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To analyze the impact of agricultural sector on the economy of North Cyprus, which suffers from political problems and drought over the years.

Annual data covering 1975‐2002 period has been used to find the direction of causality in Granger sense between agricultural growth and economic growth after employing unit root tests to see if the variables under consideration are stationary.

Results of the present study first suggest that agricultural output growth and economic growth as measured by real gross domestic product growth are stationary at their levels, thus, they are naturally co‐integrated. They are in long run equilibrium relationship. And secondly, there is feedback relationship between these variables that indicates bidirectional causation among them in the long run period.

A more expanded data can be used for further comparison. Furthermore, a future study can be done for other islands to make comparison across themselves.

This study has shown that although North Cyprus suffers from political problems and drought in the agriculture sector, this sector still has an impact on the economy. Thus, effective policies related with this sector should be developed by authorities. Building pipelines from Turkey, which are at the agenda of North Cyprus and Turkish governments over the years should immediately put into action. This will have enormous impact on both sides of the island on the way to a solution in Cyprus problem.

This study is the first of its kind which analyzes the relationship between agricultural output and economic growth in a small island which has a closed economy and is politically non‐recognized state. Furthermore, it is a rare study made for small islands.

The purpose of this research is to examine the nature of housing market affordability. Although the problem of housing affordability has been widely discussed, the theoretical underpinnings of the concept have received less attention. It has become increasingly evident that more holistic insights and integrated approaches are needed to provide a platform to define affordability to influence research and policy discourse.

Given the increasing importance of affordability within housing policy reform, this paper seeks to “unearth” the most important prognosticators of affordability. The paper uses principal component analysis to determine how affordability, as a key policy tool, should be analysed. In addition, co integration techniques, Granger causality and impulse response analysis are applied to test the movement and shocks of the key affordability indicators and the two common affordability metrics.

The principal conclusions stemming from this paper demonstrate that affordability is a multifaceted policy concept influenced by financial access (purchase) costs and the repayment costs of housing services which are correlated and interchangeable but significantly were found not to be co integrated.

Understanding the nature of housing market affordability remains problem for policy-makers. This paper adds to the debate and empirical understanding of the cyclic nature of affordability and how it is defined. It shows that there are intricate causal short-term relationships between the key affordability indicators. This is problematic for contemporary housing policy and the key directions in which policy must turn.

This paper sets out to examine the inflation‐hedging ability of housing properties in Shanghai.

This paper examines both the short‐term and long‐term hedging characteristics of Shanghai residential properties against three types of inflation: actual, expected, and unexpected in the test period of 1997‐2005 by using the OLS model. Two methods, the Autoregressive Integrated Moving Average (ARIMA) and the Hedrick‐Prescott Filter, are used to estimate the expected inflation.

The results show that, while the Shanghai housing property market does not provide a hedge against actual expected and unexpected inflation during the period, a positive real rate of return is reported in all cases.

Data limitations are due to lack of complete market transaction records and it is necessary to rely on property indices produced by the private‐sector firms as a proxy for market movements.

The paper shows that government policy in this market is still a dominant factor affecting the rate of return and it has therefore implications for the construction of an efficient investment portfolio by institutional investors.

During the post-globalization period, tariff imposition on manufacturing trade has a possible effect on the economy of developed and developing nations. Along with the volume and balance of trade, the study accounts for both export and import separately in order to observe their dynamisms under the tariff regime and makes comparisons between developing and developed countries. Using the World Development Indicators and World Integrated Trade Solution databases of World Bank (2020) on China (developing nation) and the United States (developed nation) over the period of 1970–2019, the co-integration tests and thereafter vector error correction models indicate that the relationship between tariff and manufacturing trade is positive and statistically significant.

The global financial crisis of 2008 emphasized the need for monetary policy authorities to have a more comprehensive view of the conditions prevailing in the economy before deciding their policy stance. The purpose of this paper is to outline the construction of a financial conditions index (FCI) and investigate the possible co-integrating relationship between the economic growth and FCI.

The study employs the PCA methodology, with appropriate augmentations to handle the unbalanced panel data-sets and constructs a FCI for India. It tests the growth-predicting power of FCI by applying the auto regressive distributed lags approach to co-integration and verifies if the FCI is co-integrated with real GDP growth. It also discusses construction of a financial development index (FDI) which tracks the financial markets through M3, market capitalization and credit amount to residents.

The constructed FCI has a quarterly frequency and is available starting 1998q2. The long-run coefficient of FCI while predicting the real GDP growth is significant at 10 percent. The results confirm that a more-broader index FCI outperforms a narrower index FDI in growth prediction.

By showing that FCI is a better growth predictor than FDI, the study establishes the importance of including the foreign exchange markets, bond markets and stock markets while summarizing the conditions in the economy. The authors hope that the FCI would be helpful to the monetary authorities in their policy decisions.

The paper adds to the few existing studies studies dealing with FCI for Indian economy and constructs a more comprehensive index which tracks multiple markets simultaneously. It also fills the gap in literature by evaluating the correlating relationship between FCI and economic growth.

This study aims to examine the relationship between electricity consumption per capita (ELEC) and real per capita income (Y), as the direction of causation of this relationship remains controversial in the existing literature. It also seeks to explore the relationship between energy consumption per capita (ENC) and real per capita income, over a 34‐year period (between 1975 and 2009).

The study uses Johansen cointegration technique to determine the short‐ and long‐run relationship between the variables. The authors also utilize Granger causality test to determine the causal relationship between the selected variables.

The study provides evidence of bi‐directional causality between the electricity consumption per capita and real per capita income on one hand; and energy consumption per capita and real per capita income on the other hand as the direction of causality has significant policy implications.

This study does not include all dimensions of the energy growth, but is limited to the three variables which the authors consider to be critical to economic development, including energy consumption, electricity consumption and economic growth.

The study uses a sophisticated econometric technique with additional tests of forecasting framework to examine the effect of energy demand on economic growth over a period of the next ten years, i.e. 2010‐2019, in the context of Pakistan. The impulse response describes the reaction of the system as a function of independent variable that parameterizes the dynamic behavior of the system.

This paper investigates the efficiency of the futures market for Brazilian live cattle to predict prices in the spot market of Argentinian steers. The lack of derivatives related to the beef market in the futures exchange in Argentina was the main factor behind the decision to analyse the efficiency of the Brazilian live cattle futures as a predictor of spot prices of Argentinian steers.

We opted to employ the efficient markets hypothesis to approach the question. The hypothesis that futures prices are non‐biased predictors of spot prices is considered to be a true proposition only if the efficient markets hypothesis is not rejected. In methodological terms, the efficiency of the futures market for Brazilian live cattle relative to the spot market of Argentinian steers was verified using the Johansen co‐integration test. A vector error correction model – which enables verification of the question of bias in the prediction of prices, was used to estimate the long‐term equilibrium between spot and futures prices.

The results provided no evidence of bias in the prediction of prices and found the predictive efficiency of the Brazilian live cattle futures market relative to the spot market of Argentinians steers to be approximately 80 per cent. Thus, the future prices of Brazilian live cattle can expressly assist participants in the Argentinian beef production chain to predict the spot prices of steers.

Esse trabalho verifica a eficiência do mercado futuro do boi gordo brasileiro em relação ao mercado a vista dos novilhos argentinos. A ausência de derivativos relacionados ao mercado da carne bovina em bolsa de futuros na Argentina foi o principal aspecto motivador da análise da eficiência do mercado futuro do boi gordo brasileiro como preditordos preços a vista dos novilhos argentinos.

Assim sendo, optou‐se por uma abordagem à luz da teoria da hipótese dos mercados eficientes. A hipótese de que os preços futuros são preditores não viesados dos preços a vista é tida como uma proposição verdadeira somente se a hipótese de eficiência de mercado não for rejeitada. No contexto metodológico, a eficiência do mercado futuro do boi gordo brasileiro em relação ao mercado a vista dos novilhos argentinos foi verificada a partir do teste de cointegração de Johansen, enquanto que o equilíbrio no longo prazo entre os preços a vista e futuros, que possibilita a verificação da questão do viés na predição dos preços, foi estimado por um modelo vetorial de correção de erro.

Os resultados evidenciaram o não viés na predição dos preços e a eficiência do mercado futuro do boi gordo brasileiro em relação ao mercado a vista dos novilhos argentinos de aproximadamente 80%. Logo, os preços futuros do boi gordo brasileiro podem auxiliar de maneira expressiva os agentes da cadeia produtiva da carne bovina argentina na predição dos preços a vista dos novilhos.

The purpose of the paper is to explore the long-run impact of board governance and bank performance on executive remuneration. More specifically, the study addresses two objectives. First, the authors investigate the long-run relationship between pay and performance hold for the Indian banking industry. Second, the authors explore the moderating role of the board in explaining the relationship between executive pay and performance.

The study uses multivariate panel co-integration approaches, i.e. fully modified and dynamic ordinary least square, to explain the co-integrating relationship between executive pay, governance and performance of Indian banks. The analysis is conducted for the period from 2005 to 2018.

The results of co-integration tests reveal a long-run relationship between executive pay, board governance and bank performance. The long-run estimates produce evidence in favour of the dynamic agency theory, suggesting that the implications of asymmetric information can be mitigated by associating the current executive pay with the bank performance in the previous periods. The finding of this study reveals that improvements in the board quality serve as a monitoring tool to constrain excessive pay and moderate the executives’ pay. Furthermore, the interaction of performance and board governance negatively impacts pay, supporting a substitution approach. It implies that setting optimal pay packages for executives necessitates enhanced and efficient board governance practices.

The study recommends significant policy implications for regulators and the board of directors that executive pay significantly responds to the bank’s performance and good board governance practices in the long run.

This paper provides novel evidence of long-run pay-performance-governance relation using a panel co-integration approach.

Vector‐autoregression (VAR), integration, and cointegration models are used to investigate the causal relations, dynamic interaction, and a common trend between interest rates and inflation in nine countries in the Pacific‐Basin. This paper finds that for all countries, short‐ and long‐term interest rates and the spread between the long‐term interest rates and inflation are non‐stationary I (1) processes. The nominal interest rates and inflation are not co‐integrated. In addition to this study’s inability to find a unidirectional causality between inflation and interest rates, when the VAR model is used, it also fails to find a consistent positive response either of inflation to shocks in interest rates or of interest rates to shocks in inflation in most of the countries studied. The VAR model results are consistent with the cointegration tests’ results, that is, nominal interest rates are poor predictors for future inflation in the Pacific‐Basin countries.

The objective of this study is to investigate the impact of selected economic variables on deposits level in the Islamic and conventional banking systems in Malaysia.

Both long‐ and short‐run relationships between these variables are measured by using advanced time series econometrics. These techniques are co‐integration and error correction framework, which are conducted within the vector autoregression framework.

By applying recent econometric techniques, we find determinants such as rates of profit of Islamic bank, rates of interest on deposits of conventional bank, base lending rate, Kuala Lumpur composite index, consumer price index, money supply and gross domestic product have different impact on deposits at both Islamic and conventional banking systems. In most cases, customers of conventional system behave in conformity with the savings behaviour theories. In contrast, most of these theories are not applicable to Islamic banking customers. Therefore, there is a possibility that religious belief plays an important role in the banking decisions of Muslim customers.

As customers are sensitive to rewards, they receive from their deposits, rates of profit of Islamic system must at any time be similar to those of the conventional system. Finally, religious dimension can be considered as an important element to attract more people to deposit their funds in the Islamic system.

To the best of the authors’ knowledge, this is the first attempt to empirically examine the depositor's behaviour in the Islamic banking environment.