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Entrepreneurial activity is a phenomenon that increases the economic growth of countries and improves their social welfare. The economic development levels of countries have significant effects on these entrepreneurial activities. This research examines which institutional and macroeconomic variables explain early-stage entrepreneurship activities in developed and developing economies.

The authors conducted panel data analysis on the data from the Global Entrepreneurship Monitor (GEM) and International Monetary Fund (IMF) surveys covering the years 2009–2018.

First, the authors' results reveal that cognitive, normative and regulatory institutions and macroeconomic factors affect early-stage entrepreneurial activity in developed and developing countries differently. Second, the authors' findings indicate that cognitive, normative and regulatory institutions affect early-stage entrepreneurship more positively in developed than developing countries. Finally, the authors' results report that macroeconomic factors are more effective in early-stage entrepreneurial activity in developing countries than in developed countries.

This study provides a better understanding of the components that help explain the differences in entrepreneurship between developed and developing countries regarding institutions and macroeconomic factors. In this way, it contributes to developing entrepreneurship literature with the theoretical achievements of combining institutional theory and macroeconomic indicators with entrepreneurship literature.

This paper aims to study the impact of economic freedom and some key macroeconomic variables on the foreign direct investment (FDI) inflow in Brazil.

An econometric model is developed that includes FDI inflow as the dependent variable and macroeconomic variables such as the output, current account balance, the real exchange rate, openness and economic freedom as explanatory variables. Annual time series data from 1995 to 2022 is used. Before carrying out the estimation, the time series properties of the data are diagnosed using unit root tests and cointegration tests. Since the data series were found to be stationary in the first difference form and the variables in the model were cointegrated, an error correction model is developed and estimated.

The findings demonstrate that the size of the market (gross domestic product), current account balance and the economic freedom index significantly influence FDI inflow to Brazil. Although the signs of openness and the real exchange rate align with theoretical expectations, they do not attain statistical significance.

To the best of the authors’ knowledge, this is the first formal study on the impact of economic freedom on the FDI inflow in Brazil. The finding of this study adds value to the understanding of FDI dynamics in Brazil, highlighting the critical role of economic freedom and market size in attracting foreign investment.

The purpose of this study is to examine two issues, namely the degree of current account deficit (CAD) sustainability and the degree of capital mobility.

The sample for this study comprises 24 Latin American and Caribbean countries, including three regional agreements: Andean Community, MERCOSUR (Mercado Común del Sur), and SICA (Central American Integration System). This study employs the dynamic common correlated effects mean group (DCCEMG) estimator in a panel data set to investigate the long-run relationship between savings and investment along with short-run dynamics.

The findings indicate that CAD is weakly sustainable in the Latin American and Caribbean region, MERCOSUR, and SICA, while CAD is strongly unsustainable in the Andean Community. The sub-period analysis reveals that CAD has been adversely affected by the 2008 crisis. However, in the post-crisis period, CAD has been slowly decreasing in the Latin American and Caribbean region and Andean Community, whereas CAD has continued increasing in MERCOSUR and SICA. Further, the estimates of error-correction terms and short-run coefficients indicate that the Andean Community and MERCOSUR observe a higher degree of long-run and short-run capital mobility than SICA.

The results carry fundamental implications for policy-making processes aimed at maintaining sustainable CADs.

This study gives an alternative interpretation of the “Feldstein-Horioka” coefficient in terms of CAD sustainability and analyses the saving–investment relationship in light of Chudik and Pesaran (2015).

This study aims to assess the nexus among oil price (OP), renewable energy consumption (REC) and trade balance (TB) for India using annual time series data for the time period 1985–2019. In particular, the authors examine whether REC improves India's TB in the context of high oil import dependence.

The study uses autoregressive distributed lags (ARDL) bound testing approach that has the advantage of yielding estimates of long-run and short-run parameters simultaneously. Moreover, the small sample properties of this approach are superior to other multivariate cointegration techniques. Fully modified ordinary least square (FMOLS) and dynamic ordinary least squares (DOLS) are also applied to test the robustness of the results. The causality among the series is investigated through block exogeneity test based on vector error correction model.

The findings based on ARDL bounds testing approach indicate that OPs exert a negative impact on TB of India in both long run and short run, whereas REC has a favorable impact on the TB. In particular, 1% increase in OPs decreases TBs by 0.003% and a 1% increase in REC improves TB by 0.011%. The results of FMOLS and DOLS corroborate the findings from ARDL estimates. The results of block exogeneity test suggest unidirectional causation from OPs to TB; OPs to REC and REC to TB.

The study underscore the importance of renewable energy as a potential tool to curtail trade deficits in the context of Indian economy. Our results suggest that the policymakers must pay attention to the hindrances in augmentation of renewable energy usage and try to capitalize on the resulting gains for the TB.

Climate change is a major challenge for developing countries like India. Renewable energy sector is considered an important instrument toward attaining the twin objectives of environmental sustainability and employment generation. This study underscores another role of REC as a tool to achieve a sustainable trade position, which may help India save her valuable forex reserves for broader objectives of economic development.

To the best of the authors’ knowledge, this is the first study that probes the dynamic nexus among OPs, REC and TB in Indian context. From a policy standpoint, the study underscores the importance of renewable energy as a potential tool to curtail trade deficits in context of India. From a theoretical perspective, the study extends the literature on the determinants of TB by identifying the role of REC in shaping TB.

Czechia is a small open economy and a member state of the European Union. Several important trends and episodes that have determined economic growth can be identified over the last two decades. This chapter deals with some macroeconomic features like macroeconomic and labour market performance within the business cycle, the Czech National Bank (CNB) exchange rate commitment and interest rate policy, increasing indebtedness and budget deficits, foreign trade and the international investment position. We applied publicly available data from Eurostat, the Organisation for Economic Co-operation and Development and CNB databases. The data show that the Czech economy was significantly converging to the average economic level of the European Union. We also identified key turning points in business cycles. Macroeconomic data on economic development of the economy indicate an atypical course of the business cycle between 2020 and 2022, which can be evaluated as different from the one that followed the global financial crisis.

The purpose of this research is to study the relationship between exchange rate fluctuations and stock market returns of the seven highest economic performing emerging countries (E7).

The study is conducted using the daily data for exchange rates and stock market returns in each of the E7 countries from January 1, 2019, to January 1, 2022. The study employs the ordinary least squares, autoregressive distributed lag error correction regression and generalized autoregressive conditional heteroskedasticity (GARCH (1,1)) regression models to fully investigate the impact of exchange rate on stock markets. For further investigation, the GARCH (1,1) model is run twice for each country with and without the inclusion of exchange rate to determine its effect on the volatility of stock returns.

The findings support the presence of cointegration relationship between the variables for all countries. The results reveal significant positive long-run relationship between exchange rates and stock market returns in all countries except for Indonesia, which evidenced a significant negative impact. The results of the GARCH (1,1) add that the inclusion of exchange rate in the model accounts for a slight change in the volatility of stock returns.

The research provides empirical evidence that appreciating currencies are perceived positively by investors leading to better performing capital markets. The outcomes of this study may assist policy makers in understanding to what degree changes in exchange rates can influence capital markets, as well as narrow the gap in literature regarding which theory is more relevant in explaining how exchange rate fluctuations impact market values.

The aim of the paper is to determine the asymmetric impact of tourism on the deficit in the balance of payments (BOPs).

The research uses the non-linear autoregressive distributed lag (ARDL) model to investigate the asymmetric impact of tourism on Pakistan's BOPs deficit using quarterly data from 1995 to 2019.

The finding reveals that due to the positive change in tourism, the BOPs deficit decreases by 27%, although due to the negative change in tourism, the BOPs deficit rises by 2.3%. In addition, the significance of F-statistics (10.609) confirms the existence of co-integration between tourism and the deficit in the BOPs. The Wald test confirms the asymmetric association between tourism and the deficit in the BOPs over the long term.

In order to improve tourism in Pakistan, policymakers must consider the following implications. First, there is a need for an adequate infrastructure that can help the tourist. Second, the Government must maintain a stable law and order situation as a whole and particularly at tourist destinations. Finally, the Government should develop tourism-friendly policies in order to boost tourism in Pakistan.

The research provides new evidence of the impact of tourism on the BOPs using the novel non-linear ARDL (NARDL) technique. The evidence will help policymakers to develop policies to improve tourism in order to reduce the BOPs deficit.

The purpose of this study is to empirically investigate the asymmetric effects of financial risk on Sukuk market development for a sample of Malaysian countries over the period of 2010–2021.

This study refers to the International Country Risk Guide (ICRG) in determining the financial risk factors to be studied in addition to the Malaysia financial stress index (FSI) to capture changes in financial risk level. The authors use the nonlinear autoregressive distributed lag (NARDL) model to tackle the nonlinear relationships between identified financial risk variables and Sukuk market development.

The results suggest the existence of a long-run relationship between foreign debt service stability, international liquidity stability (ILS), exchange rate stability (ERS) and financial stress level with the Sukuk market development in Malaysia. Indeed, higher ILS and ERS will boost Sukuk market size, whereas higher foreign debt services and financial stress are negatively related to Sukuk market development. Findings also indicate that the long-run positive and negative impacts of identified financial risk components on Sukuk market development are statistically different. Taking into account the role of the Sukuk market in facilitating Malaysia’s economic growth, the country should aim to keep the foreign debt-to-GDP ratio at a sustainable level.

This study points to three possible directions for future research. The first is the differential impact of financial risk components on Sukuk issuance for different Sukuk structures. As more data becomes available in the future, this area could be further explored by conducting the above analysis for different combinations of Sukuk structures and currency denominations. In addition, future researchers could also consider exploring the variability of financial risk impacts through comparative studies of the leading Sukuk-issuing countries to account for differences in regulatory frameworks and supporting infrastructure.

This study provides valuable practical and policy implications for strengthening the growth of the Sukuk market. While benefiting from the diversification benefits of funding sources to finance private or government projects and developments, Malaysia should remain vigilant to global economic conditions, foreign exchange markets and financial stress levels, as all of these factors may significantly influence investor sentiment and the rate of return offered by Sukuk issuance.

The use of the NARDL approach, which investigates the long-run effects of financial risk factors on Sukuk market development in Malaysia, makes this study a valuable addition to the literature, as there has been little research into the asymmetric effects of those variables on Sukuk market development using samples from emerging Asian markets.

This article examines if the national productions of West African Economic and Monetary Union (WAEMU) countries can be substituted for the imports by testing MLRC in these countries.

The Mundell–Fleming model (MMF) is the analytical framework adopted in this paper with import demand and export supply functions estimation borrowed to Thirlwall (1979). This study covers four countries in West Africa from 1990 to 2021. The estimation procedure used is an Autoregressive Distributed Lag (ARDL) approach to cointegration.

The findings reveal that there is a strong marginal propensity to import in the WAEMU countries. The hypothesis of a non-significant price effect on imports in the short-term is confirmed for several countries while only Togo satisfies the MLRC in the short and long run.

This study presents several originalities: (1) it evaluates MLRC with a clear analytical framework; (2) unlike other studies, this article quantifies the MLRC from a theoretical, econometric and empirical point of view; (3) this article presents the results country by country in order to reveal heterogeneity between countries; (4) this study adds to the Marshall–Lerner condition for the derivation of Robinson by considering a situation where initially the trade balance is not in equilibrium.

This study is the first that aims to investigate international transmission channels of sovereign risk among G20 and explore its influential factors by applying the multidimensional SAR model.

Multiple spatial weight matrices can capture the contiguity of spatial units from various dimensions, which could be exploited to improve the precision of inference as well as prediction accuracy. To the best of the authors’ knowledge, this is the first study to investigate international transmission channels of sovereign risk among G20 and explore its influential factors by applying the multidimensional SAR model.

With network structure analysis, this study finds that they contain different information content from the perspective of graphical display, node strength and correlation. Developed and emerging countries all play major roles in trade connection, while only developed countries play major roles in financial linkage. Second, by applying the multidimensional SAR model, only the spatial autocorrelation coefficients for trade and financial linkages are significant during the full sample period, which is in sharp contrast to published studies using the SAR model with a single matrix. Third, the spillover channels that play major roles in various periods are different. Only trade channel plays a role during crisis periods and it is the most important. Fourth, the spatial correlation among countries greatly amplifies the shock’s impacts on one market. And spatial effect for developed countries is larger than those for emerging countries, while the mean spatial effect of a unit shock in the USA on emerging countries is slightly greater than that on developed countries.

Multiple spatial weight matrices can capture the contiguity of spatial units from various dimensions, which could be exploited to improve the precision of inference as well as prediction accuracy. To the best of the authors’ knowledge, this is the first study to investigate international transmission channels of sovereign risk among G20 and explore its influential factors by applying the multidimensional SAR model.