Moment Approach Research Articles

The role of activity restrictions on financial intermediation costs in ASEAN countries

Purpose The purpose of this study is to examine the role of activity restrictions on the financial intermediation costs in ASEAN countries. Design/methodology/approach This study used the two-step system generalized method of moments approach to tackle the endogeneity problems. The sample consists of 130 banks from ASEAN countries covering the over 2009–2022 period. Findings This study provides valuable insights into various dimensions of activity restrictions within the banking across ASEAN countries. The findings highlight that imposing restrictions on activities such as securities, insurance and real estate can significantly elevate intermediation costs, affecting the overall efficiency of the banking sector. Furthermore, restrictions on ownership lead to higher intermediation costs by limiting operational flexibility, thereby constraining banks’ ability to optimize their financial services. Research limitations/implications The sample of this study is limited to banks in ASEAN countries and focuses only on the regulations restricting banking activities. Practical implications The findings suggest that policymakers should conduct a comprehensive review and potential adjustment of the existing regulatory framework related to restrictions on banking activities to strike an optimal balance between risk mitigation and fostering an environment that enhances banks’ efficiency. In addition, regulators could consider introducing regulatory reforms to ownership-related restrictions to promote greater flexibility and adaptability in the banking sector. Originality/value This research contributes to the field of banking by offering valuable insights for policymakers and regulators in ASEAN countries. It provides empirical evidence on the impact of activity restrictions on financial intermediation costs, highlighting key factors for developing more effective regulatory strategies.

EFFECTS OF BOARD CHARACTERISTICS ON FINANCIAL REPORTING QUALITY OF NIGERIA LISTED COMMERCIAL BANKS: A SYSTEM GMM APPROACH

This study investigates the effects of board characteristics on the financial reporting quality of Nigeria-listed commercial banks, focusing on Board Independence (BOI), Managerial Ownership of Shares (MSO), and Board Composition (BC), with a particular emphasis on the significance of Board Meetings (BM). The study aims to provide insights into how these board characteristics influence the accuracy and reliability of financial reporting in the Nigerian banking sector. Employing a quantitative panel research design, this study utilizes a System Generalized Method of Moments (System GMM) approach to analyze data from eight deposit money banks listed on the Nigerian Stock Exchange. The sample includes all deposit money banks with an international authorization license, observed over a five-year period from 2019 to 2023. A census technique was used to ensure that all relevant elements of the population were included in the study, providing a comprehensive analysis of board characteristics and their effects on financial reporting quality. The study reveals that among the board characteristics examined, only Board Meetings (BM) demonstrates a significant impact on financial reporting quality. The findings indicate that frequent and effective board meetings enhance the quality of financial reporting, while Board Independence (BOI), Managerial Ownership of Shares (MSO), and Board Composition (BC) do not show significant effects in this context. This highlights the critical role of regular and substantive board meetings in ensuring accurate and reliable financial reports. The results underscore the importance of focusing on the frequency and effectiveness of board meetings as a key mechanism for improving financial reporting quality. For policymakers and regulators, the study suggests that enhancing the structure and processes of board meetings could be a more effective approach to fostering high-quality financial reporting. For banking institutions, the findings advocate for the implementation of practices that promote regular and meaningful board discussions to address financial reporting challenges. This research contributes to the literature by providing a nuanced understanding of how specific board characteristics influence financial reporting quality in the Nigerian banking sector. The use of the System GMM approach offers a robust analytical framework for examining these relationships, and the focus on Board Meetings as a significant factor introduces a new perspective on improving financial reporting practices. The study’s findings offer valuable insights for both academic researchers and practitioners seeking to enhance governance mechanisms in the financial sector.

Adaptive multi-resolution single-pixel imaging based on local transform

Single-pixel imaging involves a trade-off between imaging quality and efficiency due to its sequential detection, particularly challenging for key areas under large frame sizes. We propose a novel mathematical model for multi-resolution single-pixel imaging based on orthogonal local Hadamard transform. To adaptively determine the center of key areas, we employ a dual strategy combining attention maps and a novel sparse geometric moment approach. Our method executes multi-resolution imaging across various levels using multi-resolution pattern sequences. This strategy enhances the imaging quality of key areas while significantly reducing computational burden. Through simulations and experiments, we demonstrate that our adaptive multi-resolution SPI yields superior imaging results in large frame size scenarios and sparse imaging scenes, effectively addressing the quality-efficiency trade-off in single-pixel imaging.

From instantaneous schedulability to worst case schedulability: a significant moment approach

ABSTRACT The method of significant moment analysis has been used to derive instantaneous schedulability tests for real-time tasks. However, the instantaneous schedulability can only be checked within a finite time window. On the other hand, worst-case schedulability guarantees schedulability of tasks for infinite time. This paper derives the classical worst-case schedulability conditions for pre-emptive periodic tasks starting from instantaneous schedulability, hence unifying the two notions of schedulability. The results provide a rigorous justification for the critical time instants being the worst case for scheduling pre-emptive periodic tasks. The paper also shows that the critical time instant is not the only worst-case moments.

Renewable energy, carbon footprints, natural resources depletion and economic growth in Africa

Purpose This study aims to examine the interplay between renewable energy consumption, carbon footprints, natural resources depletion and economic growth. Design/methodology/approach It engaged 45 African countries using the generalized method of moments (GMM) approach. Data from the World Development Indicators for the period 2000–2023 are used to analyse the relationships among these variables. Findings The result indicates a positive and significant effect of greenhouse gas emissions on economic growth in all regions of Africa, except for Southern Africa. Regarding the depletion of natural resources, the authors observe a dominant negative effect on economic growth. Thus, an increase in the depletion of natural resources contributes to the reduction of economic growth in most regions of Africa, notably West Africa, East Africa and sub-Saharan Africa as a whole. Moreover, the depletion of natural resources can also have negative social impacts, such as conflicts over access to remaining resources, which can indirectly influence economic stability and growth. Originality/value This study contributes to the existing literature by providing empirical evidence of the positive effects of renewable energy consumption on carbon footprints, natural resource depletion and economic growth. By quantifying these relationships, the study offers valuable insights into the potential of renewable energy to address pressing environmental and economic challenges.

Board diversity and firm performance in Chinese manufacturing firms: Moderating role of CEO duality

This study explores the relationship between board diversity and firm performance, with a focus on the moderating role of CEO duality in Chinese manufacturing firms. This study applies panel fixed-effect regression models for the period 2008–2022, and findings show that board diversity is positively associated with firm performance, and CEO duality negatively moderates the relationship. However, the findings also show that a highly diversified board can minimize the negative effect of CEO duality and increase the firm’s performance. Furthermore, the findings broaden the understanding of board attributes, showing that the education index is more evident among other board attributes for firm performance. This study verifies its results using the two-step system generalized method of moments approach and different board attributes in robust tests. The findings suggest that strategic efforts to promote board diversity may increase the board’s monitoring function and control managerial opportunism, ultimately improving firm performance in the Chinese business landscape. JEL CLASSIFICATIONS: G30; G34; L25

The Impact of ESG Disclosures on Financial Performance: Evidence from ASEAN-Listed Companies

With increasing global emphasis on sustainability, corporate transparency in ESG practices has become a critical factor for investors and stakeholders. This study investigates the impact of Environmental, Social, and Governance (ESG) disclosures on the financial performance of listed companies in ASEAN countries. This research employs a dynamic Generalized Method of Moments (GMM) approach to address endogeneity concerns and assess the relationship between ESG disclosure and financial performance indicators such as return on assets (ROA), return on equity (ROE), and market value. Using panel data from ASEAN-listed firms over the period 2013-2022, the findings show that firms with strong historical performance tend to maintain profitability, while ESG disclosures positively influence financial outcomes by enhancing investor confidence and risk management. Larger firms benefit from economies of scale, while excessive leverage reduces profitability. Favorable macroeconomic conditions, such as GDP growth, also play a crucial role in boosting firm profitability. Policymakers should mandate ESG disclosure frameworks, incentivize sustainable practices, and provide financial support to smaller firms. Promoting responsible debt management and ensuring macroeconomic stability through favorable trade policies will also enhance firm profitability and long-term economic growth.

Assessing the impact of three emission (3E) parameters on environmental quality in Canada: A provincial data analysis using the quantiles via moments approach

ABSTRACT Existing studies rarely examine the simultaneous effects of three emitting indicators (3E) – full emitting non-renewable, non-emitting renewable, and low-emitting nuclear - on three specific greenhouse gases: CO2, CH4, and N2O. We investigate the impact of three energy types on environmental quality, using Canadian data from 1990-2022. It incorporates macroeconomic policies, economic uncertainty, geopolitical risks, and eco-innovation, and employs the quantiles via moments method to explore the evolving relationships among these factors, considering provincial variances. Findings reveal that non-renewable energy sources deteriorate environmental quality by increasing CO2, CH4, and N2O emissions across all quantiles (from q.5 to q.95), while renewable and nuclear energies, along with eco-innovation initiatives, have a beneficial effect by reducing greenhouse gas emissions across all quantiles. Economic policy uncertainty is a contributing factor to greenhouse gas emissions across all quantiles, whereas geopolitical risks primarily impact the middle to upper quantiles (from q.50 to q.95). To counteract the lack of cross-sectional dependence in the quantiles via moments methodology, this paper employs Driscoll and Kraay’s standard errors approach to fortify its findings’ reliability. It concludes with policy suggestions promoting renewable energy and eco-innovation through increased investment, vibrant long-term policies, provincial collaboration, and adoption of green technologies.

Consumption patterns of indebted households: unravelling the relevance of fiscal policy

AbstractWe have investigated the influence of fiscal instruments, notably taxes and government spending, on household consumption in two different samples and two measures of household debt to provide a comprehensive analysis of the topic. We used dynamic panel models and the Generalised Method of Moments (GMM) approach for 24 and 32 advanced and emerging countries from 1995 to 2020. Our findings show that fiscal impulses increase private consumption. However, when households are highly indebted, the effects are different, and the increase in public spending or the reduced taxes discourages household consumption compared to the baseline (lower debt) group. These results suggest a precautionary effect.

Macroeconomic variables as determinant of economic growth in Nigeria. A dynamic generalized method of moment approach

Macroeconomic variables as determinant of economic growth in Nigeria. A dynamic generalized method of moment approach

Energy Security and Women’s Empowerment: A Generalized Method of Moments Approach from a Global Perspective

The importance of energy security is emphasized in Goal 7 of the 17 Sustainable Development Goals (SDGs) of the 2030 Agenda to guarantee that everyone has affordable, dependable, and contemporary energy access. In addition to transforming human life, whole economies, and even the planet, sustainable energy offers a chance for a better future. The absence of energy security impacts serious health problems, education, and household difficulties. Research on energy security has emphasized various angles worldwide. However, investigations of the impact of energy security on women’s empowerment are still scant. This study thus investigates the relationship between energy security and women’s empowerment (WE) in 167 countries from 2002 to 2021, as well as the influence of urbanization development levels on this nexus. Moreover, this study explores the variation in women’s empowerment between geographical regions by referencing the MENA, OECD, and SAARC countries. A two-step system GMM was used to achieve the objectives of this research. The findings show first that renewable energy availability has a significant effect on WE worldwide. Secondly, in terms of energy security, the variables total availability of natural resource rents and renewable energy both have a positive impact on women’s empowerment in the MENA, while in the OECD and SAARC countries, they have an indirect link with WE. Third, the integrating effect of total natural resource rents with urbanization significantly affects WE in all five models. Fourth, we used access to electricity to represent resource affordability. Unexpectedly, the results show its negative and significant association with WE. Fifth, in terms of energy security, both energy availability and affordability favor WE in OECD countries. Finally, the coefficient of integration of access to electricity and urbanization shows a positive and significant association with WE in the OECD, MENA, and SAARC regions. However, it is noteworthy to mention that access to electricity alone does not influence WE worldwide. Additionally, a series of tests confirm the robustness of the results. This research provides insight into the development and implications of energy security-related women’s empowerment policies.

Spectral-Galerkin methods for the fully nonlinear Monge-Ampère equation

In this paper, we develop two numerical methods, the Legendre-Galerkin method and the generalized Log orthogonal functions Galerkin method for numerically solving the fully nonlinear Monge-Ampère equation. Both methods are constructed based on the vanishing moment approach. To address both solution stability and computational efficiency, we propose a multiple-level framework for resolving discretization schemes. The mathematical justifications of the new approaches and the error estimates for the Legendre-Galerkin method are established. Numerical experiments validate the accuracy of our methods, and a comparative experiment demonstrates the advantage of Log orthogonal functions for problems with corner singularities. The results highlight that our methods have high-order accuracy and small computational cost.

Is financial development a prerequisite for the tourism-led growth phenomenon? World-wide evidence

Purpose This study aims to re-examine the growth effects of tourism and role of financial development in this process for countries across the globe for the period 1995–2018. Design/methodology/approach Considering the asymmetric effect of tourism on economic performance, the author makes use of a recently developed method of moments approach of quantile regression with fixed effects proposed by Machado and Silva (2019). Findings Model-based on tourist arrival shows a positive effect of tourism on economic performance. Yet, the effect is conditional and shows that relatively low-income economies are benefited more than high-income economies. The results also show that all types of tourism are beneficial for growth, yet business-related tourist arrivals are found to be comparatively more effective than other types of tourism. The evidence also shows that excess tourism does not dampen growth. Finally, the evidence suggests that financial development offers critical absorptive capacity, and tourism-led growth cannot be realised without it. Originality/value In contrast to previous studies, the approach effectively deals with non-normality, endogeneity and heterogeneity across issues. Furthermore, this study uniquely tests the role of financial development in channelling tourism-led development.

Stock market responses to economic sanctions: Evaluating the roles of national reserves and financial market access

Economic sanctions significantly influence stock market capitalization and have critical implications for the national economy. This study investigates the impact of economic sanctions on stock market capitalization, focusing on the roles of national reserves and financial market access in mitigating these effects, utilizing a sample of 87 countries from 2000 to 2021 and employing a two-step system generalized method of moments (GMM) approach to analyze panel data. The findings reveal that economic sanctions, including trade and financial sanctions, significantly reduce stock market capitalization. However, this negative impact diminishes over time as markets adapt. Moreover, higher national reserves and enhanced financial market accessibility can mitigate the adverse effects of sanctions. Case studies in Russia, Iran, China, and Ukraine further validate these results. This study refines economic models, such as the capital asset pricing model (CAPM) and country risk model (CRM), by including sanction intensity, national reserves, and financial market accessibility, offering valuable insights for policymakers and investors dealing with international sanctions.

Maternal Mental Health Spillovers From Child Illness and Disability: A Dynamic Panel Analysis

ObjectivesThere is growing recognition of the consequences of a person’s health and illness experience for the health and wider welfare of those close to them. However, estimation of these health spillovers is challenging. This study adopts a longitudinal approach to examine maternal mental health spillovers associated with various forms of child illness and disability. MethodsDynamic panel models are used in estimating maternal mental health spillovers related to 7 subcategories of chronic child illness and disability. In particular, we use longitudinal data from the Growing Up in Ireland study and a system generalized method of moments approach. We also consider heterogeneity in these spillovers by the severity of the child’s illness/disability and by household deprivation. ResultsWe find that a child’s experience of chronic nervous system conditions and chronic mental and behavioral disorders are associated with 10.8 and 5.1 percentage point increases in the probability of maternal depression, respectively. Similar associations were not observed for other health conditions. Spillover magnitude is also found to be strongly related to illness/disability severity. Finally, subsample analyses reveal a larger association between severe child illness and maternal depression among deprived households. ConclusionsThis analysis, in observing health spillovers related to certain disease categories but not others, draws further attention to their context specificity. Our findings also further corroborate calls for inclusion of caregiver and family member outcomes in the economic evaluation of child health services and support consensus guidelines for collection of these outcomes alongside patient outcomes in clinical trials.

Comprehensive analysis of soil electrical conductivity: an experimental and machine learning approach

Experimental test is conducted to find a relation between soil electrical conductivity with some soil properties. Five input parameters namely water content (w), dry density of soil (γd), degree of saturation (Sr), porosity (η) and voltage (V) are considered to compute electrical conductivity of soil (SEC). The effect of w, γd, Sr and η on SEC are analyzed. These datasets are used in soft computing technique to predict SEC. Five hybrid models namely ANN-GA, ANN-PSO, ANN-FA, ANN-GWO and ANN-MFO are used to predict SEC. To check the performance of these hybrid model, numerous statistical performance parameters (R2, a-10 index, VAF, LMI, RMSE, MAE, MAD and U95) are used. On the basis of these performance parameters, ANN-GA performs better (Due to higher value of R2, VAF, a-10 index and LMI and lower value of RMSE, MAE, MAD and U95) as compare to the other proposed model. The model's performance is also examined using rank analysis, regression curve, Williams plot, error matrix, objective function (OBJ) criterion, and Akaike information criterion (AIC). By applying all the above criteria, it has been observed that ANN-GA model outperforms than the other model to predict SEC. This was recognized to its maximum R2 = 0.9998 and the lowest RMSE = 0.0041 during the training phase, as well as R2 = 0.9975 and RMSE = 0.0112 during the testing phase. The model's reliability index (β) is calculated using the first-order second moment (FOSM) approach, and the result is compared to its actual condition. Additionally, a sensitivity analysis is carried out to ascertain the impact of each input parameter on the output (SEC).Based on the results, the hybrid model of ANN i.e., ANN-GA is potential to assist engineers to predict SEC in the design phase of high voltage buried power cables, ground modification techniques or in the field of agriculture.

Do public governance and financial shocks effect public health? Empirical evidence from MENA region

Financial shocks have an incredible socioeconomic effect on both developed and developing countries. Various recent studies demonstrated that bad public governance impacted public health across all nations. In fact, this study aims to use panel data for 21 countries from the Middle East and North Africa (MENA) region over the period 2000–2020 to scrutinize the effect of both governance and financial crises on public health. We use the generalized method of moments (GMM) approach to carry out the empirical analysis. The objective of using this method is to deal with the issue of endogeneity between exogen variables. Results outline that there is a significant positive association between public governance indicators and public health. Moreover, we found a strong negative association between financial shocks and public health. Thus, the direct negative impact of financial crisis on public health could be mitigated by the indirect positive impacts via institutions and good public governance. This study gives insights to policymakers to take appropriate measures to decrease the severity of the financial shocks and improve healthcare services.

The Impact of Corporate Governance on Bank Risk-taking: Evidence of Islamic Banks in Gulf Cooperation Council (GCC) Countries

Purpose — This study investigates the impact of Islamic corporate governance variables on risk-taking within a sample of 31 Islamic banks (IBs) operating in six countries in the Arab Gulf region during the period 2013–2022. Design/Methodology/Approach — The study utilises content analysis and employs two econometric models: the random-effect generalised least squares (GLS) technique and the generalised method of moments (GMM) approach. Findings — The findings reveal that two characteristics of Sharīʿah supervisory boards (SSBs), namely cross membership and knowledge in accounting and finance, have a negative impact on bank risk. However, it is observed that SSB size demonstrates a positive correlation with bank risk-taking, indicating that SSBs face challenges in effectively performing their supervisory role. Furthermore, it is noted that during the pandemic period, banks demonstrated significantly higher levels of credit risk and global risk. Originality/Value — This research provides a valuable addition to the existing literature by conducting the inaugural analysis of the relationship between SSBs and bank risk-taking in the Arab Gulf region, adding to the understanding of Islamic corporate governance dynamics. Research Implications — The study suggests reinforcing the structure of SSBs in IBs in the Gulf Cooperation Council (GCC) countries by appointing members with educational backgrounds in business, accounting, and finance. Furthermore, it supports the idea that the presence of shared scholars in IBs facilitates rational decision-making by SSBs and contributes to reduced risk-taking. Haut du formulaire

Impact of urbanization and human development on ecological footprints in OECD and non-OECD countries

Ecological footprints play a crucial role in assessing how human activities impact the environment, serving as key indicators. This study investigates the influence of urbanization and human development controlling for GDP and industrialization on ecological footprints, focusing on both OECD and non-OECD countries during the period from 1990 to 2018. The investigation employs an open-access solution framework and utilizes the Generalized Method of Moments approach for analysis. The findings highlight distinct patterns between OECD and non-OECD countries. In OECD countries, ecological footprints are increasing with urbanization and GDP growth while showcasing a negative impact of the Human Development Index (HDI) and industrialization on ecological footprint. Conversely, non-OECD countries demonstrate a positive impact of GDP and HDI on ecological footprints, while there is a negative impact of industrialization and urbanization on ecological footprints. These disparities underscore the need for tailored environmental strategies based on a country's economic and developmental status. The results underscore the importance of investing in the renewable energy sector and implementing stringent environmental policies to mitigate the environmental impact of human activities. This evidence reinforces the urgency for countries, irrespective of their OECD status, to take proactive measures to safeguard the planet from further environmental hazards.

How does participation in Global Value Chains affect embodied carbon emissions in international trade? New insights from cross-country panel data analysis.

Global Value Chains (GVCs) significantly influence international trade and environmental outcomes. Despite the economic benefits of GVCs, their impact on the environment remains under-examined. This study analyzes the effects of GVC participation (considering forward and backward positions) on total carbon emissions embodied in exports (TEEE) and imports (TEEI). Utilizing panel data from 65 economies spanning 1995 to 2018, we apply input-output matrices and the system generalized method of moments (GMM-SYS) approach. Our results indicate that GVC participation generally is associated with reductions in TEEI and increases in TEEE, with backward participation exerting a more substantial impact. Furthermore, we observed asymmetrical impacts of GVC participation between developed and developing countries. Developed nations tend to reap greater benefits from GVC in terms of diminished CO2 emissions associated with imports, as well as notable CO2 reductions in both exports and imports, particularly when forward participation is the focal point. Conversely, developing countries grapple with heightened environmental burdens stemming from their engagement in backward linkages.