Positive GDP Growth Research Articles

Sacrificing sustainability for a higher GDP growth rate

Striving for positive GDP growth often comes at the expense of sustainability indicators, highlighting a crucial dilemma in modern economic development. This empirical study delves into the intricate relationship between sovereign sustainability indicators and GDP growth by using panel data that spans across 15 years for 100 countries and sheds light on the complexities of economic progress in the context of sustainability. Analysis reveals a negative bidirectional relationship between SDG scores and GDP growth rate, prompting further exploration into the determinants of these variables. Notably, GDP growth tends to rise following deteriorations in sustainability, while improvements in certain sustainability indicators, such as quality education and renewable energy consumption, correspond to enhanced GDP growth. However, the interplay between GDP growth factors and SDG scores unveils nuanced patterns, with both positive and negative associations observed across various determinants. These findings underscore the multifaceted nature of the relationship between sustainability and economic growth, challenging the notion that GDP growth alone signifies economic well-being. Considering these insights, policymakers are urged to adopt a holistic approach to sustainable development, integrating diverse econometric metrics, decoupling economic growth from environmental degradation, and bolstering data collection and analysis efforts. By embracing comprehensive strategies that prioritize sustainability alongside economic prosperity, policymakers can pave the way for inclusive and resilient development pathways.

Should the South African Reserve Bank lower the inflation target band? Insights from the GDP-inflation nexus

Should the South African Reserve Bank (SARB) lower the inflation target (IT) band? Does lowering the IT band impact the relationship between GDP growth and inflation? This paper explores these questions considering the SARB Governor, Lesetja Kganyago statements that there is a need to lower the IT band from 3–6% to a point target of 3%. We estimate the VAR model to determine whether the passthrough of positive GDP growth shocks to inflation is nonlinear in South Africa. The inflation effects are delineated into bands (i) above 6% (ii) between 4.5% and 6% (iii) between 3% and 4.5% (iv) between 0% and 3% and (v) when there are no IT bands. Evidence reveals that the passthrough is elevated when inflation exceeds 6% and is lower when inflation is within the (i) 3 to 4.5% and (ii) 0 to 3% IT bands. The passthrough from positive GDP growth shocks is more than halved when inflation is less than 3%. The policy implication is that lowering the IT band from 3 to 6% to 0 to 3% will reduce the passthrough of GDP growth shocks to inflation. It allows expansionary monetary to have more real effects as prices are more rigid in the low inflation environment.

The Effects of Hosting Mega Sporting Events on Local Stock Markets and Sustainable Growth

We examine the economic effects of the Summer and Winter Olympic Games and the FIFA World Cup on the economies of host countries. We found that in the short run, hosting the Olympic Games has a significant positive announcement effect on the host country’s equity market. Our results also revealed a positive effect on the stock market in non-G7 countries hosting a mega sporting event and an insignificant effect in G7 countries hosting such events, indicating that hosting a mega sporting event can provide additional momentum for developing or emerging economies. We did find, however, that while the countries hosting the Summer Olympic Games initially experienced significant positive GDP growth, the effect rapidly diminished after the event. Our results suggest that hosting a mega sporting event such as the Summer Olympic Games is most likely to result in a short-term positive economic momentum, however it hinders sustainable growth for the host countries’ economies.

Growth forecasts and news about monetary policy

We find that 30-minute changes in bond yields around scheduled Federal Open Market Committee (FOMC) announcements are predictable with the pre-FOMC Blue Chip professionals’ revisions in GDP growth forecasts. A positive pre-FOMC GDP growth revision predicts a contractionary policy news shock (positive change in bond yields), a negative GDP growth revision predicts an expansionary policy news shock (negative change in bond yields). Failing to account for this predictability biases the estimates of monetary policy effects on the economy. First, the Fed’s information effect dissipates as the truly unpredictable policy news shock does not affect professionals’ beliefs about the economy. Second, net policy shock has a more negative impact on actual future GDP than the raw policy shock.

Creative Hubs in Hanoi, Vietnam

Creative Hubs in Hanoi, Vietnam

COVID-19 and security-development nexus : Vietnam’s perspectives

Covid-19 is considered as an important factor that impacts largely on the security and development. Covid-19 has caused the shiftin the definition of the national security and significance of new emerging non-traditional security issues, for instance the health security, and human security. Accordingly, Covid-19 has had devastating effects on the poor and human development, due to the economic recession and diversion of resources to focus on coping with the virus, stressing the accomplishment of sustainable development goals. It is anticipated that the entanglement of security and development issues gives rise to more complex challenges to ensure the stability and progress of sustainable economic development. This context has raised a question of how countries, especially lower middle-income countries like Vietnam, could cope with arising challenges and opportunities in the new context. This research concludes that Vietnam, as a perfect case study, has strongly supported global and regional cooperation to reset development agenda to focus on quick economic recovery towards resilient, green inclusive, and sustainable development. Internally, Vietnam was successful in controlling the pandemic, and become one of few countries that achieved positive GDP growth in the region in 2020. The key to overcome these challenges remains with the Communist Party of Vietnam’s strong political leadership to control Covid-19, and to take advantages of development trends such as globalization, shifting of supply chain, digital economy, and green recovery and green growth.

Covid-19 Outbreak Impact on Sectoral Firm Performance Listed in Indonesia Stock Exchange in Various Sectors

The goal of this research is to estimate the impact of the Covid-19 outbreak on firm performance in Indonesia on a sectoral level. According to BPS data (2020), Indonesia's GDP fell in Q2 and Q3 2020, even falling to a negative level. The drop in GDP, on the other hand, was not homogenous across all sectors. In Q2 and Q3 2020, there are sectors with positive GDP and sectors with negative GDP. This research looks at three sectors with positive GDP and three with negative GDP. This research uses secondary data, namely financial report data published by each of the firms. STATA software was used to process research data using panel data regression. This research provides results that the Covid-19 outbreak had a positive impact on firm performance in sectors with positive GDP growth during the outbreak and a negative impact on firm performance in sectors with negative GDP growth during the outbreak. As sectorally, the Covid-19 outbreak had a positive impact on firm performance in the health sector. The Covid-19 outbreak had a negative impact on firm performance in several sectors, these are the transportation and logistic sector, car and motorcycle trading sector, and the construction sector.

Papua New Guinea agri-food trade and household consumption trends point towards dietary change and increased overweight and obesity prevalence

BackgroundPapua New Guinea (PNG) experienced positive GDP growth at approximately 4.3% per year during the last decade. With increases in overall wealth within the country, PNG is facing a double burden of malnutrition: comparatively high child stunting rates and a growing overweight and obesity epidemic. We focus on the latter by evaluating trends in agri-food import data from 2001 to 2018 and household consumption data from 2018 and 2009/10.ResultsThe analysis presented in this paper raises three red flags. First, international food import data suggest that the demand for ultra-processed, sugar-sweetened beverages and food have increased substantially over time in PNG. Sugar-sweetened beverages dominated the largest growth in processed food imports, increasing by 23% per capita per year between 2001 and 2018. Second, households across the country with a greater food expenditure on sugar-sweetened beverages have a higher probability of an overweight child (under 5 years old). Last, the probability of soft-drink consumption in PNG increases with greater income acquisition and improved market access. While the price of a soft drink is negatively correlated with the quantity consumed, analysis suggests that total household income has a quantitatively larger (and positive) association with soft drink consumption.ConclusionsTaxing (or increasing taxes on) sugar-sweetened beverages may not be a sufficient policy mechanism to curb overconsumption of soft drinks in PNG. Education and advocacy programs should be fostered that integrate improved dietary information on packaging, as well as greater access to and understanding of nutrition and diet information of common household consumption items. While increases in household income and market access are crucial to economic growth and transformation, PNG’s economic transition must be dovetailed with programs that expand and enhance health and nutrition information and education to improve household consumption decisions and overall household wellbeing.

China's Economy Amidst the COVID-19 Pandemic: Current Situation, Countermeasures, and Implications for Financial Institutions

Prior to 2020, global economic forecasts were on a downward trend. The COVID-19 pandemic has caused a further disruption in economic activity across the world, temporarily ceasing operations in numerous sectors. China, the first country with known cases of COVID-19, has suffered from slower economic growth. Relative to other nations, however, economic damage in China has been mitigated: despite predominantly negative global economic forecasts, the International Monetary Fund projects China to be one of the only major economies to record positive GDP growth in 2020 and 2021. Much of this can be attributed to China’s “Dual Circulation” countermeasures. We examine three lenses through which these measures can be comprehended, as well as key factors for “Dual Circulation” to be sustained. Ultimately, we find that in order for China’s economic recovery to continue over an extended timeframe, an emphasis must be placed on the health of micro, small, and medium-sized enterprises (MSMEs). Capital investment must also remain a continuous driver to sustain domestic circulation.

Peripheral Europe beyond the Troika: assessing the ‘success’ of structural reforms in driving the Spanish recovery

Since 2014 the Spanish economy has recovered positive GDP growth, and the country has been growing well above the eurozone average. This recovery has sparked an academic and political debate concerning the role that structural reforms, prescribed by the ‘Troika,’ have played in peripheral Europe. For certain scholars and institutions, these structural reforms have allowed the market, through greater wage flexibility, to make the necessary adjustments to restore economic growth, resulting in a ‘healthy’ economic recovery. But to what extent is this mainstream narrative solidly backed up by the empirical evidence? Can Spain be held up as an international example of the ‘success’ of these reforms? The aim of this paper is to shed light on this debate. We consider that labor market reforms and wage devaluation policy are not the drivers of economic recovery. Instead, we offer an alternative explanation for recovery based on the theory of demand-led growth.

The Impact of Fiscal Decentralization on Economic Growth in Central and Eastern Europe

In this research, we evaluated the impact of fiscal decentralization on GDP per capita growth. Using the unbalanced panel data, the authors assessed the interconnections between fiscal decentralization – considering its expenditure and revenue aspects as well as tax autonomy – and economic growth for Central and Eastern European countries from 1995 to 2018. In the examined states, the expenditure decentralization exceeded the revenue one. We found out that revenue decentralization and tax autonomy adversely affected economic growth. But expenditure decentralization associated with a positive GDP growth rate. In this paper, we also explored the peculiarities of fiscal decentralization reform. Structural transformations radically reduced the size of the public sector in Central and Eastern Europe, which had a positive effect on the economy. The vital components of local budgets tax revenues are personal income tax and the property taxes. The most effective mechanism for the property tax base’s determination arises from the value of the real estate or land.
 Keywords: fiscal policy, fiscal decentralization, tax autonomy, property taxes, economic growth

Growth Forecasts and News About Monetary Policy

I find that 30-minute changes in bond yields around scheduled Federal Open Market Committee (FOMC) announcements are predictable with the pre-FOMC Blue Chip professionals’ revisions in GDP growth forecasts. A positive pre-FOMC GDP growth revision predicts a contractionary policy news shock (positive change in bond yields), a negative GDP growth revision predicts an expansionary policy news shock (negative change in bond yields). Failing to account for this predictability biases the estimates of monetary policy effects on the economy. First, the Fed’s information effect dissipates as the truly unpredictable policy news shock does not affect professionals’ beliefs about the economy. Second, net policy shock has a more negative impact on future actual GDP, than the raw policy shock.

Новые тенденции в развитии мировой экономики

After the crisis of 2008–2009, dynamics and structural characteristics of the global economy experienced profound changes. Instead of shifting to a ‘New Normal’ of any kind, it presented both developed and developing economies with a set of strategic options involving technological, institutional, and economic policy trade-offs. Most resourceand technology-related ‘forks in the road’ are relatively growth-friendly, as the choice among the available strategic alternatives can rely on efficiency-maximizing economic calculus (although in some cases, as with the labor-saving technological change, social costs can be rather sensitive). This applies also to the dynamics of institutional change, with different economic and social institutions having proved their compatibility with positive GDP growth. On the contrary, economic policy trade-offs are much more challenging, as efficiency-improving policy reforms often bring opposition by vested interests and/or electoral risks. As for global economic governance, these risks are complemented with nationalist temptations inviting political decision makers to sacrifice global norms for country-specific benefits. In this sense, recent trends in global trade are especially warning, as proliferation of trade barriers can further reduce growth in global trade and downgrade the role of export demand as the engine of global development. Thus far, both markets and most experts considered new US protectionist initiatives as elements of the bargaining strategy used by the Trump administration, which will more likely result in concessions by the affected country partners rather than in retaliatory measures. However, the scenario of full-fledged trade wars should not be ruled out. The history of the global economy presents numerous cases when political ambitions and conflicting trading interests generate outcomes leaving all the parties worse off. Preventing the collapse of the existing regimes and institutions of global economic governance appears one of the key factors responsible for keeping growth rates of global GDP above 3 per cent in short- and medium-run perspective.&nbsp

Trade Linkages and International Business Cycle Comovement: Evidence from Korean Industry Data

Through the 2000s, Korea’s export and import linkages to advanced and emerging markets increased significantly. At the same time, the correlation of output growth between Korea and these economies rose. This paper investigates the nature of the link between trade linkages and the comovement of international business cycles (BC) using Korean industry-level domestic and international input-output data. The results suggest that, at the industry-level, higher export linkages lead to a larger positive GDP growth comovement, while higher import linkages lead to higher negative employment growth comovement. Furthermore, the decomposition of aggregate BC comovement shows that the increase in trade with China has contributed the most to aggregate BC comovement, while the impact of trade linkages on BC comovement is propagated domestically via vertical linkages. These findings suggest that the Korean economy can be significantly affected by a few countries that are highly linked through trade to Korea and/or a few industries that are highly interconnected to other industries.

Determination of an Optimal Threshold for Public Expenditure in Côte d'Ivoire

Determination of an Optimal Threshold for Public Expenditure in Côte d'Ivoire Adepoh Adepoh Abstract The objective of this article is to determine an optimal size of public expenditure in Côte d'Ivoire. We used annual secondary data covering the period 1970-2016. The quadratic model used is based on Vedder and Gallaway (1998). This model expresses a non-linear relationship between the volume of public spending and real gross domestic product (real GDP). We have found an optimal threshold for public expenditure of 34.50% of GDP in Côte d'Ivoire. A threshold above which public expenditure becomes detrimental to the health of the economy (Dar and Amirkhalkhali, 2002). If we consider the last five years, we can conclude that the Ivorian Government has reached its optimal level of public spending. This is justified by the positive GDP growth rate of 8.68% on average recorded by the Ivorian State (DGCPT, 2017). However, the achievements of socio-economic infrastructure by individual governments could only be fully appreciated if they could reduce social inequalities. Yet, the poverty line (46.3%) remains high in Côte d'Ivoire (ENV, 2015). Full Text: PDF DOI: 10.15640/jeds.v7n3a2

Trade Linkages and International Business Cycle Comovement: Evidence from Korean Industry Data

Through the 2000s, Korea’s export and import linkages to advanced and emerging markets increased significantly. At the same time, the correlation of output growth between Korea and these economies rose. This paper investigates the nature of the link between trade linkages and the comovement of international business cycles (BC) using Korean industry-level domestic and international input-output data. The results suggest that, at the industry-level, higher export linkages lead to a larger positive GDP growth comovement, while higher import linkages lead to higher negative employment growth comovement. Furthermore, the decomposition of aggregate BC comovement shows that the increase in trade with China has contributed the most to aggregate BC comovement, while the impact of trade linkages on BC comovement is propagated domestically via vertical linkages. These findings suggest that the Korean economy can be significantly affected by a few countries that are highly linked through trade to Korea and/or a few industries that are highly interconnected to other industries.

Zmeny zloženia kompozitného predstihového indikátora Slovenska v čase

Cyclical behavior of the economy can be monitored and predicted with the help of composite leading indicator (CLI) which is an aggregate index of several individual indicators and is statistical relevant for analyzing and forecasting of reference series. This article is focus on construction of CLI for Slovakia and its changes over time. For its construction is used combination of methodologies of OECD and Institute of Informatics and Statistics (Infostat). These methodologies are based on chosen reference series and 124 economic indicators, filtering of time series with Hodrick-Prescott filter (HP filter), normalization of time series, cross correlation and creation of CLI with system of same and different weights. On the base of economic indicator analysis are selected different groups of leading cyclical indicators in seven different time periods. It means that exist changes of CLI composition over time. The best predictable abilities of Slovak business cycle has CLI constructed from time period 2010-2015. On this base was created short-term forecast of Slovak business cycle which supposed economic grow in second and third quarter 2017. Positive GDP growth expectations create space for new investment opportunities as well as government restrictions on public expenditures. The result of our analysis indicate that in the future we can expect new changes in composition of CLI for Slovak economy.

Jamaica: First Review Under the Stand-By Arrangement, Request for Waiver of a Performance Criterion, and Request for Modification of Performance Criteria

This paper discusses Jamaica’s First Review under the Stand-by Arrangement (SBA), Request for Waiver of a Performance Criterion (PC), and Request for Modification of PC. Program implementation remains strong under the SBA. Sustained macroeconomic discipline and visible reforms have boosted stability and confidence. Positive real GDP growth has been recorded in seven consecutive quarters, and Jamaica is projected to grow 2 percent in fiscal year 2017/18, bolstered by construction and tourism, among other factors. Inflation reached an all-time low in 2016, and investor confidence is at an all-time high, attracting foreign direct investment. The current account deficit has narrowed significantly, supporting accumulation of nonborrowed reserves.

Imbalances, Inequality and Growth — Rethinking Growth Policies for Europe

Positive GDP growth is important, but how much GDP growth we need and how the growth of income should be distributed are equally important questions. This explains why (for reasons of distribution and environmental sustainability) a movement has developed over the last ten years to go beyond GDP. Progress has been made in measuring the social and environmental impact of growth, which has helped in the development of EU objectives like achieving smart, sustainable and inclusive growth.

EDB Macroreview, October 2016 - Economic Recovery Trajectories in Eurasia

In recent years, positive expectations have not been met for the second half of the year regarding economic recovery in the EDB member countries. In both 2015 and 2014, unfavorable external factors, primarily the fall in oil prices, had a negative effect on the dynamics of economic growth in the region. Available data for Q3 2016 indicate a more favorable scenario. This is suggested by both macroeconomic data and leading indicators, as well as signals from international credit rating agencies. Trends in regional growth dynamics in the past several months point to the start of economic recovery. Indeed, judging by data for July-August 2016, there are grounds for positive GDP growth rates in the EDB countries in Q3 2016. To all appearances, one can also expect positive changes in inflation before the end of 2016. The inflation rate in Russia is expected to be lower than 6% in 2016. It will hit an all-time low in 2017-2018 and be close to the central bank’s target of 4%. We expect a fall in the aggregate inflation rate of the EDB countries from 12.8% in 2015 to 6.1% in 2016, and a further slowdown in the rise in consumer prices to 4.8% in 2017 and 4.2% in 2018. Apart from the low world prices on food and primary commodities, a significant contribution to the decline in inflationary pressure is delivered by the stabilization of the exchange rates of the EDB countries’ currencies throughout Q2-Q3 2016. This trend is partially due to a decline in the outflow of capital from EDB countries and makes it possible for the countries to replenish their foreign exchange reserves. An important factor for the economic recovery in a number of the EDB countries was the rise in exports, primarily to the Russian Federation. In some countries, the acceleration of the rise in exports may be attributable to the depreciation of the national currency. However, Kyrgyzstan showed an increase in exports to Russia despite the strengthening of the som against the ruble, which suggests that integration factors may have played a certain role. Despite the positive changes however, there are lingering risks of imbalances in a number of macroeconomic sectors, primarily in the budgetary sphere. There are still significant global risks related to: the slowdown in the growth of the Chinese economy; the fall in the prices of primary commodities; the deterioration of the situation in the banking sector of European countries; as well as an increase in the Fed rate.