Search results

This paper explores the evidence of a long-run co-movement between aggregate unemployment insurance spending and the labor force participation rate in the USA. The unemployment insurance (UI) program tends to expand during an economic downturn and contract during an expansion. UI may incentivize unemployment and may also facilitate better matching in the labor market. Statistical evidence of the presence of a co-movement will thus shed new light on their dynamics.

This research applies time-series econometric approach using monthly data from 1959:1 to 2020:3 to test threshold cointegration and estimate a threshold vector error-correction (TVEC) model. The estimates from the TVEC model investigating the nature of short-run dynamics.

The Enders and Siklos (2001) test find evidence of threshold cointegration between the two indicating the presence of long-run co-movement. The estimates from the TVEC model investigating the nature of short-run dynamics find evidence that the growth in aggregate UI spending and the growth in labor force participation rate adjust simultaneously to maintain the long-run co-movement above the threshold in the short run. The author also observes the same short-run dynamics for the growth in aggregate UI spending and the growth in the labor force participation rate for females.

This model is bi-variate by construction and does not address causality.

The author argues that the UI program positively impacts the female labor market outcomes, for example, better matching. This finding may explain the upward trend in the labor force participation rate for females in the USA.

The research findings may justify the transfer programs for minority and immigrants.

This is first research that analyzes the UI programs impact on the labor force participation using a macroeconometric approach. To the best of the author's knowledge, this is the first study in this genre.

The authors test the effect of expenditure decentralization and fiscal equalization on short- and long-run economic growth and estimate two-step generalized method of moment (GMM) simultaneous equations models, using panel data for China and India for the period 1985 to 2005. The authors estimate two simultaneous equations: a growth equation and equalization equation and find that expenditure decentralization has a negative and statistically significant effect at conventional levels on short-run economic growth for both China and India. However, the authors also find that this result is sensitive to the set of included explanatory variables. This leads the authors to conclude that expenditure decentralization has no effect on short-run economic growth for either country. The authors also find that expenditure decentralization has a positive and statistically significant effect on fiscal equalization for both countries but find no evidence that fiscal equalization affects short-run economic growth for either China or India. In contrast, the authors find that expenditure decentralization has a positive effect on long-run economic growth in the case of India, but not in the case of China. Finally, the authors report evidence that fiscal equalization has no effect on long-run economic growth in the case of China; however, the authors find that equalization has a positive and statistically significant at conventional levels effect on long-run economic growth in India.

The authors estimate two-step GMM simultaneous equations models, using panel data for China and India for the period 1985 to 2005. To examine the effect of fiscal decentralization (FD) policies on economic growth in China and India, the authors estimate two equations: a growth equation and an equalization equation. For the growth equation, the authors adopt a production-function-based model that is widely used in the empirical literature on growth; however, the authors do make some compromises with this specification due to the unavailability of certain data. For the equalization equation, the authors include variables that economic theory and empirical evidence suggest influence fiscal disparities among subnational governments which in turn influence the demand for horizontal fiscal equalization (HFE). To the extent possible, the authors employ the same econometric specification, variable constructions and sample periods for both China and India. The authors believe this strategy provides a more rigorous test of the FD hypothesis.

The authors find that expenditure decentralization has a negative and statistically significant effect at conventional levels on short-run economic growth for both China and India. However, the authors also find that this result is sensitive to the set of included explanatory variables. This leads to conclude that expenditure decentralization has no effect on short-run economic growth for either country. The authors also find that expenditure decentralization has a positive and statistically significant effect on fiscal equalization for both countries but find no evidence that fiscal equalization affects short-run economic growth for either China or India. In contrast, the authors find that expenditure decentralization has a positive effect on long-run economic growth in the case of India, but not in the case of China. Finally, the authors report evidence that fiscal equalization has no effect on long-run economic growth in the case of China; however, the authors find that equalization has a positive and statistically significant at conventional levels effect on long-run economic growth in India.

Due to the importance of FD policies, especially to many developing countries that are currently pursuing decentralization reforms, future research should examine the effect of FD on economic growth for other countries. Furthermore, although it would be difficult to do so, future research should examine whether FD promotes political stability on ethnically diverse countries.

To the best of the authors’ knowledge, no one has examined the effect of FD policies on India's growth experience. What is more is that this is also the first of its kind to have a comprehensive empirical investigation into these two major developing countries with very interesting similarities and differences in FD policies. It is thus of great importance to examine the effect of expenditure decentralization and HFE on economic growth in China and India.

The purpose of this paper is to present a comprehensive analysis of the carbon footprint of the Delft University of Technology (TU Delft), including direct and indirect emissions from utilities, logistics and purchases, as well as a discussion about the commonly used method. Emissions are presented in three scopes (scope 1 reports direct process emissions, scope 2 reports emissions from purchased energy and scope 3 reports indirect emissions from the value chain) to identify carbon emission hotspots within the university’s operations.

The carbon footprint was calculated using physical and monetary activity data, applying a process and economic input-output analysis.

TU Delft’s total carbon footprint in 2018 is calculated at 106 ktCO₂eq. About 80% are indirect (scope 3) emissions, which is in line with other studies. Emissions from Real estate and construction, Natural gas, Equipment, ICT and Facility services accounted for about 64% of the total footprint, whereas Electricity, Water and waste-related carbon emissions were negligible. These findings highlight the need to reduce universities’ supply chain emissions.

A better understanding of carbon footprint hotspots can facilitate strategies to reduce emissions and finally achieve carbon neutrality. In contrast to other work, it is argued that using economic input-output models to calculate universities’ carbon footprints is a questionable practice, as they can provide only an initial estimation. Therefore, the development of better-suited methods is called for.

Over the past 20 years, China's infrastructure has developed at an extraordinary speed. The current literature mainly focuses on the effects of political incentives on the infrastructure. However, this paper indicates that the structural change of China's land regime is an important clue and that the supernormal development of China's infrastructure is an explicable result for that.

This paper theoretically proves that in a politically centralized and economically decentralized economic entity with a public land-ownership regime, the self-financing mechanism formed by local officials through regulation of the land-grant price is the primary factor that influences the optimal supply volume of infrastructure in a region, in addition to political and economic incentives, and whether the self-financing mechanism can be formed or not depends on the structure of a country's land regime, which can help to explain the difference between the development of infrastructure in China and that in other developing countries from a theoretical angle.

The paper suggests that the mode is facing an important transformation toward land reform and new-type urbanization construction, and the replication and promotion of China's experience in infrastructure construction are of further significance under the Belt and Road Initiative as it provides a method for helping developing countries to eliminate infrastructure bottlenecks.

Through the test of multinational panel data, the paper indicates that the structural change of China's land regime around 1990 had an overall effect on the supernormal development of infrastructure in China. The paper indicates that the “land-based development mode” of China's infrastructure indeed contributed to the supernormal development of infrastructure in China, but there are still some shortcomings in this mode.

This paper examines the political budget cycles in emerging and developing countries using a sample of 91 countries from 1992 to 2019.

This paper employs a pooled ordinary least squares (OLS) model with clustered standard errors at the country level. To address endogeneity issues, the authors also employ a two-step system generalized methods of moments model.

The authors find clear evidence of political budget cycles in emerging and developing countries. The authors consistently find that incumbents increase total government spending, particularly in economic affairs, public services and social welfare, in the year before an election and the election year. In contrast, they contract spending in the year after an election.

Policymakers should be aware of the political budget cycles during election years. Promoting control of corruption and democracy helps to alleviate the effects of the political budget cycles in emerging and developing countries.

The authors are among the first to explore the political budget cycles in emerging and developing countries by focusing on the total government spending and its main compositions, including expenditures on economic affairs, public services and social welfare. Besides, the authors also explore the conditioning effects of control of corruption, political ideology and democracy.

The purpose of this paper is to examine the impacts of fiscal policy, namely, net tax and government expenditure on national saving and its nonlinearity. The author first investigates whether the impacts of fiscal policy on national saving have changed after the global financial crisis of 2008. Then, the author tests the nonlinearity of the relationship by taking account of the economic cycle, namely, economic expansion (boom) and economic recession (bust).

The empirical model bases on a reduced-form equation with national saving as a dependent variable, lagged value of national saving, output gap and fiscal policy as independent variables. The two-step system GMM approach was employed to estimate the empirical model, using a panel of 23 emerging Asian economies in the period of 1990-2015.

The empirical results show that tax policy and expenditure policy follow the predictions of the overlapping generation model with finite horizon and the Keynesian view. The nonlinearity of fiscal policy is twofold. The conduct of fiscal policy in the period after 2008 seems effective, while the effect is insignificant in the period before 2008. Likewise, fiscal policy tends to have more significant effects in bust cycle. The effect of tax policy is increased during recession, while the effect of government spending is more pronounced during economic downturn.

The contributions of this paper are twofold. First, it is shown that fiscal policies in the region had more impacts on national saving after the global financial crisis of 2008. Second, the research confirms nonlinear impact of fiscal policy on saving behavior during economic recession and economic boom.

The purpose is to market a reinterpretation of Brazilian economic history highlighting the importance of non-tradable goods to understand major historical developments such as the lack of industrialization in the mining boom; the rise and contribution of industries to development in the early 20th century; indexation as hyperinflation in the late 20th century; growth and cycles in the early 21st century.

Section 2 introduces analytical perspectives on the relationship between non-tradables, transport costs and external shocks. Section 3 presents a historical overview of the gold and coffee cycles in the Brazilian economy, which highlights the crucial role played by transport costs in the genesis of industrialization. Thus, in a more precise way, industrialization was not an import substitution process but the substitution of non-tradables by the domestic tradable manufactures.

Section 4 shows that Brazilian statistical records and historiography disregard this characterization and, to that extent, underestimate economic growth in the primary export phase (1872–1920) and overestimate growth rates in the industrialization period (1920–1940). Section 5 shifts to the end of the 20th century to analyze the relationship between non-tradables, indexation and hyperinflation. Section 6 concludes with a brief discussion of the role played by the terms of trade and non-tradables in the unfolding of the 2014 economic crisis.

Distance from international markets and a continental geographic size made transport costs in Brazil historically prohibitive: the relevance of non-tradables in the Brazilian economic history. While the theme is not new, it seldom received proper attention in the historiography.

Microbusinesses are better able to assist many disadvantaged groups in finding employment and breaking the cycle of poverty because they require less initial capital and employ a large number of poor people in developing economies. Women run and own the majority of micro-businesses in urban Ethiopia. This study aims to investigate women’s microbusiness participation decisions and the effect on poverty in the Wolaita zone southern Ethiopia.

A cross-sectional study was carried out using a mixed-methods research approach. A total of 384 women who owned micro-businesses were chosen using a systematic random sampling technique, while 36 women were purposefully chosen for qualitative data analysis. Data were gathered through survey questionnaires, in-depth interviews and focus group discussions. The collected data were analyzed by using a propensity score matching technique as well as contextual analysis.

The study discovered that women’s participation in registered micro-businesses had a higher and more beneficial impact on their food, non-food and overall consumer spending than women’s participation in unregistered microbusinesses, which helped to reduce poverty. Besides, overall women’s participation in micro-business increased their decision-making power and enabled them to provide resources for their families food and non-food consumption, with registered micro-business participants reaping the greatest benefits.

This research focused on the effects of women’s micro-entrepreneurship on poverty in low-income communities. Rather than providing food, clothing and/or other aid to women in disadvantaged communities, the authors asserted that assisting women and their micro-businesses allows them to be self-sufficient in terms of food and clothing as a long-term solution to poverty reduction. As a result, policymakers can use our findings to gain a better understanding of how women’s micro-entrepreneurship affects poverty reduction, allowing them to develop more effective anti-poverty initiatives. This study’s findings are novel and add to the body of knowledge in Ethiopia and the sub-Saharan African region.