Increase In Gross Domestic Product Research Articles

Assessing the influence of foreign direct investment on renewable energy consumption in Somalia: an ARDL model analysis

ABSTRACT This study examines the impact of Foreign Direct Investment (FDI) on renewable energy consumption in Somalia from 1990 to 2019 using the Autoregressive Distributed Lag (ARDL) model. The findings reveal a positive, statistically significant relationship between FDI, Gross Domestic Product (GDP), trade openness, and renewable energy consumption in the long run. Specifically, a 1% increase in FDI leads to a 0.0000115% increase in renewable energy consumption. Similarly, a 1% increase in GDP leads to a 0.026041% increase in renewable energy consumption. Meanwhile, a 1% rise in trade openness enhances renewable energy consumption by 0.0000280%. Increased foreign investments and economic growth promote the adoption of renewable energy, aligning with sustainable development principles. Conversely, environmental degradation negatively impacts renewable energy consumption. Specifically, a 1% increase in environmental degradation leads to a 0.570376% decrease in renewable energy consumption. Policymakers should incentivize FDI in the renewable energy industry through tax incentives, streamlined regulations, and public-private partnerships. Strategies promoting economic growth and integrating renewable energy objectives are essential, with trade openness facilitating the importation of renewable energy technologies. A limitation of this study is the reliance on yearly data, which may not capture recent developments or short-term fluctuations. Future research should use more granular, up-to-date data to understand the dynamics in Somalia better.

Factors Affecting Export Demand for Malaysian Palm-Based Finished Products

The encouraging growth in volume and exports of palm-based finished products (PBFP) was directly related to an increase in their demand. It is thus important to investigate the factors influencing such demand. Our study attempts to elucidate this for the Malaysian PBFP in 10 major foreign markets, namely, Turkey, China, Iraq, Iran, Singapore, Romania, Australia, Pakistan, Russia, and Saudi Arabia. This study constitutes a panel data analysis for the 10 countries using data from 2007 to 2021 using the fully modified ordinary least squares (FMOLS) method. Pedroni and Westerlund cointegration test indicates the presence of a long-term relationship between the variables under study. The empirical results show that gross domestic product (GDP) has a long-term positive influence on the demand for PBFP, with every 1% increase in GDP will increase the demand for palm oil by 0.9%. In addition, population size (POP) also shows a positive sign and is statistically significant at the 1% level, indicating that a 1% increase in POP will lead to a 0.3% increase in PBFP demand. Substitute oil price also has a long-run positive influence where for every 1% increase in the price of both commodities will increase the demand for PBFP by 0.1%. Meanwhile the price of PBFP has a long-term positive influence on its demand. Thus, information regarding the factors influencing the demand for PBFP from our findings may help industry player and policymakers in formulating strategies to improve the markets, and academicians may also benefit from sharing the knowledge gained from the study.

Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria

This study examines the impact of renewable energy consumption and electricity tariff on the economy of Nigeria. The study considers the casual relationship and vector decomposition between various renewable energy sources (solar, hydro and biomass), electricity price and Gross domestic product (GDP) using an unrestricted vector error correction model (VECM). In addition, other robust econometric techniques were applied to the time series of GDP, electricity price and energy consumption from renewable energy sources from 1980 to 2021. The findings indicated a 1% increase in biomass consumption causes increase in GDP by 0.14% in the long-run. Mixed result in the short-run with the difference in the log value of the current lag of solar and bio electricity consumption having positive impact on GDP. The coefficient of the Error Correction Model (ECM) was negative (-0.49) and statistically significant indicating that short-run change from the long-run equilibrium is corrected by 49% annually. Unidirectional causality from GDP to solar electricity consumption. Solar, hydro, biomass and electricity price explain 1.4%, 0.4% 2.2% & 12% respectively of fluctuations in GDP in the long-run. The study results demonstrates that regulations need to be put in place to control the adverse effect of consuming biomass on the environment which could cause mixed impact on gross domestic product in the short run whereas, policies to foster development of solar projects could impact positively on GDP and alleviate the electricity supply deficiency in Nigeria.

HOLT WINTERS EXPONENTIAL SMOOTHING UNTUK MERAMALKAN PRODUK DOMESTIK BRUTO DI INDONESIA

A country's economic growth will be seen as having grown better or worse than in the past by measuring based on the increase in Gross Domestic Product (GDP). The pattern of Indonesian GDP from 2010 to 2022 shows that the data increases from year to year and there are seasonal fluctuations in the quarter. Holt Winters method is part of the Exponential Smoothing method used for forecasting if the data shows a trend and seasonality in the data pattern. The Holt Winters method has two models, namely additive and multiplicative. Holt Winters Additive is used if the data shows trends and seasonal patterns remain constant. Multiplicative Holt Winter is used if the data shows trends and seasonal patterns proportional to the average rate of the seasonal time series. The data used in this study are GDP Based on Current Prices (Nominal GDP) and GDP on the Basis of Constant Prices (Real GDP). Based on the evaluation of model performance using test data forecasting, the Holt Winters Multiplicative model of Nominal GDP with a MAPE value of 4,767535% is the best model because it has an accuracy value of <10%. While the Holt Winters Additive model of Real GDP with a MAPE value of 4,42387% is also the best model because it has an accuracy value of <10%.

Unveiling the causal nexus between Saudi’s seaborne trade and economy: evidence from an ARDL model

An economy’s primary objective is to foster high economic growth, ultimately enhancing the well-being of its citizens. Recent economic strategies have increasingly emphasized trade-oriented policies to achieve this goal. This study delves into the nexus between Saudi seaborne trade (measured in tons) and gross domestic product (GDP), aiming to determine any causal relationship between these economic variables. Using datasets from the Saudi Central Bank and the General Authority of Statistics, this research employs rigorous unit root, cointegration, and causality tests to find the intricate interplay between trade and economic growth in Saudi Arabia. The empirical analysis highlights a robust long-term relationship between Saudi GDP and seaborne trade, suggesting cointegration. Specifically, the findings reveal a significant impact of economic growth on seaborne trade, as indicated by a trade elasticity of 1.08, which implies that changes in GDP yield a substantial shift in trade. For instance, a 1% increase in GDP corresponds to an approximate 1.08% increase in trade volume. The error correction mechanism also illustrates the dynamic adjustment process: deviations of Saudi seaborne trade and economic growth from equilibrium are corrected by 61% and 43%, in the subsequent year. Furthermore, Granger causality tests unveil bidirectional causality between GDP and trade, elucidating that economic growth changes precede trade volume alterations and vice versa. Thus, fostering international trade not only stimulates income but also bolsters the domestic economy of Saudi Arabia.

Impact of urbanization, economic growth, FDI, and trade openness on energy demand in Ireland: An ARDL approach

Abstract This research study uses an autoregressive distributed lag (ARDL) paradigm to examine the effects of trade openness, urbanization, economic growth, and foreign direct investment (FDI) on energy demand in Ireland. This thorough theoretical framework anticipates a relationship between energy demand and trade, foreign direct investment, and urbanization. This study demonstrates both short- and long-run cointegration among the variables employing an ARDL (autoregressive distributed lag) bounds-testing method for the data set period from 1972 to 2021. Additionally, Fully Modified Ordinary Least Square (FMOLS), Dynamic Ordinary Least Square (DOLS), and Canonical Cointegrating Regression (CCR) were utilized in the study to verify the results' robustness. Nonetheless, this analysis discovers that trade openness and rising GDP (Gross Domestic Product) per capita increase energy consumption. The results show that for every 1% increase in GDP, energy consumption increases by 0.967%. On the flip side, energy consumption in Ireland is declining due to increased urbanization and foreign direct investment. The results show that for every 1% increase in urbanization, energy usage decreases by 1.738%. The investigation shows that Ireland's energy usage is strongly impacted by trade liberalization, FDI, urbanization, and economic expansion. Findings like these can help policymakers and stakeholders manage and optimize energy usage in the context of urbanization, economic expansion, foreign direct investment, and global trade. The report recommends sustainable energy planning and policy initiatives to strike a healthy balance between meeting the increasing demand for energy and protecting the environment.

Oil prices and the renewable energy transition: Empirical evidence from China

This paper explores the effect of oil price, gross domestic product (GDP), and carbon dioxide (CO2) emissions on renewable energy consumption in China from 1990 to 2020, utilizing the canonical cointegrating regression (CCR) method. The findings indicate that the oil price, GDP and CO2 emissions positively and significantly affect renewable energy consumption over the examined time frame. Numerically, a 1% increase in oil prices, GDP, and CO2 emissions results in a 0.16%, 0.39%, and 1.70% increase in renewable energy consumption, respectively. The positive effect of oil prices on renewable energy consumption can be seen as the cost advantage of renewable energy, which may grow with rising oil prices, leading to a rise in its adoption. The study underscores the significance of promoting renewable energy usage, emphasizing the need for policies that aid energy security and environmental sustainability.

Economy-wide impact of a reduction in tobacco use in India

BackgroundPublic policy measures aimed at regulating tobacco use should consider the net gains for the nation, as the tobacco sector contributes to employment and tax revenue while also imposing substantial...

A model of endogenous education quality: the role of teachers

Abstract Over the last 40 years, the massive increase in average years of schooling in developing countries was not accompanied by a similar increase in Gross Domestic Product (GDP) per capita. We investigate this apparent disconnect between education and growth by focusing on the role of education quality. We propose an overlapping generations model which features an endogenous tradeoff between quantity and quality of education. A policy that increases average years of schooling then has an ambiguous effect on long-run human capital and GDP per capita. We also consider a quantitative version of the model to understand the Latin American experience between 1970 and 2010.

Factors affecting foreign direct investment in ASEAN

This study examines the changes in trade openness, gross domestic product (GDP), and foreign direct investment (FDI) in ASEAN from 1999-2022, analyzing how trade openness and GDP impact FDI. Using geographic data and descriptive statistics, the study employs the Panel Fully Modified Least Squares (FMOLS) method. The analysis reveals that since 1999, trade openness in ASEAN has generally increased, driven by trade liberalization, international trade agreements, and infrastructure development. However, there have been occasional declines due to specific events. GDP has also consistently risen due to increased FDI, trade openness, and infrastructure improvements, transitioning the ASEAN economies from agriculture to manufacturing and services, leading to more global exports. FDI has shown continuous growth, supported by trade openness and infrastructure development, which have enhanced the region's attractiveness for investment. The study finds a positive relationship between trade openness, GDP, and FDI in ASEAN. A 1% increase in GDP leads to a 5.27% rise in FDI at a 1% significance level, while a 1% increase in trade openness results in a 2.62% increase in FDI at a 5% significance level.

Energy transition strategies in the Gulf Cooperation Council countries

During the last two decades, Gulf Cooperation Council (GCC) countries have seen their population, economies and energy production growing steeply with a substantial increase in Gross Domestic Product. As a result of this growth, GCC consumption-based carbon dioxide (CO2) emissions increased from 540.79 Metric tons of CO2 equivalent (MtCO2) in 2003 to 1090.93 MtCO2 in 2020. The assumptions and strategies that have driven energy production in the past are now being recast to achieve a more sustainable economic development. The aim of this study is to review and analyze ongoing energy transition strategies that characterize this change to identify challenges and opportunities for bolstering the effectiveness of current strategic orientations. The ensuing analysis shows that since COP26, GCC countries have been pursuing a transition away from carbon-based energy policies largely characterized by the adoption of solar PV with other emerging technologies including energy storage, carbon capture, and hydrogen generation and storage. While as of 2022 renewable energy adoption in the GCC only represented 0.15 % of global installed capacity, GCC countries are making strong efforts to achieve their declared 2030 energy targets that average about 26 % with peaks of 50 % in Saudi Arabia and 30 % in the UAE and Oman. With reference to solar energy, plans are afoot to add 42.1 GW of solar photovoltaics and concentrated solar power which will increase 8-fold the current installed renewable capacity (5.1 GW). At the same time, oil and gas production rates remain stable and fossil fuel subsidies have grown in the last few years. Also, there is a marked preference for the deployment of CCUS and utility-scale solar energy technology vs. distributed solar energy, energy efficiency and nature-based solutions. The pursuit of energy transition in the GCC will require increased efforts in the latter and other overlooked strategic endeavors to achieve a more balanced portfolio of sustainable energy solutions, with stronger emphasis on energy efficiency (as long as rebound effects are mitigated) and nature-based solutions. Increased efforts are also needed in promoting governance practices aimed to institutionalize regulatory frameworks, incentives, and cooperation activities that promote the reduction of fossil fuel subsidies and the transition away from fossil fuels.

Economic growth and foreign direct investment in Balkans

Foreign direct investment (FDI) has become a key source of economic growth for the Balkan countries, offering vital funding for development initiatives. Therefore, the purpose of this study was to examine the dynamics of FDI in Serbia, North Macedonia and Montenegro from 2000 to 2023. An econometric model was used to conduct the research, namely, the relationship between FDI and economic growth in the region was analysed. A multiple regression model was developed that includes gross domestic product growth as the dependent variable. It was established that significant fluctuations in the rates of economic growth are characteristic of all three countries during this period. Serbia has shown particular resilience, with positive growth rates prevailing in most years. Key sectors attracting FDI were also identified, including services, manufacturing, automotive, IT, agriculture, energy and tourism. The obtained results emphasised the importance of reforms aimed at business development, infrastructure development and regional integration, especially with the EU, as critical factors in attracting FDI. In addition, diversification of FDI sources was emphasised with increased investments from China, Turkey and the United Arab Emirates, which complement traditional investors from the EU. More than 60% of foreign investment in Serbia has been found to be concentrated in the services sector, while North Macedonia has successfully attracted investment in high value-added industries such as information technology and engineering. These findings are consistent with established economic theories about the impact of FDI on growth, while providing specific insights into the Balkan context. It found that a 1% increase in FDI was associated with a 0.3-0.5% increase in gross domestic product in the Balkan countries studied. The obtained results can become the basis for future political decisions and investment strategies in the region

Specific Effect of Innovation Factors on Socioeconomic Development of Countries in View of the Global Crisis

Although the coronavirus pandemic has now faded into the background, the global crisis caused by COVID-19 has had the most devastating impacts worldwide. Given the potential relapse of such unexpected and uncertain events, it is vital to specify the patterns thereof and develop proactive measures for the countries to acquire an advanced readiness to deal with the related incidents. The most infected countries faced an increase in business bankruptcies, unemployment and inflation rates, low production volumes, and a decline in Gross Domestic Product (GDP). To withstand such socioeconomic consequences, the countries had to employ a number of measures, with innovation development acceleration being one. This paper aims to assess the dependency of an increase in GDP and a decrease in inflation and unemployment rates on the country-level growth of innovation development according to such Global Innovation Index (GII) pillars as institutions, human capital and research, infrastructure, market sophistication, business sophistication, knowledge and technology outputs, and creative outputs. The conducted research analysis covered the period from 2019 to 2022 based on the data for the GII pillar development level and economic performance indicators for 20 countries from five socioeconomic models. Descriptive and comparative statistics as well as correlation and regression analysis were used to prove the innovation development to be a key driver in increasing GDP and reducing inflation. To increase the GDP value, special attention should be paid to such GII pillars as institutions and human capital and research, while infrastructure and human capital and research are the pillars to reduce the inflation rates.

Implikasi Laju Inflasi Terhadap Gross Domestic Product (GDP) Berdasarkan Perspektif Ekonomi Islam

This journal discusses the influence of the inflation rate on Gross Domestic Product (GDP) based on an Islamic Economics perspective. So it can be understood that the size of the inflation rate in a country will greatly influence the level of GDP. Where inflation has a simultaneous influence on GDP, and inflation has a partial negative impact on GDP. The writing of this journal uses a deductive qualitative approach (from general to specific), examining relevant general phenomena, then producing specific studies and conclusions on matters that are the object of research, using a normative juridical approach with literature study. A country's economic growth can be represented through an increase in the country's GDP, apart from income factors in terms of consumption, investment, government spending and net exports. GDP is greatly influenced by the inflation factor. Inflation in the view of Islamic economists is an economic indication that occurs at a macro level in almost every country related to the decline in the exchange rate of money for goods and services, whether it occurs naturally (natural inflation) or is caused by human error (Human Error Inflation). Inflation does not only occur naturally, it can be caused by the pull of Aggregate demand (Aggregate demand) or due to a decrease in Aggregate supply (Aggregate Supply), but also occurs due to human error in regulating state administration and law enforcement, giving rise to a country's economic interconnectedness. Maintaining the stability of a country's economy by controlling the rate of inflation is something very basic, where inflation significantly affects Gross Domestic Product. GDP is an important indicator of economic growth in measuring economic activity, especially the volume of production in a country in one year.

Geopolitical risk and tourism in Turkey

PurposeThe purpose of this paper is to show the effect of Turkey's geopolitical risk on the number of international tourist arrivals to the country. When Turkish economy in 2019 is analyzed, it is seen that the share of tourism in national income is 11%. For this reason, national economy is significantly affected by changing of the number of international tourist arrivals. Security problems are an important variable affecting tourist arrivals.Design/methodology/approachThe paper focused on secondary data for the period 2000–2019 for macroeconomic variables. Accordingly, the number of international tourist arrivals was added as a dependent variable, geopolitical risk as an independent variable, gross domestic product (GDP) and economic freedom index as control variables and inflations as an external variable to the model. The residual augmented least squares–the autoregressive distributive lag (RALS-ADL) cointegration test and the dynamic ordinary least squares (DOLS) coefficient estimator were used. It allows for more robust results to be obtained when the residues do not have a normal distribution.FindingsThe RALS-ADL cointegration test result shows that there is a cointegration relationship between variables at a 1% significance level. Moreover, the DOLS coefficient estimator results indicate that an increase in economic freedom and GDP increase the number of international tourists, whereas an increase in the Geopolitical Risk Index and inflation decreases the number of international tourism arrival. It can be said that tourists consider the security and economic stability of the host country when making tourism decisions.Originality/valueTurkey is one of the most risky developing countries, as well as one of the most popular travel destinations. When the literature is examined, it has been found that studies for Turkey usually determine the relationship between the variables for a short period of time. However, to ensure sustainable growth and environment of confidence, the long-run relationship between variables should be determined so that policymakers can make more impactful decisions. Therefore, the aim of this study is to make a literature contribution, taking into account the long-term effects. In addition, unlike other studies, this study fills the gap in literature using the RALS-ADL cointegration test, which produces robust estimators.

Infrastructure and economic growth in ECOWAS member states: The Westerlund co-integration approach

This research explores the impact of infrastructure on member states' economic growth in the Economic Community of West African States (ECOWAS). Utilizing panel secondary data sourced from the World Bank Development Indicators (WDI) and the African Infrastructure Development Index (AIDI) across all fifteen ECOWAS Member States over eighteen years, the study employs the panel Non-linear Autoregressive Distributed Lag (NARDL) model and the Westerlund co-integration test for analysis. The findings reveal that investments in infrastructure, improvements in the African Development Index, and enhancements in the Electricity Composite Index significantly contribute to the economic growth of ECOWAS countries. Specifically, infrastructure investment is associated with a 0.01 per cent increase in the Gross Domestic Product (GDP) of the ECOWAS countries studied. In comparison, the African Development Index and the Electricity Composite Index are linked to increases in GDP by 0.292 per cent and 0.987 per cent, respectively, in the long term. Based on these outcomes, the study recommends that ECOWAS country authorities enhance policies to optimize government spending on infrastructure quality. Furthermore, adopting quality-enhancing and efficiency-driven financing policies in infrastructure is advocated to complement ECOWAS's ongoing infrastructural development efforts. The realization of these recommendations hinges on the availability of accurate data for informing decisions and guiding policymakers. Hence, the study underscores the need for the ECOWAS Commission to bolster its capacity for collecting reliable data on infrastructure variables and other indicators. It also proposes that future research should focus on promoting sub-regional peer-review mechanisms for infrastructure indicators among member states and establishing structures to fortify infrastructure in West Africa.

Impact of Agriculture Growth on Poverty Reduction: A Case of Karnataka, India

Karnataka is one of the progressive states in the country even though it experiences the challenges of poverty and it has wide variation, depending on rural-urban disparities, region, caste, and religion. Agriculture as primary sector contribute notably to the country’s Gross Domestic Product (GDP) and being main occupation for majority population acts as largest source of livelihood for the rural poor by creating enormous employment opportunities thus by increasing the income levels, agriculture play a key role in reducing poverty. The present study was conducted to analyse the impact of agriculture growth on poverty reduction in Karnataka state by using secondary data. The relationship between poverty, agriculture GDP per worker and non-agriculture GDP per worker was analysed using pooled panel regression analysis. The results of the study shows that contribution of agriculture sector was far more in decreasing poverty than the non-agricultural sector, as every one per cent increase in agriculture GDP per worker reduced poverty by 1.36 per cent as against 0.80 per cent in non-agriculture GDP per worker. As majority of people depends on agriculture for their livelihood, it is evident that the agriculture sector has a greater impact on alleviating poverty among rural population. However, it suggested that the balanced growth across all three sectors of the economy will help to reduce the poverty rates by increasing income level of the population.

Public science and environmental sustainability: a national culture framework for innovation ecosystems en route to net zero

Despite the proliferation of national environmental science worldwide, the erosion of environmental sustainability presents a problem for advanced economies with a substantial volume of scientific output. The worsening state of the natural environment presents a profound conundrum at the intersection of science and sustainability, characterised by conflicting pathways for the world’s nations. In this study, I confront this predicament by examining whether the influence of national culture moderates the transition of domestic scientific research into tangible CO2 emissions reduction. Drawing on a dataset spanning 30 nations renowned for their high scientific productivity over a 24-year period, I use a panel data model that incorporates lag time to analyse the nuanced impact of national cultures on sustainability. My findings reveal distinctive outcomes: those cultures characterised by high Power Distance (e.g., Eastern European) contribute to increased CO2 emissions via an industrial innovation pathway that prioritises economic growth, while those with high Individualism and high Uncertainty Avoidance (e.g., Western European) facilitate a reduction in CO2 emissions through the translation of scientific knowledge into public science that stimulates a societal innovation pathway and sustainability. In addition to these moderating effects, my investigation exposes that Gross Domestic Product (GDP) per capita exerts a direct positive influence on CO2 emissions, while an increase of GDP allocated to military expenditure (e.g., USA, China, Israel, South Korea) has detrimental effects on CO2 emissions, potentially hampering Net Zero aspirations. These findings hold significant implications for both theory and policymaking in the environmental arena.

Relationship between net migration and economic development of European countries: Empirical conclusions

The study aims to investigate the relationships between the volume of net migration and the economic development of individual European countries, which will make it possible to forecast the level of GDP and strengthen their migration policy. Correlation-regression analysis was used based on statistical data from Eurostat and the State Statistics Service of Ukraine for the period 2014−2021 for selected European countries (the EU-27 member states, Switzerland, and Ukraine). The correlation-regression analysis showed a relationship between the volume of net migration and the level of GDP. The linear correlation equations forecasted the value of the GDP level depending on the influence of a single factor – the volume of net migration. The attention is focused on the importance of migration, which ensures economic growth for Poland. It is attractive due to a simpler mechanism for moving immigrants than in other EU-27 countries, ease of language learning and easier adaptation, territorial proximity, and a higher standard of living compared to neighboring countries that were part of the Soviet Union. Thus, an increase in net migration to Poland by 1% will lead to an increase in gross domestic product by 1.43 million euros. Due to Russia’s war against Ukraine, net migration from Ukraine to Poland has increased significantly, potentially increasing Poland’s GDP in 2023 by 0.08% or 529.54 million euros.

How US Fiscal and Monetary Policy affect the GDP of Countries with Fixed and Flexible Exchange Rates: Estimates using Korean Data from 1963 to 2022

The simplest large country IS/LM/BP model (Mundell-Fleming Model) predicts that an increase in Government spending in the US would cause an increase in Gross Domestic Product (GDP) for countries with flexible exchange rate regimes and decreases in GDP for countries with fixed exchange rate regimes. In contrast, increases in the US money supply would cause an increase in GDP for countries with fixed exchange rate regimes and decreases in GDP for countries with flexible exchange rate regimes. This paper uses a solution to the omitted variables problem of regression analysis to estimate the effects of US fiscal and monetary policy on the Republic of Korea using quarterly data. The data splits into two sections: (1) from 1962 through 1997, Korea had a fixed exchange rate regime and (2) from 1998 through 2022, Korea had a flexible exchange rate regime. The empirical results fit the Large Country IS/LM/BP predictions.