-reform period. The study is based on the secondary data collected from the World Development Indicators from 1991 to 2020. Proportionate analysis and polynomial regression function were used to identify the nature and growth of sectoral employment in the Indian economy. In this study, a comparison of growth of income, employment and labour productivity will be made to assess the nature of sectoral changes in the Indian economy

“Economic Recovery from Coronavirus Pandemic Crisis: Suggestion Macroeconomic Policies in Knowledge Economic Era to Re-Rise Growth in USA, UK, and Egypt”

This paper aim to suggest the best macroeconomic policy to maintenance economic recovery in USA, UK, and Egypt with and after coronavirus pandemic period, and achieving high economic growth in this three countries as it was before the pandemic and better. So it suggested deferent policies according to the differences among the three countries, with respecting to the statues of USA, and UK as advanced countries, and Egypt as a developing country. We used theoretical and quantitative analysis with getting experience from exiting of the previous recessions, and re-visiting to Taylor principle and rule especially in using interest rate in both short-run and long-run. So we assure on the importance of technological changes through innovation and R&D to keep on autonomous growth in advanced countries in longrun as well as in Egypt, and increasing nominal federal funds rate to 0.7% to reach real federal interest rate in U.S.A to 1.35% in the short-run, rising real interest rate by 0.2% in UK, to become 2.2% or suppose the autonomous component of the real interest rate ( ṝ = 1.2) in short-run in UK, and reducing nominal interest rate in Egypt to 10.3% in short-run. This will lead to achieve the goals of the study and maintenance on economic recovery and rising growth of GDP in USA, UK, and Egypt.

On the economic growth equilibria during the Covid-19 pandemic

The aim of this paper is to study the effects of the Covid-19 pandemic suppression policies (i.e. containment measures or lockdowns) on labor supply, capital accumulation, and so the economic growth. We merge an epidemic SIS population model and a Solow’s type growth model, i.e. we propose a fusion between economics and epidemiology. We show the creation and the destruction of economic growth equilibria driven by the suppression policies and by the severity of the disease. The dynamic stability properties of the equilibria are mainly determined by (i) the stringency of the suppression policies, (ii) the proportion of infected workers, (iii) the recovery rate of workers, and (iv) the economy’s saving rate. Thus, economies can fall into the stable equilibrium of the poverty trap if the propensity to save is low and the economic policies that reduce the spread of infection are severe enough with high levels of infection and low rates of illness recovery. Otherwise, with high savings rates and if the suppression policies perform in such a way that infection levels are low and recovery rates are high, then the economies converge towards the equilibrium of high economic growth with capital accumulation. The scenario is rather complex since there is a multiplicity of equilibria such that economies can be in one scenario or another, characterized by stability or (structural) instability, i.e. bifurcation paths. Numerical simulations corroborate our results.

Climate change and modernization drive structural realignments in European grain production.

Charting the long-term trends in European wheat and maize yields and harvested areas and the relation of yields to climatic and economic drivers, two profound spatial processes become apparent. One consequence of the relatively late modernization of Eastern Europe has been to shift the focus of grain production from West to East. The warming trend prevailing over the past decades in the summer and winter seasons has been accompanied by a South to North shift in the harvested areas. The combination of these two processes has meant that the north-eastern sector of the European grain chessboard has emerged as the main beneficiary. There, the relatively low sensitivity of cereals to climatic change plus high economic growth rates have been accompanied by the most dynamic increases in cereal yields on the continent. As a result, a modern version of the 3000 year-old grain distribution system of the Ancient World is being restored before our eyes. One noteworthy finding is that increasing January–March temperatures have had a significant positive impact on wheat yields from Northern to South-Eastern Europe, and this is, at least in part, compensating for the negative impact of summer warming.

Investigation Of The Impact Of Exchange Rates, Interest Rates, Economic Growth, And Circulation Of Electronic Money On Inflation In Malaysia

This project intends to research the effects of the USD vs Malaysian Ringgit exchange rate, Malaysia's central bank interest rate, The growth of the economic in malaysia, the circulation for electronic money in Malaysia on inflation in Malaysia. Bank Negara Malaysia is a secondary data source for this investigation, global financial institution (IMF), also the World Bank with a monthly research period from January 2012 to January 2020. We use Model for Error Correction (ECM) model for the investigate some influence relationship at the long and short run.We found that a stronger USD further depresses the Malaysian ringgit and has an impact on increasing Malaysia’s inflation on the long and short run. When the Malaysian central bank interest rate are higher, the more it will push Malaysia’s inflation. And the higher economic growth in Malaysia, the more accelerating inflation at Malaysia, at long and the short run. However, some circulation of electronic money in Malaysia only has a short-term impact on inflation and in the long term the impact is not significant.

Influence of distribution of zakat, Infaq And Shadaqah (ZIS), inflation and human capital on economic growth in Indonesia 2002-2021

Economic growth is one of the standards used to be able to see the success of economic development in a country. Indonesia, as a developing country, is actively carrying out development in a planned and gradual manner, without neglecting efforts for equity and stability. National development seeks to achieve high economic growth. Which in the end allows the realization of an increase in the standard of living and welfare of all people. In other words, a country that experiences high economic growth will be able to have a high effect on other fields, because when a country experiences economic growth, the national income of a country will be boosted up so that it can be allocated for financing economic infrastructure development. This study aims to determine the effect of zakat, infaq and shadaqah (ZIS), inflation and human capital on economic growth. This study uses time series data through data obtained at BPS from 2002-2021 as many as 20 samples with multiple linear regression method with SPSS. The results show that simultaneously zakat, infaq and shadaqah (ZIS), inflation and human capital have an effect on economic growth. Partially zakat, infaq and shadaqah (ZIS) and human capital have an effect on economic growth. Meanwhile, inflation has no effect on economic growth.

Review of Spatial Transformations in Indian Cities Post Economic Reforms 1991

Spatial transformation of settlements is a continuous process. City planning governs land utilization, and policies adopted by government authorities result into changes happening in cities. Also, cities are drivers of economic growth and countries must invest in cities to attain higher economic growth. From 1991, post adoption of economic reforms, an emerging socio-economic and cultural structure has been observed which has driven changes into city fabric and evolved a new physical form of human habitation. Along with significant economic growth, phenomenon of disparity resulted in uneven geographic development. This research explores influence of economic reforms adopted in 1991 on evolving spatial changes in Indian cities. Research findings suggest that spatial transformations in Indian cities is a resultant of reform led investment, demanding new set of spatial requirements complimenting current pattern of growth. Cities contributed in achieving economic growth, but failed to cater holistic progress of all sections of society.

Inclusive Growth: A Poverty Approach

The concept of inclusive growth (IG) was present in the last decade and together with the concept of pro-poor growth. Characteristic of the concept of inclusive growth is the active participation and contribution of the community in the development process. Several approaches have been developed in measuring inclusive growth. This study aims to measure inclusive growth using the provincial poverty approach (IGp) on the island of Sumatra for the period 2001-2016. The method of approach used in this study is descriptive analysis. The technique of collecting data uses library research. Poverty-Equivalent Growth Rate (PEGR) was developed in the measurement of inclusive growth. The results showed that the provincial economic growth on the island of Sumatra in general was not inclusive. The inclusive growth coefficient (IGp) in most provinces is positive but lower than the economic growth coefficient (Gg). The average IGp coefficient of Sumatra island is 0.032 lower than the Gg coefficient of 0.049. The performance of economic growth determines the value of the coefficient of economic growth and the coefficient of inclusive growth. However, the high economic growth of a region does not guarantee the realization of an inclusive growth. Quality economic growth is not only based on high economic growth achievements but the ability of economic growth to reduce poverty. Policies related to improving development and poverty alleviation programs need to be carried out in an integrated and synergic. manner between ministries or institutions from national to regional levels

Can We Increase Health Expenditure Per Capita Through Higher Economic Growth? Empirical Evidence from Turkey

Many researchers indicate that health expenditures positively contribute to economic growth and prosperity, emphasizing that when healthy individuals are more efficient, they make a huge contribution to human capital, which in turn improves productivity. There is also a relationship between economic growth and health expenditures, meaning that health expenditure is a function of income and higher income leads to an increase in spending on health. In this study, we assess whether economic growth has an impact on healthcare expenditure by focusing on an emerging market economy. Therefore, the main objective of this paper is to test the impact of economic performance on health expenditure per capita for Turkey in the period of 1999-2018. In the analysis, the unit root properties are tested by using RALS (Residual Augmented Least Squares) ADF and traditional Augmented Dickey Fuller (ADF) unit root tests. In order to examine the long-run relationship between economic growth and health expenditure per capita, we employ the RALS Engle-Granger and traditional Engle-Granger cointegration tests. The findings of our analysis support the evidence of a long-run impact of economic growth on healthcare expenditure per capita for Turkey in the relevant period.

Alternative legacies of authoritarianism: Pro-dictator bias in ideology

How does an authoritarian past shape voters’ left-right orientation? Recent studies investigate “anti-dictator bias” in political ideology, where citizens in a former right-wing (left-wing) dictatorship may display a leftist (rightist) bias in their ideological self-identification. In this paper, I provide evidence for a “pro-dictator bias” where citizens hold ideological positions close to those of the dictator, depending on their experiences prior to transition. In countries with high economic growth under dictatorship and without violent ruling party ouster, authoritarian successors could continue mobilizing the popular base and invoke positive sentiment on the past in democratic elections. Such positive sentiment can facilitate individual ideological orientation close to the ideological label of the former dictatorship. I test this hypothesis by combining individual- and country-level data covering 1985 to 2018 from 48 countries. I demonstrate that voters in countries with high economic growth during dictatorship and without violent party exit are more likely to have pro-dictator bias in ideology. I further show that voters in former developmental states show pro-dictator bias from the history of economic growth and more peaceful transition. The findings emphasize the role of pre-transition features in shaping alternative legacies on voter attitudes in post-authoritarian societies.

The Granger Causality Between Corruption and Economic Growth in ASEAN Countries

This paper studies the Granger causality between corruption and economic growth in ASEAN countries over the period of 1995-2019. Ten ASEAN countries are Brunei Darussalam, Cambodia, Indonesia, Lao People's Democratic Republic, Malaysia, Myanmar, Philippines, Thailand, Vietnam, and Singapore. The corruption is measured by the Corruption Perception Index published annually by Transparency International. The economic growth is measured by a country’s annual gross domestic product growth rate. There is a significant bidirectional Granger causality found between lower level of corruption and higher economic growth in Indonesia. It is shown that higher economic growth Granger causes lower level of corruption in Brunei Darussalam, and lower level of corruption Granger causes higher economic growth in Cambodia. No Granger causality between corruption and economic growth is found in the remaining seven ASEAN countries.

Understanding the Impact of Land Supply Structure on Low Consumption: Empirical Evidence from China

In studies of low consumption in China, there is a lack of consideration of land policy, which may be an important factor contributing to the industrial structure, thus impacting consumption. This paper explores the relationship between local governments’ distorted land supply strategies and final consumption and its mechanism of action based on panel data for 31 provinces in China from 2002 to 2017, using a fixed-effects panel model and a mediating-effects model. The results show that (1) the ratio of industrial land supply area to the land supply area of commercial and residential significantly suppresses the final consumption rate, and the results remain significant after robustness tests; (2) the effect of land supply structure on final consumption is related to the development strategy adopted by local governments and the urban–rural inequity, thus showing heterogeneity, with regions with high economic growth and large urban–rural income gaps further contributing to the suppression of consumption rates; (3) the intermediation effect suggests that the structure of land supply affects consumption through the industrial structure. As land supply favors the development of industrial enterprises, it increases the ratio of gross capital formation to GDP and can have a crowding-out effect on the income of the household sector, thus reducing the rate of final consumption. Under the Chinese decentralization system, in order to achieve regional economic development, local governments intervene in the allocation of land resources among different industries through differentiated land supply strategies, resulting in an industrial structure dominated by the secondary industry, which has an important impact on consumption. Therefore, the reform of the land supply structure should be accelerated to restrain the excessive intervention of local governments in the land supply structure and promote the transformation of the economic development model to enhance consumption.

Impact of Macroeconomic Variables on Foreign Direct Investments in Nigeria

This study examines the impact of macroeconomic variables on foreign direct investment in Nigeria from the period of 1985-2020. Autoregressive Distributed Lag (ARDL) and Granger causality tests were employed. The result from ARDL shows that foreign direct investments are majorly determined by the real gross domestic product, exchange rate, interest rate and degree of openness. The Granger causality test indicates evidence of unidirectional causation which flows from exchange rate, inflation rate and degree of openness to foreign direct investment while no evidence of causality was found among other variables. Based on this, the study recommends that policymakers should put in high esteem economic growth and development in the country and this should be corroborated by a consistent exchange rate to increase investors’ confidence through a healthy and secured exchange rate management. Interest rate fluctuation should be curtailed by the monetary policy. Keywords: Foreign Direct Investments, Exchange Rate, Inflation Rate, Degree of Openness DOI: 10.7176/JESD/13-8-03 Publication date: April 30 th 2022

High Technology Trade, Innovation and Economic Growth: Evidence from Aggregate and Disaggregate Trade Products

High Technology Trade, Innovation and Economic Growth: Evidence from Aggregate and Disaggregate Trade Products

Impact of Public Expenditures on the Dynamics of Economic Development of the Republic of Bulgaria

Introduction. Regardless of the degree of government intervention in the economy, government spending is huge and often dominant in fiscal policy. Given the fact that costs are the main tool for fulfilling the economic and social functions of the state, adequate measures are needed to maximize their provision. The main goal of economic policy in Bulgaria is to ensure high economic growth in order to reach the average levels of Gross Domestic Product (GDP) per capita in the EU, therefore it is requires to identify all instruments that can affect the level of aggregate production.
 Aim and tasks. The purpose of this study is to analyze the main factors influencing the effectiveness of government spending on the basis of in-depth analysis and guidance on the implementation of public spending in the Republic of Bulgaria. The following main tasks have been set for the realization of the stated goal: disclosure of the essence and content, through theoretical statements about gross domestic product and government spending; carrying out an analysis of gross domestic product for the period 2010-2020; carrying out an analysis of government expenditures for the period 2010-2020; establishing a link between development of gross domestic product and government spending for the period 2010-2020.
 Results. Public spending has the potential to play the role of a kind of public lever for reducing the risks of poverty and social exclusion only when it is focused on the real causes of the problem and reaches the ultimate beneficiaries of the system. In 2020, compared to 2010, the gross domestic product increased by a little over BGN 46 million or by 63.8%. The effect of the crisis was reflected in the main macroeconomic aggregates, with a negative rate of -0.4 compared to 2019. In 2020, compared to 2010, government spending increased by just over BGN 20 million or 76.4%. 
 Conclusions. During the considered period 2010-2020, there is a continuous economic growth both compared to the base year and compared to each subsequent year. For the entire period of the study, the pace of development of government expenditures outpaces the pace of GDP development. For the period 2010-2020 consolidated expenditures form a real share of redistribution through public finances in the ratio of about 35-40 percent of gross domestic product.

Nexus between Technological Innovation, Renewable Energy, and Human Capital on the Environmental Sustainability in Emerging Asian Economies: A Panel Quantile Regression Approach

The goal of this study was to examine the interlinkage of renewable energy, technology innovation, human capital, and governance on environment quality by using a panel quantile regression in Asian emerging economies over the period of 1990–2019. The results indicated that higher economic growth, population density, technological innovation in renewable energy, and exploitation of natural resources have significantly raised CO2 emissions in emerging Asia. Furthermore, larger capital, more use of renewable energy, green technology, and human capital development can improve environmental sustainability in Asia. As for governances, proxied by corruption rates, no evidence indicated that it has resulted in more damage, unlike earlier studies have suggested. The findings indicated that the three channels exposed in the Kuznets hypothesis can serve as a reference for proposals for environmental policies (scale of consumption, energy composition, and choice of technologies). There are opportunities to reduce CO2 emissions through investments in human development, investing in new technologies to increase efficiency in energy (generation and consumption), increasing working capital (GCF), and migrating to more environmentally friendly energy. The negative link between carbon dioxide emissions and economic growth, increases in population density, and exploitation of natural resources can compromise the achievement of sustainable environmental goals.