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This study aims to analyze the long-run dynamic relationship between financial inclusion and economic growth for developing nations.

This study develops a comprehensive financial inclusion index based on the UNDP methodology for 53 developing nations. The authors use second-generation unit root tests, cointegration techniques and an advanced dynamic common correlated effects estimator model called cross-sectional augmented autoregressive distributed lags (CS-ARDL) to examine long-run dynamics among variables.

The tests confirm the presence of slope-heterogeneity and cross-sectional dependency. The second-generation panel unit root tests show the chosen variables are stationary at first difference. The bootstrap Westerlund cointegration result shows the variables are cointegrated in the long run. The CS-ARDL estimates conclude that financial inclusion positively enhances gross domestic product per capita in selected developing countries. The robustness check through augmented mean group estimation validates the findings.

The study makes three important contributions: first, it constructs a comprehensive financial inclusion index using 10 variables for a panel of 53 developing nations; second, the potential cross-section dependence and slope heterogeneity of panel data have been accounted for by applying the second-generation unit root tests; third, the study uses the dynamic common correlated effects estimator model (CS-ARDL) to examine long-run dynamics among variables.

The purpose of this paper is to determine the effect of information and communications technology (ICT) on the provision of social services, as well as the moderating effect of institutional quality on the relationship between ICT and the provision of social services for 31 low-income countries.

This study is based on panel data from World Development Indicators and Worldwide Governance Indicators spanning 1996 to 2020 for 31 low-income countries. To analyze the data, the study uses cross-sectional dependence tests, slope heterogeneity tests, panel unit root tests, panel cointegration tests and cross-sectionally augmented autoregressive distributed lag (CS-ARDL) analysis.

The results overwhelmingly show that ICT has a significant positive effect on the provision of social services in both the short- and long-run. Also, the study reveals that institutional quality has a significant positive impact on the provision of social services in the short- and long-run. The results further provide empirical evidence of the positive and significant moderating effect of institutional quality on the relationship between ICT and the provision of social services.

This study points out the significant potential of identifying appropriate scales of ICT infrastructure and institutional quality needed to support the various governments in low-income countries to improve social services delivery mechanisms and outreach efficacy and impact. The study can be invaluable for ICT innovators and policymakers in promoting the provision of social services.

To the best of the authors’ knowledge, this study represents the first attempt to determine the effect of ICT on the provision of social services, as well as the moderating effect of institutional quality on the relationship between ICT and the provision of social services, especially for low-income countries using CS-ARDL.

This paper aims to examine the impact of information and telecommunication technologies (ICT-proxied by mobile phone subscription and Internet usage) on carbon dioxide (CO2) emissions in the Organization for Economic Cooperation and Development (OECD) countries from 1990 to 2018.

The Cross-section Autoregressive Distributed Lag (CS-ARDL) model is employed to address the potential cross-section dependence problem. Common Correlated Effects Mean Group (CCEMG) and Augmented Mean Group (AMG) estimators are used to test for robustness of results.

Results reveal contrasting effects of mobile phone subscription and Internet usage on CO2 emissions. While mobile phone penetration helps mitigate CO2 emissions, Internet usage tends to increase the emissions. Findings show that renewable energy is beneficial to the environment while economic growth is harmful to the environment. The effects of financial development and trade openness seem negligible.

This study offers practical implications for policymakers. As different proxies of ICT could have contradictory impact on CO2, governments should be cautious against utilizing ICT to mitigate CO2. Findings point to the benefits of renewable energy in alleviating CO2 emissions. Therefore, governments are strongly advised to implement policies facilitating renewable energy consumption.

Previous studies ignored the problem of cross-section dependence which could lead to biased results and cause misleading inferences. This study aims to fill this void in the literature.

The authors reinforce the existing literature on the effect of overall globalization on institutional quality (IQ), while incorporating the effects of economic, political and social aspects of globalization, human capital, government expenditure and population growth. To this end, the authors estimate panel data models for a sample of 36 member countries of the Organization of Islamic Cooperation (OIC) during 1984–2016.

The authors employ the cross-sectional autoregressive distributed lags (CS-ARDL) approach.

The study’s investigation affirms the presence of an inverted U-shaped (nonlinear) relation between overall globalization and IQ indexes for the sample countries, which suggests no additional room for improvement in IQ. It also underpins the existence of an inverted-U-shaped (nonlinear) relation between political globalization and IQ. In contrast, economic and social globalizations have a U-shaped relation with IQ, implying more scope for improvement.

The findings have key policy implications. First, policy makers should consider a long-run approach for improving IQ and globalization over time. Second, quick reforms in the short run may not improve IQ.

The results suggest that policy makers should approach the globalization process from a long-run perspective as well by designing appropriate strategies to provide a continuous but gradual increase in globalization so as to systematically monitor the threshold limits to IQ from improving globalization

To the best of the authors’ knowledge, this work is the first to empirically investigate the overall role of globalization in promoting IQ under the conditions of short-run heterogeneity and long-run homogeneity. The authors focus on the member countries of the OIC, many of which are ruled by authoritarian regimes and suffer from a poor domestic institutional setting.

Shadow banking has been evolving rapidly in China, with banks actively using wealth management products (WMPs) to evade regulatory restrictions. These products are the largest constituent of China's shadow banking sector. A large number of these products are off-balance-sheet and considered a substitute for bank deposits. China's banking sector, especially the small and medium-sized banks (SMBs), uses these products to avoid regulatory restrictions and sustainability risk in the deposit market.

This study empirically examined how banks in China, specifically SMBs, utilize these products on a short and long-run basis to manage and control their deposit levels. This study utilized a quarterly panel dataset from 2010 to 2019 for the top 30 Chinese banks, by first implementing a Panel ARDL-PMG model. For cross-sectional dependence, this study further executed a cross-sectional augmented autoregressive distributive lag model (CS-ARDL).

Under regulations avoidance theory, the findings revealed that WMPs and deposits have a stable long-run substitute relationship. Furthermore, the WMP–Deposit substitute relationship was only significant and consistent for SMBs, but not for large four banks. The findings further revealed that the WMP–Deposit substitute relationship existed, even after the removal of the deposit rate limit imposed by the People's Bank of China (PBOC) to control the deposit rates.

The individual bank-issued WMPs' amount data is not available in any database. Therefore, this study utilized the number of WMPs as a proxy for China's banking sector's exposure to the wealth management business.

This research helps policymakers to understand the Deposit–WMP relationship from the off-balance-sheet perspective. During the various stages of interest rate liberalization, banks were given more control to establish their deposit and loan interest rates. However, the deposit rates are still way below the WMP returns, making WMPs more competitive. This research suggests that policymakers should formulate a more balanced strategy regarding deposit rates and WMPs returns.

This study contributes to the existing literature on China's shadow banking by concentrating on the WMPs. This research represents one of the few studies that analyze regulatory arbitrage in terms of the WMP–Deposit relationship. Moreover, the implementation of CS-ARDL panel data models and multiple data sources makes this study's findings more reliable and significant.

The purpose of this paper is to look at the asymmetric effect of oil production on environmental degradation in OPEC member countries from 1970–2019.

The authors build a nonlinear panel ARDL–PMG model using the Shin et al. (2014) nonlinear autoregressive distributed lag (ARDL) approach in panel form to assess both the short- and long-run impact of positive and negative oil production movements on CO₂ emissions.

The result demonstrates that the variables are cointegrated. According to the linear long run coefficients, oil production, FDI inflows and economic growth both have a positive and significant relationship with CO₂ emissions, implying that they deteriorate environmental quality in OPEC countries, while renewable energy has a negative relationship with CO₂, implying that increasing renewable energy improves environmental quality. The asymmetric findings prove that positive and negative shocks of oil production exert a positive effect on carbon emissions in short run and long run.

To begin with, the empirical assessments do not include all OPEC member nations; researchers are advised to resolve this constraint by looking at the economies of other OPEC members. Albeit the lack of data for other energy sources may serve as another constraint of this research, future research is expected to broaden the current framework via other energy sources such as nuclear, electricity, biomass, solar as well as wind.

The research adds to the body of knowledge as many of the prevailing studies in the literature failed to look at the asymmetric effect of oil production on the quality of environment. This is another gap in the literature that the current study is set out to fill. This study adds oil production as an explanatory variable and helps to extend the existing literature for OPEC countries, which could propose a solution to deal with ensuing environmental issues.

Motivated by the negative effect of external shocks on the domestic economy, this study explores the role of financial sector development in absorbing the effect of external shocks on macroeconomic volatility in Nigeria.

Autoregressive distributed lag and fully modify ordinary least square are used to examine the moderating effect of financial development in the link between external shocks and macroeconomic volatilities in Nigeria between 1986Q1 and 2019Q4. External shock is proxy using oil price shock, and financial development is proxy by domestic credit to the private sector and market capitalisation. At the same time, macroeconomic volatility is proxy by output and inflation volatilities. Macroeconomic volatilities are generated using generalised autoregressive conditional heteroskedasticity (GARCH 1,1).

The results indicate that domestic credit to the private sector significantly reduces output and inflation volatilities in Nigeria in the short and long run. However, market capitalisation promotes macroeconomic volatility. More specifically, financial development indicators play different roles in curtaining macroeconomic volatilities. The results also reveal that external shocks stimulate macroeconomic volatility in Nigeria in the short and long run. Nevertheless, the effects of external shocks on macroeconomic volatilities are reduced when the role of financial development is incorporated.

This study, therefore, concludes that strong financial sector development serves as a significant shock absorber in reducing the adverse effect of external shock on the domestic economy.

This study contributes to the extant studies by introducing a country-specific analysis into the empirical examination of how financial development can moderate the influence of external shock on macroeconomic volatilities.

This chapter examines the influence of external public borrowing resources on economic progress in Tunisia. The study focuses on two stages: First, the influence is studied in a direct sense and then in an indirect sense, i.e., through a transmission channel of this influence. By applying the autoregressive distributed technique with staggered lags (ARDL), over a period ranging from 1986 to 2019, the results showed that the influence of external borrowing resources on growth seems to be unfavorable in the short term but positive in the long term, hence the importance of the empirical technique chosen. Second, three interaction variables were tested, namely total government expenditure, government investment expenditure, and the real effective exchange rate. The results obtained call for better attention to the channels identified to maximize the positive influence of external public debt on the country's economic progress.

The purpose of this paper is to amend the New Keynesian Phillips Curve (NKPC) model to include inflation volatility. It provides results on the determinants of inflation volatility and expected inflation volatility for ordinary least squares and autoregressive distributed lags (1,1) models and for change in inflation volatility and change in expected inflation volatility using error correction mechanism (ECM) models. Output gap affects change in expected inflation volatility alone (in the ECM model) and not in the other models. Major determinants of inflation volatility and expected inflation volatility are identified. To the best of the authors knowledge this is the first paper to augment the NKPC to include inflation volatility.

Recent analysis has indicated the importance of inflation volatility for the monetary transmission mechanism in India (Kapur and Behera, 2012). In the analysis of such monetary policy mechanisms the NKPC has proved to be a useful tool. Thus Patra and Ray (2010) for India and Brissimis and Magginas (2008) for the USA find considerable support for the standard NKPC. The purpose of this paper is to synthesize and integrate these two models by extending the standard NKPC framework to include inflation volatility and test its significance for the case of India.

In the case of inflation volatility output gap, lagged output gap and lagged inflation volatility are all insignificant. The level of inflation has a negative significant impact whereas the level of expected inflation has a positive and significant impact. In the case of expected inflation volatility lagged output gap has a negative and significant impact, the price level has a positive and significant impact whereas expected price has a negative and weakly significant impact. ECM reveals change in inflation variability falls significantly with lagged inflation volatility and lagged inflation and less significantly with change in expected inflation. It rises with lagged expected inflation although the coefficient is only weakly significant. Lagged output gap and change in output gap are insignificant.

This paper makes two original contributions. First, it extends the New Keynesian framework to include inflation volatility. Second, it estimates this model for India. To the best of the authors knowledge this is the first paper to make these contributions.

This study is aimed at testing the validity of the BARS theory and determining the threshold level at which excessive government expenditure hampers growth. The data from 10 African emerging economies from 1988 to 2019 were used.

The methodology comprises several different stages. In the first stage, an Lagrange Multiplier (LM) type test was employed to find the appropriate transition variable among all the candidate variables to assess the linearity between government expenditure and economic growth and to find the sequence for selecting the order m of the transition function. The linearity test helped to identify the nature of the relationships between government expenditure and economic growth. In the second stage, the model evaluation was tested using the wild cluster bootstrap-Lagrange Multiplier (WCL-LM) test to assess appropriateness of the model. Thirdly, the Panel smooth transition regression (PSTR) model with one regime was estimated to test the validity of the BARS curve.

The results revealed evidence of nonlinear effects between government expenditure and economic growth, where the size of the government spending was found to be a 27.84% share of GDP, above which government expenditure caused growth to decline in African emerging economies. The findings combined into an inverted U-shape relationship, in line with the BARS theory.

This study proposes that policy-makers ought to formulate prudent fiscal policies that encourage expenditure, which would improve growth for selected countries as their current level of spending is below the threshold. This might be done through: (1) a suitable investment portfolio and (2) spending more on infrastructure.