Panel Quantile Regression Research Articles

Evolutionary characteristics and influencing mechanisms of green development efficiency in Chinese urban agglomerations: Analysis of the Yangtze River Delta urban agglomeration.

Urban agglomerations are central to global economic growth and the shift towards green development, particularly in developing countries. This study examines regional comparisons and variations in green development mechanisms within urban agglomerations to better understand their spatiotemporal patterns. An input-output indicator system was developed, accounting for social benefits and carbon emissions. Using the Yangtze River Delta urban agglomeration (YRDUA) as a case, this study measured green development efficiency (GDE) from 2003 to 2022 with the SBM-Undesirable model. It also employed the coefficient of variation (CV) method and Markov chain model to analyze the spatiotemporal variability and dynamic transformation law of GDE. Additionally, a panel quantile regression model was used to identify the dynamic response of key controlling factors, based on the GDE stages of each city. The findings reveal: (1) Cities in the central YRDUA area have higher GDE levels compared to those in non-central areas, with increasing disparity over time. (2) The green development level of a city influences its neighbors, enhancing or degrading their GDE stability and type. (3) Economic growth, foreign direct investment, industrial structure, and technological innovation significantly impact YRDUA's GDE. (4) In cities with low green development, economic growth strongly promotes GDE, while government regulation most restricts it. In medium-level cities, industrial structure advancements have the largest promotional effect, whereas technological innovation is the most limiting factor. In high-level cities, foreign investment intensity is the main inhibitor, while government regulation supports GDE. Marketization and environmental regulation effects on GDE remain consistent across different city levels. These findings provide targeted guidance for the green transition of urban agglomerations in China and other developing nations.

Determinants of Money Demand by Business Sector for Extending Monetary Policy Applications in Pakistan

The complex interplay between monetary policy, cash holdings, and their motives holds crucial importance for the economic stability, investment decisions, and financial resilience of a developing country like Pakistan. The nation is enduring a difficult period where it has a weak domestic currency, a burden of foreign debt and adverse exchange rates. Under this situation, corporate cash-holding decisions are highly influenced by monetary policy, making it crucial to explore the determinants of money demand by the business sector to extend monetary policy implications in Pakistan. In order to understand the wider effects of Pakistan's monetary policy, it is crucial to look into the elements that influence the demand for money inside the business sector. Therefore, the current study explores the determinants of money demand by the business sector for extending monetary policy applications in Pakistan and the non-linear association between cash holdings and their motives in order to assess if the priorities of business change with the change in the incidence of cash holding motives. The study used the panel quantile regression for 315 firms listed in the KSE index. The model is merited on its ability to address non-normal variables while handling the panel data sets. The results indicate that all the indicators of demand for cash by firms have a non-linear effect. Transaction and speculative motives have an inverted U-shaped effect, while precaution motives have U shaped effect.

Complementarity effects of financial development and remittance on agricultural production in Africa

PurposeEmpirical evidence abounds on the individual effect of financial development and remittances on agricultural production, but little is known about their complementary role, especially in the context of African countries. This study fills this knowledge gap by examining the moderating role of financial development in the agricultural production–remittance nexus in Africa.Design/methodology/approachDifferent measures of financial development were employed, and the panel quantile regression model was adopted to analyse panel data of 33 African countries covering the period 2005–2020.FindingsThe results indicate that the effects of financial development on agricultural production vary across quantiles, and the dynamics of agricultural production are sensitive to the choice of financial development indicator. Nevertheless, financial development and remittances are highly indispensable for improved agricultural production in Africa, as financial development complements the positive effect of remittances on agricultural production.Practical implicationsAfrican countries need to strengthen their financial sector to facilitate the effective mobilization of remittances and other financial resources for investment in the agricultural sector and the improvement of the sector’s productivity.Originality/valueTo the best of our knowledge, this is the first study that documents empirical evidence on the complementary role of financial development and remittances on agricultural production in Africa.

Analyzing the Heterogeneity of Economic Development and Carbon Emissions in the GCC Countries: Based on Panel Quantile Regression Approach

This study explores the effects of energy use, tourism development, financial growth, foreign direct investment on economic growth, and the carbon emissions nexus for GCC countries from 1980 to 2018. GCC nations are currently facing higher demand and use of energy sources, FDI, tourism development, and improving financial sector that represents the major sustainable environmental and economic growth challenges. This study applies a Panel Quantile-Regression model that accepts distributional and unobserved individual heterogeneity. Furthermore, to avoid a response variable bias, some concerned cause variables are heterogeneous across quantiles in our method. The empirical outcomes indicate that the influence of FDI on CO2 emissions is statistically significant and negative, while tourism growth, energy use and financial growth have an ever-increasing impact on carbon emissions. Likewise, tourism growth decreases economic growth while FDI and energy use have been found to affect economic progress positively. Finally, the research outcomes also support policymakers with significant strategic recommendations.

Does policy integration in renewable energy deployment enhance environmental sustainability in Africa?

ABSTRACT In recent years, the world has observed a steady rise in protective measures toward environmental sustainability, especially in developing countries like Africa, which is seen as a lower contributor to global pollution but is not exempted from the consequences of ozone layer depletion leading to global warming. Empirical evidence about the impact of policy integration and renewable energy deployment on environmental sustainability, especially with nitrous oxide emissions, is missing in academic literature. This study investigates the impact of policy integration in renewable energy deployment and its effect on environmental sustainability in Sub-Saharan Africa (SSA). Using data from 41 SSA countries from 1998 to 2020, we employ the generalized linear model (GLM) and panel quantile regression to address methodological challenges. Our findings indicate that policy integration and renewable energy are crucial for promoting environmental sustainability. Specifically, the results show that voice and accountability significantly reduce CO2 emissions, while political stability and control of corruption contribute to substantial reductions in N2O emissions. While renewable energy consumption decreases CO2 emissions, it is associated with an increase in N2O emissions. Additionally, the interaction between political stability and renewable energy consumption further reduces emissions, and the interaction of control of corruption and renewable energy also mitigates emissions. These effects, however, vary based on regional differences within SSA. Policymakers in SSA should enhance governance, promote regional strategies, and invest in green technologies to balance CO2 and N2O emissions while supporting renewable energy initiatives.

Feed-in tariffs in scaling up solar and wind energy to shield nations from fossil fuel dependence

PurposeThe study attempts to understand how feed-in-tariffs (FITs), government expenditures and environmental quality can impact solar and wind energy consumption (SWC) of nations and can act as a shield against global energy tensions by reducing fossil fuel dependence.Design/methodology/approachOrganization for Economic Co-operation and Development (OECD) and non-OECD countries are compared based on the effectiveness of total governmental expenditures, mean FITs and carbon emissions in influencing SWC and fossil fuel dependence over the period 2000–2019. Fixed-effects panel data regression and bootstrapped panel quantile regression are used in estimations.FindingsFITs and government expenditures boosted SWC in OECD countries, while they were not very effective in non-OECD. Unlike OECD nations, total government expenditures were also not influential in reducing fossil fuel dependence in non-OECD countries. Countries with higher carbon emissions had lower SWC and higher fossil fuel dependence, showing lesser environmental concerns and energy crisis vulnerabilities.Research limitations/implicationsThere is a need for more renewable energy financing programs and governmental expenditures to promote SWC in non-OECD nations. The detrimental effect of carbon emissions on SWC and the positive effect on fossil fuel dependence show the lack of efforts in high carbon-emitting countries in adopting cleaner technologies.Originality/valueThe unique contribution of the study lies in the comparative analysis of the effectiveness of renewable energy financing for country groups and exploring the effects on renewables and fossil fuels simultaneously. An analysis of higher carbon emissions leading to an emission loop by increasing fossil fuel dependence also provides novelty to the study.

Will land transfer affect agricultural carbon emission efficiency? An empirical study based on provinces in China.

Studying the carbon emission efficiency of the agricultural sector plays an important role in achieving the goal of global carbon neutrality. As a common economic behavior in agricultural production, it is still unclear about that how land transfer affects agricultural carbon emission efficiency (ACEE). Therefore, according to panel data of 30 provinces (including autonomous regions and municipalities at the same level) from 2005 to 2019 in the Chinese mainland, this work adopts the panel Ordinary Least Square (OLS) to reveal the influential mechanism of land transfer on ACEE. Subsequently, the panel quantile regression and sub-sample regression are applied to divide the provinces into different types of regions, so as to explore what kind of heterogeneity effect would occur, if land transfer acts upon ACEE. Finally, this work discovers the influential mechanism of land transfer to ACEE by agricultural industrial agglomeration and agricultural land management scale. The research results support the view that the land transfer significantly inhibits the improvement of ACEE, and also prove that there is regional heterogeneity in the impact of land transfer on ACEE, and this heterogeneity is mainly reflected in the impact intensity of land transfer on ACEE in different regions. The more important and deeper discovery is that agricultural industrial agglomeration and agricultural land management scale intensify the inhibition of land transfer on ACEE. Considering that both agricultural industrial agglomeration and agricultural land management scale have a regulatory effect on the influence of the land transfer on ACEE, this work suggests that the government improve the land transfer market system, implement differentiated agricultural management measures, and reasonably promote agricultural industrial agglomeration to gradually realize economies of scale.

Gender and Age Differences in the Relationship Between Smartphone Addiction and Sleep Duration in Korean Children: A Panel Quantile Regression Study.

This study analyzed the longitudinal relationship between smartphone addiction and sleep duration to investigate the factors contributing to sleep deprivation in Korean children. To overcome the limitations of previous studies, panel quantile regression analysis was used to evaluate the relationship between smartphone addiction and sleep duration. Key variables were smartphone addiction, sleep duration, gender, and age. According to the study results, the level of smartphone addiction among children significantly increased from 2018 to 2022, while sleep duration continuously decreased. A particularly strong negative relationship between smartphone addiction and sleep duration was found. These results suggest that smartphone addiction is strongly associated with sleep deprivation in children, emphasizing the need for policies and intervention measures to create a healthy sleep environment for children.

The Asymmetric Effect of CEO Power on Energy Firms’ Strategic Decisions

This study investigates the effect of CEO power on energy firms’ performance, riskiness, and working capital. Our panel quantile regression estimates based on Pakistan data suggest a positive effect of CEO power on firm performance in lower and middle quantiles. Powerful CEOs mitigate excessive risk-taking when the riskiness of firms reaches certain levels. CEO power is negatively related to working capital when the cash holdings exceed a certain level.

Resource extraction, FinTech, and social equal access: A quantitative analysis of resource-rich countries

Resource-rich countries hold potential for the alleviation of social disparities and the promotion of equal opportunities. Well-managed natural resource extraction can spur economic growth, create employment, and provide funds for some of the vital social programs that improve social accessibility to education, healthcare, and infrastructure altogether. Contingent upon such change, this study investigates the impact of natural resource extraction on equitable access for all members of society across countries that happen to be endowed with resources, using data for the period 2011–2022. The Driscoll-Kraay and Panel Quantile Regression methods are used to see how an improvement in resource extraction could benefit society by mainly reducing inequality. Key findings confirm that natural resource extraction positively influences equal access across social domains. FinTech improves directly on the degree of social accessibility and moderates toward sustainable, more inclusive outcomes in the effect of natural resource extraction. The control variables point towards the productive capacities supporting equal access. In contrast, military spending and high energy consumption have adverse effects. The results reveal a dual role of resource extraction and FinTech in helping to achieve inclusive development and underscore policies that would ensure optimal resource management in facilitating equitable societal growth.

The nexus between corporate governance, political environments, and firm performance: a comparative study of Ghana and Kenya

Purpose This study aims to examine the effect of political conditions on the relationship between corporate governance and firm performance in two sub-Saharan African (SSA) countries, Ghana and Kenya. Design/methodology/approach This study used a panel data methodology, examining data from a sample of 72 companies (Ghana: 25 and Kenya: 47) from 2018 to 2022. This study used panel quantile regression and the Huber M-estimation robust least squares regression methods. Findings The research reported that larger boards, diversity and ownership concentration do not affect business performance while board independence improves corporate success in both countries. The findings about chief executive officer (CEO) duality were mixed. In Ghana, CEO duality has a positive effect on firm performance, but in Kenya, the study finds that CEO duality hurts firms’ performance. The results found that higher levels of institutional ownership decreased firm performance in both countries. The research found that Ghana’s political environment had a greater impact on corporate governance and business performance nexus than Kenya’s. Research limitations/implications The research is limited to Ghana and Kenya. This study emphasises the necessity for governments in both countries to maintain a stable political environment, implement policies that encourage economic and policy continuity and reduce political uncertainty to improve business conditions. Practical implications This study emphasises the necessity for governments in both countries to maintain a stable political environment, implement policies that encourage economic and policy continuity, and reduce political uncertainty to improve business conditions. Originality/value To the best of the authors’ knowledge, this study is unique because it is the first in SSA to address a research gap by investigating a comparative analysis of the relationship between corporate governance, political environments and firm performance in two distinct countries with different political situations.

Unpacking the heterogeneous relationship between economic freedom, corruption and income inequality: a cross-country comparison

ABSTRACT Rising globalization, tech breakthroughs, and market shifts increased income inequality. COVID-19 worsened it, emphasizing the issue’s global permanence. This study examines economic freedom’s impact and corruption’s moderating role on income inequality in BRICS and Next-11 countries from 1995 to 2021. Panel quantile regression and Panel ARDL were used to analyse data. Results show economic freedom’s positive impact on income inequality in the overall sample, as well as in BRICS and Next-11 countries. Control of corruption reduces inequality, but interaction with economic freedom worsens its impact. Economic freedom counteracts corruption control’s benefits on inequality.

Does the presence of a sustainability committee strengthen the impact of ESG disclosure on tax aggressiveness? Insights from North America

AbstractWe investigate the influence of ESG disclosure on tax aggressiveness within the North American Travel and Leisure (T&L) sectors, specifically examining the role of sustainability committees in this relationship. Our analysis utilizes longitudinal panel data from the USA B3000 and Canadian S&P/TSX indices over the period from 2010 to 2020. Employing fixed-effects panel quantile regression with two distinct measures of tax aggressiveness, our findings indicate that firms with a focus on ESG tend to display higher levels of tax aggressiveness. This suggests that some companies might use strong ESG performance as a facade to obscure aggressive tax strategies. Moreover, our research introduces new evidence that the existence of sustainability committees can both hinder corporate tax aggressiveness and foster an ethical corporate culture, which aligns higher ESG engagement with lower tax aggressiveness. Our study underscores the importance of fostering tax compliance in T&L companies, emphasizing that individuals and corporations, which often seek direct state benefits, regard robust public services as essential for encouraging adherence to tax regulations. Furthermore, sustainability committees play a crucial role in enabling firms to address broader social issues, including tackling tax aggressiveness, thus shaping their sustainability agendas.

Dynamic impact of green finance on renewable energy development: Based on scale, structure, and efficiency perspectives

Utilizing China's provincial panel data from 2003 to 2021, this paper employs a dynamic panel quantile regression model and mediating test model to investigate the dynamic evolution characteristics, type heterogeneity, and mechanism of green finance (GF) driving renewable energy development (RED) in China, considering the scale, structure, and efficiency of GF. The findings of this study are as follows. While the scale, structure, and efficiency of GF all contribute to the promotion of RED, the impact of green financial structure is particularly significant. As renewable energy continues to develop, the impact of green financial scale and green financial structure gradually diminishes, while the effect of green financial efficiency increases. In comparison to hydropower and solar power, GF has the strongest promotion effect on wind power, and the marginal effect of green financial scale and green financial structure on wind power follows a U-shaped trajectory. The driving of GF on RED is mainly through direct effect, supplemented by indirect effect. In the mechanism by which GF impacts RED, the channels associated with green attributes are relatively smooth. Based on these research conclusions, this paper offers policy recommendations aimed at enhancing RED through GF from perspectives encompassing scale, structure, and efficiency.

Towards carbon neutrality: asymmetric impact of financial development and digitalization on carbon dioxide emissions in Mediterranean countries

The current research investigates the impact of financial development, digitalization, green trade, manufacturing, and national income on carbon dioxide (CO2) emissions of six Mediterranean countries (MEDIT-6). The study uses a nonlinear panel quantile regression model with panel data of MEDIT-6 countries from 1994 to 2022. The study asserts that higher financial development will reduce CO2 emissions for MEDIT-6 countries, as it provides more financing options to invest in green energy and potentially curb excessive energy consumption which in turn reduces CO2 emissions. The study also provides evidence that digitalization in MEDIT-6 countries has led to dematerialization, thereby reducing CO2 emissions. Digitalization makes trade and commerce platforms more efficient by facilitating the smooth flow of information and enhancing the efficiency of production processes. The positive relationship between manufacturing and national income and CO2 emissions exhibits a U-shaped pattern, which supports the existence of Environmental Kuznets Curve (EKC) hypothesis. The study shows how the MEDIT-6 countries have been successful in promoting financial development and digitalization, which helps reduce their CO2 emissions. However, it also raises concerns for policymakers as promoting developmental activities such as manufacturing is inevitable, but it comes with environmental challenges such as higher CO2 emissions. The current study contributes to the reservoir of existing literature by providing fresh evidence from the Mediterranean region on the impact of financial development and digitalization on CO2 emissions.Graphical

A stochastic algorithm for quantile regression models with fixed effects

In this paper, we present a stochastic algorithm for parameter estimation based on panel quantile regression model. We propose an easy-to-implement estimator based on the proposed algorithm. We profile the quantile-specific fixed effects as functions of the parameters of interest based on the Gaussian mixture representation of the asymmetric Laplace (AL) likelihood and eliminate the fixed effects through a data transformation. Parameters of interest can be estimated via quantile regression. Under a set of sufficient conditions, the proposed estimator is consistent and asymptotically normal when n and T both go to infinity. The proposed estimator is illustrated via both simulations and real data examples.

The impact of regional emergency logistics response capacity on sustainable economic growth in China

To assess the impact of China’s regional emergency logistics response capabilities on economic growth sustainability, this study develops a set of comprehensive indicators. It applies the entropy weight method combined with the TOPSIS method to evaluate these capabilities across regions. Based on panel data from 30 provinces in China from 2012 to 2021, this study employs panel models, panel quantile regression, and panel threshold models to analyze the impact of emergency logistics response capability on sustainable economic growth. By measuring the regional emergency logistics response capability and examining its effects on the sustainability of economic growth, this research provides foreign investors with a clearer understanding of the ability of different regions in China to handle unexpected public incidents. This, in turn, helps reduce investment uncertainty, mitigate certain risks, and offers valuable insights for enhancing the efficiency of international investments in China. Key findings are: (1) Since 2018, the establishment of the Ministry of Emergency Management has significantly improved China’s regional emergency logistics capabilities, with the eastern region outperforming the central and western regions. (2) Enhancing China’s emergency logistics response capability helps improve the sustainability level of economic growth. This reflects how China’s emergency management departments can mitigate the adverse impacts of public emergencies on economic growth by transforming social logistics into emergency logistics. (3) As emergency response capabilities have strengthened, their impact on economic sustainability initially decreased but later increased.

Energy transition, institutional quality, and financial development in Africa

This study examines the influence of institutional quality and financial sector size on driving renewable energy (RE) development using a sample of 31 African countries. We first employ a nonparametric trending panel data model that allows us to capture the gradual process of RE transition. The estimated common trend function reveals a steady increase in the share of RE from 2002 to 2019. Although fossil fuels dominate the energy structure in some African countries, a shift toward low-carbon sources is emerging, becoming increasingly significant in the energy mix. In the next step, we apply recent panel quantile regression techniques to model the heterogeneous and asymmetric relationships between RE and its main determinants. We find that institutional quality has a prominent influence on advancing the low-carbon transition, with significant positive effects across almost all conditional quantiles of the RE distribution. However, financial sector size seems to be important only for countries with a lower share of RE. Our results also confirm the asymmetric impact of income growth, which is negative in the lower quantiles but positive in the upper tail of the conditional distribution. From a policy perspective, governance factors, including the quality of policy formulation and implementation, have a critical role in promoting clean energy initiatives in Africa.

Corporate carbon emission governance: The mediating role of financial leverage

This study examines the impact of board composition and CEO behavior on corporate carbon management across 2012–2021. Based on agency theory and resource dependence theory, this study establishes panel quantile regression and mediation effect models to analyze the impact of corporate governance composition and financial leverage on corporate carbon emissions. The findings reveal that diverse boards reduce carbon emissions, highlighting the value of inclusive decision-making. Additionally, the relationship between board size and emissions follows a U-shaped curve, suggesting an optimal size for efficient decision-making; overconfident CEOs tend to increase emissions due to their optimistic risk assessments; and financial leverage further moderates the impact of board size on emissions. This study demonstrates the importance of environmentally responsible leadership and offers insights into how board composition and CEO attributes shape corporate environmental strategies.

Estimating the Non-linear Impact of Environmental Degradation on Climate Vulnerability in Developed and Developing Economies: A Pathway to achieve Sustainable Development

Climate change is a pressing issue in today’s world and is discussed in nationaland international forums. Human activities are blamed as the primary forces behindenvironmental degradation and climate issues. This study assesses the role ofenvironmental degradation on climate vulnerability from a global perspective. Forthis purpose, panel data of countries are collected from 1990 to 2023. The empiricalresults are estimated through panel quantile regression (PQR). Environmentaldegradation is measured using ecological footprint, and climate vulnerability ismeasured using the health vulnerability index by ND-GAIN. The empirical resultsproved the U-shaped relationship between ecological footprint and healthvulnerability in different quantile groups. The further analysis explores that threedeveloped countries (Luxembourg, Qatar, and the United Arab Emirates) haveachieved the threshold value of the U-shaped curve and lay on the right side. Incontrast, the remaining countries are located before maturity. The study warns that ifthese countries deplete the natural resources at the same speed, they push toward theright side of the U-shaped curve, which causes more health vulnerability. This studysuggests that the governments of all global countries should pay special attention tothe declining ecological footprint, which reduces climate vulnerability and improvesthe health sector.