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Open Access
Article
Publication date: 13 April 2023

Van Bon Nguyen

The study aims to use individuals using the internet and fixed broadband subscriptions as a proxy for digitalization to empirically assess the effects of Foreign Direct Investment…

1810

Abstract

Purpose

The study aims to use individuals using the internet and fixed broadband subscriptions as a proxy for digitalization to empirically assess the effects of Foreign Direct Investment (FDI), digitalization and their interaction on income inequality in developed and developing countries from 2002 to 2019.

Design/methodology/approach

The paper used the system general method of moments estimators for 30 developed and 35 developing countries.

Findings

FDI increases income inequality in developed countries but decreases it in developing countries, digitalization reduces income inequality in both groups and interaction term narrows income inequality in developed countries but widens it in developing countries.

Originality/value

The paper is the first to introduce digitalization into the FDI – income inequality relationship. Furthermore, it provides empirical evidence to show the difference in the role of digitalization in this relationship between developed and developing countries.

Details

Journal of Economics, Finance and Administrative Science, vol. 28 no. 55
Type: Research Article
ISSN: 2218-0648

Keywords

Open Access
Article
Publication date: 24 October 2022

Sorphasith Xaisongkham and Xia Liu

The main purpose of this research is to examine the impact of institutional quality and sectoral employment on environmental degradation in developing countries. This paper also…

1952

Abstract

Purpose

The main purpose of this research is to examine the impact of institutional quality and sectoral employment on environmental degradation in developing countries. This paper also re-examined the validity of the Environmental Kuznets Curve (EKC) hypothesis and estimated the long run impact of explanatory variables on CO2 emissions.

Design/methodology/approach

In this paper, the balanced panel data for the period 2002–2016 was used based on data availability and applied two-step SYS-GMM estimators.

Findings

The results showed that institutional quality such as government effectiveness (GE) and the rule of law (RL) reduce CO2 emissions and promote environmental quality in developing countries. Interestingly, the authors found new evidence that employment in agriculture and industry has a positive impact on pollution, while employment in the service sector was negatively associated with CO2 emissions, and the validity of the EKC hypothesis was confirmed. In addition, the research suggests that strong institutional frameworks and their effective implementation are the most important panacea and should be treated as a top priority to counteract environmental degradation and achieve the UN Sustainable Development Goals.

Originality/value

This is the first study to examine the short run and long run effects of institutional quality and sectoral employment on environmental degradation using the balanced panel data for a large sample of developing countries. This paper also used a special technique of Driscoll and Kraay standard error approach to confirm the robustness results and showed the different roles of sectoral employment on environmental quality.

Details

International Journal of Emerging Markets, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1746-8809

Keywords

Open Access
Article
Publication date: 22 August 2023

Mohammed Seid Hussen

The main purpose of this study is to examine the impact of different dimensions of institutional quality indices on the economic growth of Sub-Saharan African (SSA) countries.

2045

Abstract

Purpose

The main purpose of this study is to examine the impact of different dimensions of institutional quality indices on the economic growth of Sub-Saharan African (SSA) countries.

Design/methodology/approach

The study uses a panel data set of 31 SSA countries from 1991 to 2015 and employs a two-step system-GMM (Generalized Method of Moments) estimation technique.

Findings

The study's empirical results indicate that investment-promoting and democratic and regulatory institutions have a significant positive effect on economic growth; however, once these institutions are taken into account, conflict-preventing institutions do not have a significant impact on growth.

Practical implications

The study's findings suggest that countries in the region should continue their institutional reforms to enhance the region's economic growth. Specifically, institutions promoting investment, democracy and regulatory quality are crucial.

Originality/value

Unlike previous studies that use either composite measures of institutions or a single intuitional indicator in isolation, the present study has employed principal component analysis (PCA) to extract fewer institutional indicators from multivariate institutional indices. Thus, this paper provides important insights into the distinct role of different clusters of institutions in economic growth.

Details

Journal of Economics and Development, vol. 25 no. 4
Type: Research Article
ISSN: 1859-0020

Keywords

Open Access
Article
Publication date: 25 July 2018

Brian Tavonga Mazorodze and Dev D. Tewari

The purpose of this paper is to establish the empirical link between real exchange rate (RER) undervaluation and sectoral growth in South Africa between 1984 and 2014.

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Abstract

Purpose

The purpose of this paper is to establish the empirical link between real exchange rate (RER) undervaluation and sectoral growth in South Africa between 1984 and 2014.

Design/methodology/approach

The study employs a dynamic panel data approach estimated by the system generalised method of moments technique in a bid to control for endogeneity.

Findings

The authors find a significant positive impact of undervaluation on sectoral growth which increases with capital accumulation. Also, the authors confirm that undervaluation promotes sectoral growth up to a point where further increases in undervaluation retards growth.

Practical implications

The results confirm the importance of policies that keep the domestic currency weaker to foster sectoral growth.

Originality/value

The originality of this paper lies in establishing the impact of exchange rate undervaluation on growth at a sector level in the context of South Africa using a dynamic panel data approach.

Details

African Journal of Economic and Management Studies, vol. 9 no. 4
Type: Research Article
ISSN: 2040-0705

Keywords

Open Access
Article
Publication date: 17 November 2023

Temitope Abraham Ajayi

This study aims to investigate the effects of mineral rents, conflict and population growth on countries' growth, with a specific interest in 13 selected economies in Sub-Saharan…

Abstract

Purpose

This study aims to investigate the effects of mineral rents, conflict and population growth on countries' growth, with a specific interest in 13 selected economies in Sub-Saharan Africa.

Design/methodology/approach

This paper uses a combination of research methods: the pooled ordinary least squares (OLS), the fixed effect and the system generalized method of moment (GMM). The consistent estimator (system GMM), which provides the paper's empirical findings, remedies the inherent endogeneity bias in the model formulation. The utilized panel dataset for the study spans from 1980 to 2022.

Findings

The study suggests that mineral rents positively affect countries' growth by about 0.407 percentage points in the short run. The study further demonstrates the long-run negative impacts of population growth rates and prevalence of civil war on economic growth. The empirical work of the study reveals that an increase in the number of international borders within the group promotes mineral conflicts, which impedes economic growth. Evidence from the specification tests performed in the study confirmed the validity of the empirical results.

Social implications

Mineral rents, if well managed and conditioned on good institutions, are a blessing to an economy, contrary to the assumptions that mineral resources are a curse. The utilization of mineral rents in Sub-Saharan Africa for economic growth depends on several factors, notably the level of mineral conflicts, population growth rates, institutional factors and the ability to contain civil war, among others.

Originality/value

This study is the first attempt in the post-coronavirus disease 2019 (COVID-19) era to revisit the investigation of the impacts of mineral rents, conflict and population growth rates on the countries' growth while controlling for the potential implications of the qualities of institutions. One of the significant contributions of the study is the identification of high population growth rates as one of the primary drivers of mineral conflicts that impede economic growth in the states with enormous mineral deposits in Sub-Saharan Africa. The crucial inference drawn from the study is that mineral rents positively impact countries' growth, even with inherent institutional challenges, although the results could be better with good institutions.

Details

Journal of Economics and Development, vol. 26 no. 1
Type: Research Article
ISSN: 1859-0020

Keywords

Content available
Book part
Publication date: 10 April 2019

Abstract

Details

The Econometrics of Complex Survey Data
Type: Book
ISBN: 978-1-78756-726-9

Open Access
Article
Publication date: 31 August 2012

Yoon Heo and Tran N. Kien

This article examines the impact of the ASEAN Free Trade Area (AFTA) on Korean exports to ASEAN countries by using the system generalized method of moments. The data covered 15…

Abstract

This article examines the impact of the ASEAN Free Trade Area (AFTA) on Korean exports to ASEAN countries by using the system generalized method of moments. The data covered 15 sectors according to their relative importance in Korean exports and spanned from 1980 to 2006. The estimated results suggest that Korea’s exports were diverted to ASEAN members as a result of the AFTA formation. In 5 of the 15 sectors, the AFTA exerted a significant negative effect on Korean exports to ASEAN countries, but for the remaining 9, the results were mixed and statistically insignificant. The results also indicate that the sectoral approach yields more robust and clear-cut results than the aggregate one.

Details

Journal of International Logistics and Trade, vol. 10 no. 2
Type: Research Article
ISSN: 1738-2122

Keywords

Open Access
Article
Publication date: 22 March 2021

Sakiru Oladele Akinbode, Adewale Oladapo Dipeolu, Tobi Michael Bolarinwa and Oladayo Babaseun Olukowi

Some progress have been made over time in improving health conditions in Sub-Saharan Africa (SSA). There are, however, contradicting reports on the relationship between health…

1995

Abstract

Purpose

Some progress have been made over time in improving health conditions in Sub-Saharan Africa (SSA). There are, however, contradicting reports on the relationship between health outcomes and economic growth in the region. The paper aimed at assessing the effect of health outcome on economic growth in SSA.

Design/methodology/approach

Data for 41 countries from 2000 to 2018 were obtained from WDI and WGI and analyzed using system generalized method of moment (sGMM) which is appropriate for the present scenario. AR(1) and AR(2) tests were used to assess the validity of the model while Sargan and Hansen tests were adopted to examine the validity of the instrumental variables. The robustness of the estimation was confirmed using the pooled OLS and fixed effect regression.

Findings

Health outcome (proxied by life expectancy), lagged GDP per capita, capital formation, labor force (LF), health expenditure (HE), foreign direct investment (FDI) and trade openness (TOP) significantly affected economic growth emphasizing the importance of health in the process of economic growth in the region. AR(1) and AR(2) tests for serial correlation and Sargan/Hansen tests confirmed the validity of the estimated model and the instrumental variables respectively. Robustness of the GMM results was established from the pooled OLS and the fixed effect model results.

Social implications

Improvement in the national health system possibly through the widespread adoption of National Health Insurance, increase government spending on healthcare alongside increased beneficial trade and ease of doing business to facilitate investment were recommended to enhance.

Originality/value

The study used up-to-date data with appropriate methodology.

Details

Journal of Economics and Development, vol. 23 no. 3
Type: Research Article
ISSN: 1859-0020

Keywords

Open Access
Article
Publication date: 18 November 2022

Malika Neifar

In this paper, the author assesses if the effect of structural policies, macroeconomic indicators and demographic factors on employment elasticities over the period 2000–2017 can…

Abstract

Purpose

In this paper, the author assesses if the effect of structural policies, macroeconomic indicators and demographic factors on employment elasticities over the period 2000–2017 can distinguish the former French colonies from the Anglophone ones.

Design/methodology/approach

Using a panel of 44 countries taken from Africa and Middle East Area, elasticities are estimated in the first stage by rolling regression. Then, both static and dynamic panel models are investigated.

Findings

Results suggest big difference between the former French colonies and Anglophone ones. For the French colonies, product and labor market flexibility are found to have significant and positive impact on elasticities, while for Anglophone ones, only foreign direct investment and government size are found to have significant and positive impact. Besides, all reforms and/or economic measures need to be complemented by macroeconomic policies aimed to increase economic stability.

Originality/value

The results presented in this study highlight some of the factors that appear to drive the relationship between employment and some structural policies, macroeconomic indicators and demographic factors for two groups of former colonies. The paper provides policy conclusions based on these results for the two groups. This analysis may indeed help to inform future policy discussions, yet much additional work is needed to identify macroeconomic “best practices” for encouraging employment in the post-2019 covid crisis period.

Open Access
Article
Publication date: 8 June 2021

Shafiu Ibrahim Abdullahi

The purpose of the study is to measure cross-country stock market correlation and volatility transmission during the global coronavirus disease 2019 (COVID-19) pandemic. The paper…

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Abstract

Purpose

The purpose of the study is to measure cross-country stock market correlation and volatility transmission during the global coronavirus disease 2019 (COVID-19) pandemic. The paper traces trajectory of Islamic equity investments in order to get insights on the behavior of the markets during the crisis.

Design/methodology/approach

The paper uses generalized method of moments (GMM), autoregressive distributed lag (ARDL) and multivariate GARCH (MGARCH) models for analysis of dynamic causality, stock market cointegration, correlation and volatility transmission between Islamic stock indices.

Findings

The result of normal correlation analysis on the share indices show the markets move together. The result of ARDL cointegration test shows the markets returns are cointegrated as a group. To further make sense of the data; the indices were grouped into four different categories, then cointegration tests were conducted. The results of the analysis show that the subgroups are cointegrated except the low COVID-19 subgroup. Based on MGARCH findings, the possibility of volatility transmission between markets during the crisis is high. The market returns indices show the usual herd mentality common during the period of crisis.

Originality/value

Unlike other works in this area, this paper attempt to trace the trajectory of Islamic equity investment in order to get relevant insights and arrives at appropriate ways of responding to the crisis.

Details

Islamic Economic Studies, vol. 29 no. 1
Type: Research Article
ISSN: 1319-1616

Keywords

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