Search results
1 – 10 of over 48000Barry E. Jones and David L. Edgerton
Revealed preference axioms provide a simple way of testing data from consumers or firms for consistency with optimizing behavior. The resulting non-parametric tests are very…
Abstract
Revealed preference axioms provide a simple way of testing data from consumers or firms for consistency with optimizing behavior. The resulting non-parametric tests are very attractive, since they do not require any ad hoc functional form assumptions. A weakness of such tests, however, is that they are non-stochastic. In this paper, we provide a detailed analysis of two non-parametric approaches that can be used to derive statistical tests for utility maximization, which account for random measurement errors in the observed data. These same approaches can also be used to derive tests for separability of the utility function.
Embedded technologies are one of the fastest growing sectors in information technology today and they are still open fields with many business opportunities. Hardly any new…
Abstract
Purpose
Embedded technologies are one of the fastest growing sectors in information technology today and they are still open fields with many business opportunities. Hardly any new product reaches the market without embedded systems components any more. However, the main technical challenges include the design and integration, as well as providing the necessary degree of security in an embedded system. This paper aims to focus on a new processor architecture introduced to face security issues.
Design/methodology/approach
In the short term, the main idea of this paper focuses on the implementation of a method for the improvement of code security through measurements in hardware that can be transparent to software developers. It was decided to develop a processor core extension that provides an improved capability against software vulnerabilities and improves the security of target systems passively. The architecture directly executes bound checking in hardware without performance loss, whereas checking in software would make any application intolerably slow.
Findings
Simulation results demonstrated that the proposed design offers a higher performance and security, when compared with other solutions. For the implementation of the Secure CPU, the SPARC V8‐based LEON 2 processor from Gaisler Research was used. The processor core was adapted and finally synthesised for a GR‐XC3S‐1500 board and extended.
Originality/value
As numerically, most systems run on dedicated hardware and not on high‐performance general purpose processors. There certainly exists a market even for new hardware to be used in real applications. Thus, the experience from the related project work can lead to valuable and marketable results for businesses and academics.
Details
Keywords
Shelly Singhal, Sangita Choudhary and Pratap Chandra Biswal
The purpose of this paper is to examine the long-run association and short-run causality among oil price, exchange rate and stock market in Norwegian context.
Abstract
Purpose
The purpose of this paper is to examine the long-run association and short-run causality among oil price, exchange rate and stock market in Norwegian context.
Design/methodology/approach
This work uses auto regressive distributed lag (ARDL) bound co-integration test to examine the long-run association among international crude oil, exchange rate and Norwegian stock market. Further to test the causality, Toda–Yamamoto Granger causality test is used. Daily data ranging from 1 January, 2011 to 31 December, 2018 is used in this study.
Findings
Findings of this study suggest the existence of long-run equilibrium relationship among oil price, exchange rate and Norwegian stock market when oil price is taken as dependent variable. Further, this study observes the bi-directional causality between Norwegian stock market and exchange rate and unidirectional causality between oil and Norwegian stock market (from oil to stock market).
Originality/value
To the best of the authors’ knowledge, this the first study in context of Norway to explore the long-run association and causal relationships among international crude oil price, exchange rate and stock market index. Particularly, association of exchange rate and stock market largely remains unexplored for Norwegian economy. Further, majority of studies conducted in Norwegian setup have considered the period up to year 2010 and association of these variables is found to be time varying. Finally, this study uses ARDL bound co-integration test and Toda–Yamamoto Granger causality test. These methodologies have been used in literature in context of other countries like India and Mexico but not yet applied to study the Norwegian case.
Details
Keywords
This paper analyzes the impact of macroeconomic variables such as real exchange rate, exchange-rate volatility, and economic growth of the UK and Norway on Norway’s bilateral…
Abstract
This paper analyzes the impact of macroeconomic variables such as real exchange rate, exchange-rate volatility, and economic growth of the UK and Norway on Norway’s bilateral trade flow to the UK via maritime and other transport modes. The first two models considered trade volume (import and export) via only maritime transport, while the third and fourth models considered trade volume via modes other than maritime transport. The empirical validity of the Marshall-Lerner condition is tested to see whether a devaluation of the real exchange rate improves the trade balance in the long term. In addition to the long-term relationship among variables, short-term effects are also evaluated. The results show that the real income of Norway and its trading partner (the UK) is the main determinant of bilateral trade flow via maritime and other transport modes. Moreover, the results indicate that in the long run, the Marshall-Lerner condition is satisfied only for bilateral trade via modes other than maritime transport.
Details
Keywords
This paper provides a fuller characterization of the analytical upper bounds for American options than has been available to date. We establish properties required of analytical…
Abstract
This paper provides a fuller characterization of the analytical upper bounds for American options than has been available to date. We establish properties required of analytical upper bounds without any direct reliance on the exercise boundary. A class of generalized European claims on the same underlying asset is then proposed as upper bounds. This set contains the existing closed form bounds of Margrabe, (1978) and Chen and Yeh (2002) as special cases and allows randomization of the maturity payoff. Owing to the European nature of the bounds, across-strike arbitrage conditions on option prices seem to carry over to the bounds. Among other things, European option spreads may be viewed as ratio positions on the early exercise option. To tighten the upper bound, we propose a quasi-bound that holds as an upper bound for most situations of interest and seems to offer considerable improvement over the currently available closed form bounds. As an approximation, the discounted value of Chen and Yeh's (2002) bound holds some promise. We also discuss implications for parametric and nonparametric empirical option pricing. Sample option quotes for the European (XEO) and the American (OEX) options on the S&P 100 Index appear well behaved with respect to the upper bound properties but the bid–ask spreads are too wide to permit a synthetic short position in the early exercise option.
The main objective of this study is to examine how political institutions affect economic performance in Ethiopia over the 1980–2019 time periods.
Abstract
Purpose
The main objective of this study is to examine how political institutions affect economic performance in Ethiopia over the 1980–2019 time periods.
Design/methodology/approach
Mainly, the impact of political institution indicators including, level of democracy, political violence, democratic accountability and regime durability have been examined using auto regressive distributed lag (ARDL) bound test approach to co-integration and the error correction model.
Findings
This study confirms that level of democracy and democratic accountability has an adverse long effect on the economic performance of Ethiopia. On the other hand, political violence has a negative short-run causal effect on economic performance in Ethiopia. The study concluded that the deterioration of political institutions harmfully affected economic performance in Ethiopia.
Practical implications
Government policymakers should primarily pay attention to promoting and changing those political institutions that harm economic performance. Additionally, better management of political violence has important implications for fostering the economic performance of Ethiopia.
Originality/value
This study provides some valuable evidence on the nexuses between political institutions and economic performance in Ethiopia. Likely, this is the first investigation on the subject under the consideration to use time analysis and will vigorously contribute to the literature as well by employing the ADRL bound test. Previous studies have examined the impact of the institution on economic growth on a cross-country basis. Further analysis is required to understand the effects of institutions such as level of democracy, political violence and democratic accountability on economic development.
Details
Keywords
Niharika Sinha and Swati Shastri
This paper empirically examines the impact of financial development on domestic investment in India for the period 1989–2017.
Abstract
Purpose
This paper empirically examines the impact of financial development on domestic investment in India for the period 1989–2017.
Design/methodology/approach
This study employs the autoregressive distributed lag (ARDL) bounds testing approach to co-integration to test the long-run relationship between financial development and domestic investment. To test the direction of causality, Toda–Yamamoto causality test and vector error correction model (VECM) Granger causality/Block Exogeneity Wald test have been employed. Investment has been measured by Gross Capital Formation. To capture various aspects of financial development in India, eight alternative indicators (both bank based and market based) have been used. With the help selected indicators, a composite index (FINDEX) of financial development has been constructed using principal component analysis (PCA).
Findings
The estimated result finds evidence in favour of positive, short-run and long-run impact of financial development on investment in the Indian economy. Both bank-based and market-based indicators are found to significantly affect the level of investment. The significant effect of efficiency-based financial development indicators (both bank based and market based) upon domestic investment implies that there is a need to implement policies that ensure the efficiency of financial intermediation.
Originality/value
To the best of authors' knowledge, not much research has been done to explore the relationship between financial development and domestic investment, especially in the case of Indian economy. This study also tries to find the impact of bank-based and market-based financial development indicators upon domestic investment to explore banks vs market issue.
Details
Keywords
Ahamed Lebbe Mohamed Aslam and Sabraz Nawaz Samsudeen
The objective of this study is to explore the dynamic inter-linkage between foreign aid and economic growth in Sri Lanka over the period of 1960–2018.
Abstract
Purpose
The objective of this study is to explore the dynamic inter-linkage between foreign aid and economic growth in Sri Lanka over the period of 1960–2018.
Design/methodology/approach
Both exploratory and inferential data analysis tools have been employed to examine the objective of this study. The exploratory data analysis covered the scatter plots, confidence ellipse with kernel fit. The inferential data analysis included the augmented Dickey–Fuller (ADF) and Phillips–Perron (PP) unit root tests, the autoregressive distributed lag (ARDL) Bounds co-integration technique and the Granger causality test.
Findings
The test result of exploratory data analysis indicates that there is a positive relationship between foreign aid and economic growth. The ADF and PP unit root tests results indicate that the variables used in this study are stationary at their 1st difference. The co-integration test result confirms the presence of long-run relationship between foreign aid and economic growth in Sri Lanka. The estimated coefficient of foreign aid in the long-run and the short-run shows that foreign aid has a positive relationship with economic growth in Sri Lanka. The estimated coefficient of error correction term indicates that approximately 26.6% of errors are adjusted each year and further shows that the response variable of economic growth moves towards the long-run equilibrium path. The Granger causality test result shows that foreign aid in short-run Granger causes economic growth in Sri Lanka which means that one-way causality from foreign aid to economic growth is confirmed. Further, the estimated coefficient of error correction term confirms that there is the long-run Granger causal relationship between foreign aid and economic growth in Sri Lanka.
Practical implications
The findings of this study have some important policy implications for the design of efficient policy related to foreign aid and economic growth, the knowledge of which will help follow sustainable foreign aid and growth nexus.
Originality/value
This study contributes to the existing literature by using the newly introduced ARDL Bounds cointegration technique to investigate the dynamic inter-linkage between foreign aid and economic growth in Sri Lanka.
Details
Keywords
Monica Singhania and Neha Saini
The paper attempts to revisit the nexus between economic growth, carbon emissions, trade openness, financial effectiveness and FDI for a sample of seven developed and developing…
Abstract
Purpose
The paper attempts to revisit the nexus between economic growth, carbon emissions, trade openness, financial effectiveness and FDI for a sample of seven developed and developing countries using curvilinear relationship as per environmental Kuznets curve (EKC) hypothesis over long term.
Design/methodology/approach
The authors determine the unit root properties of variables (using Clemente–Montañés–Reyes unit root test with double mean shifts and AO model and augmented Dickey–Fuller test) for structural breaks at different levels. Autoregressive distributed lag (ARDL) and error correction model (ECM) methodology was used to estimate long- and short-run parameters among the selected variables in sample countries from 1965 to 2016. Vector error correction (VEC) and Granger causality approach was used to determine the direction of causality.
Findings
The authors confirmed long-run relationship among the variables and highlighted high economic growth and energy consumption as the main causes of environmental degradation. While in India financial development and FDI inflows depict a negative association with environmental sustainability, however, such relationship was positive in the United Kingdom (UK), which is often considered as a benchmark for policymakers. The authors’ findings were in agreement with existing research insights in reporting FDI and financial development as the major contributors towards (unsustainable) sustainable environment through emissions in case of (developing country like India) developed country like UK. For other sample countries (China, Brazil, Japan, South Africa, United States of America (USA)), the authors’ model failed to capture financial development and FDI as significant contributors of carbon emissions. However, unidirectional causality running from energy to carbon emission was observed leading to the policy adoption of incentivizing alternative energy-based resources to increase energy efficiency across the energy value chain.
Research limitations/implications
Manufacturing with renewable energy, in collaboration with private and foreign players, under an institutional framework is desirable. Policy instruments including mandatory administrative controls, economic incentives and voluntary schemes that promote energy efficiency building blocks need to be established. A sound legal system for implementing technological innovation, financial subsidy incentives, interest-free loan programmes and development of financial sector supports creation and thriving of energy efficient units, often a perquisite for accelerated development.
Originality/value
By undertaking a comparative analysis, the authors address the research gap through revisiting EKC hypothesis with different set of trade policy and financial development framework. To the best of the authors’ knowledge, earlier studies were limited to one-country data analysis and did not consider the comparative data set of developed and developing countries with reference to financial development and FDI components.
Details
Keywords
This study aims to explore the short-run and long-run relationships and causality between economic growth and financialization in the new member states (NMS-11) and to provide…
Abstract
Purpose
This study aims to explore the short-run and long-run relationships and causality between economic growth and financialization in the new member states (NMS-11) and to provide some policy implications drawn from the empirical findings.
Design/methodology/approach
The autoregressive distributed lag (ARDL) bounds test approach to cointegration with the vector error correction model and the cumulative sum of squares (CUSUMQ) test for stability of functions is used between 1995q1 and 2021q4 to examine the existence of cointegration, relationships and causality between economic growth and financialization.
Findings
The findings of the ARDL bounds test demonstrate that the variables included in the models are bound together in the long run, as confirmed by the associated equilibrium correction. The estimated models indicate that the association between selected variables and economic growth is stronger and more statistically significant in the short run compared with the long run. Also, for NMS-11 understudied countries, short-run causality prevails over long-run causality. The changes in the level of financialization have a significant negative effect on the growth rates in the short run, which aligns with findings from previous empirical studies.
Originality/value
This study extends the existing very limited literature about short-run and long-run relationships and causality among economic growth and financialization, including inflation and unemployment variables, to determine their link in the NMS-11. Specifically, the present study reveals that the current level of financialization hampers economic growth and promoting such economic policies further can have adverse effects on the overall economic growth.
Details