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This chapter revisits the Hausman (1978) test for panel data. It emphasizes that it is a general specification test and that rejection of the null signals misspecification and is not an endorsement of the fixed effects estimator as is done in practice. Non-rejection of the null provides support for the random effects estimator which is efficient under the null. The chapter offers practical tips on what to do in case the null is rejected including checking for endogeneity of the regressors, misspecified dynamics, and applying a nonparametric Hausman test, see Amini, Delgado, Henderson, and Parmeter (2012, chapter 16). Alternatively, for the fixed effects die hard, the chapter suggests testing the fixed effects restrictions before adopting this estimator. The chapter also recommends a pretest estimator that is based on an additional Hausman test based on the difference between the Hausman and Taylor estimator and the fixed effects estimator.

The purpose of this paper is multifold. First, it is to investigate the relationship between social network sites (SNSs) usage and youth's school absenteeism. Second, it is to identify causal relationship between SNSs usage and absenteeism. Third, it is to explore whether SNSs usage causally affects youth's study–work choice after leaving high school. In addition to SNSs usage in general, abnormal SNSs usage is further discussed.

The Longitudinal Study of Australian Children (LSAC) data are utilised. Lagged variable analysis is used to alleviate reverse causality. Instrumental variable approach and the Lewbel method are used to identify causality. Random effects panel data approach (without and with IVs) is additionally applied to increase efficiency and account for individual-specific effects. Random effects approach allowing for within and between effects is applied, enabling us to control for fixed effects. The primary instrument is a dummy indicating whether a youth more often communicates with close friend electronically or face-to-face.

Using SNSs leads to significantly higher probability of a teenager being late for school, skipping class and having trouble not following school rules. The effect is more consistent regarding abnormal SNSs usage, compared to SNSs usage in general. Additionally, SNSs usage decreases the probability of a youth studying after 18 years old, even after controlling for absenteeism.

The findings in this paper highlight the importance of preventing youth (e.g. via enabling children-safe mode or setting up maximum daily access time) from overusing SNSs.

With the transition to hybrid (mixing remote and face-to-face) learning during and after COVID-19, online interactions are becoming inevitable in students' learning. The findings in this paper indicate that usage, especially abnormal usage, of SNSs increases the probability of absenteeism call for attention from stakeholders including teachers, parents and youth themselves.

This paper provides the first causal and longitudinal evidence linking SNSs usage to absenteeism and youth labor outcomes.

The purpose of this study is to verify all factors that promote renewable energy (RE) consumption. Past studies have shown that financial development (FD) and economic growth (EG) are the major drivers toward RE development, while oil prices had mixed outcomes in different regions by different studies.

Global warming effects have been the major reason of the transition by nations from fossil fuel use to RE sources that are considered as friendly to the environment. This research uses the fixed effects and random effects techniques, to ascertain the factors which impact RE development. The generalized linear model is also used to check the robustness of the Fixed Effects and Random Effects models’ results, while the Kao, Pedroni and Westerlund tests are used to check cointegration in the specified model.

The major findings of this study show the importance of EG and FD in promoting RE development. Oil prices, inflation rate and public sector credit present a negative effect on RE development, while foreign direct investment does not significantly impact RE development.

This research recommends the use of FD in promoting RE sources, as well as the stabilization of oil prices and consumer prices.

This research is important because it specifies the three proxies of FD, together with foreign direct investment inflation rate, EG and oil prices, in modeling RE. By investigating the impact of oil prices on RE in the emerging seven economies, this research becomes one of the few studies done in this region, as per the authors’ knowhow.

Foreign Direct Investment (FDI) is an important means of boosting the agricultural sectors of developing economies. The first necessary step to formulate effective public policies to encourage agricultural FDI inflow to a host country is to develop a comprehensive understanding of the main determinants of FDI inflow to the agricultural sector, which is the main objective of the present study.

In view of this, we take a comprehensive approach to exploring the macroeconomic and institutional determinants of FDI inflow to the agricultural sector by examining a large panel data set on agricultural FDI inflows of 37 countries, investigating both groups of developed and developing countries, incorporating a large list of potentially relevant macroeconomic and institutional variables, and applying panel-data econometric models and estimation structures, including pooled, fixed-effects and random-effects regression models.

The general pattern of our findings implies that the degree of openness of an economy has a negative effect on FDI inflows to agricultural sectors, suggesting that the higher the degree of openness in an economy, the lower the level of agricultural protection against foreign trade and imports, and thus the less incentive for FDI to inflow to the agricultural sector of the economy. Additionally, our results show that economic growth (as an indicator of the rate of market-size growth in the host economy) and per-capita real GDP (as an indicator of the standard of living in the host country) are both positively related to FDI inflows to agricultural sectors. Our other results suggest that agricultural FDI tends to flow more to developing countries in general and more to those with higher standards of living and income levels in particular.

FDI inflow has not received much attention with respect to the identification of its main determinants in the context of agricultural sectors. Additionally, there are very few panel-data studies on the determinants of FDI, and even more surprisingly, there are no such studies on the main determinants of FDI inflow to the agricultural sector. We have taken a comprehensive approach by studying FDI inflow variations across countries as well as over time.

Globalization occupies a central research activity and remains an increasingly controversial phenomenon in economics. This phenomenon corresponds to a subject that can be criticized through its impact on national economies. On the other hand, the world economy is evolving in a liberalized environment in which foreign direct investment plays a fundamental role in the economic development of each country. The advent of financial flows – FDI, remittances and official development assistance – can be a key factor in the development of the economy. The subject of this article is to analyses the effect of financial flows on economic growth in developing countries. Empirically, different approaches have been employed. As part of this work, an attempt was made to use a panel data approach. The results indicate ambiguous effects and confirm the results of previous work.

The authors seek to study the effect of foreign direct investment, remittances and official development assistance (ODA) and some control variables i.e. domestic credit, life expectancy, gross fixed capital formation (GFCF), inflation and three institutional factors on economic growth in developing countries by adopting the panel data methodology. Then, the authors will discuss empirical tests to assess the econometric relevance of the model specification before presenting the analysis of the results and their interpretations that lead to economic policy implications. As part of this work, the authors have rolled panel data for developing countries at an annual frequency during the period from 1990 to 2016. In a first stage of empirical analysis, the authors will carry out a technical study of the heterogeneity test of the individual fixed effects of the countries. This kind of analysis makes it possible to identify the problems retained in the specific choice of econometric modeling to be undertaken in the specificities of the panel data.

The empirical results validate the hypotheses put forward and indicate the evidence of an ambiguous effect of financial flows on economic growth. The empirical findings from this analysis suggest the use of economic-type solutions to resolve some of the shortcomings encountered in terms of unexpected effects. Governments in these countries should improve the business environment by establishing a framework that further encourages domestic and foreign investment.

In this article, the authors adopt the panel data to study the links between financial flows and economic growth. The authors considered four groups of countries by income.

The purpose of this paper is to investigate the influence of macroeconomic cyclical indicators and country governance on bank non-performing loans in African countries.

Data was collected from the 53 African countries covering 2005–2021. The paper develops an empirical model to examine the impact of country governance in reducing macroeconomic cycle-induced adverse effects on bank credit risk. This research estimates Random Effects models and the General Method of Moment to examine the link between microeconomic and governance factors on bank non-performing loans. Stata version 15.1 was used to conduct panel regression analysis.

The findings of the study revealed that the generalized method of moments findings contributes valuable insights into the persistence of NPLs over time and the specific effects of variables on NPL levels. The study findings highlight that the debt-to-GDP ratio, unemployment, regulatory quality, government effectiveness and inflation have significant relationships with NPLs, shedding light on their specific contributions to credit risk dynamics.

The focus on a specific set of determinants for NPLs, which may not capture all the factors that influence NPL levels. Thus, the study did not consider the impact of macroeconomic shocks, such as natural disasters or global economic crises, which can have a significant impact on NPLs.

Policymakers should prioritize maintaining sustainable debt levels, promoting employment growth and controlling inflation rates to mitigate credit risk and reduce nonperforming loans. Also, enhancing regulatory quality and government effectiveness is crucial in ensuring financial stability and minimizing non-performing loans in Africa.

This paper provides a new possible solution to minimise bank non-performing loans risk by examining interactions of country governance regarding the macroeconomic cycle behaviour.

The peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-11-2022-0729

This paper aims to unravel the impact of post-pandemic COVID-19 on foreign direct investment (FDI) and its determinants in the South Asian Association for Regional Cooperation (SAARC) Countries.

The study utilized four macroeconomic variables includes growth domestic product growth rate (GDPG), inflation rate (IR), exchange rate (ER), and unemployment rate (UR) to assess their impact on post-pandemic FDI, along with two variables control of corruption (CC) and political stability (PS) to measure the influence of good governance. Random effects, fixed effects, cluster random effects, cluster fixed effects and generalized method of moments (GMM) models were applied to a balanced panel dataset comprising eight SAARC countries over the period 2010–2021. To identify the random trend component in each variable, three renowned unit root tests (Levin, Lin and Chu LLC, Im-Pesaran-Shin IPS and Augmented Dickey-Fuller ADF) were used, and co-integration associations between variables were verified through the Pedroni and Kao approaches. Data analysis was performed using STATA 17 software.

The major findings revealed that the variables have an order of integration at the first difference I (1). Nonetheless, this situation suggests the possibility of a long-term link between the series. And the main results of the findings show that the coefficients of GDPG, CC and PS are positive and significant in the long run, showing that these variables boosted FDI inflows in the SAARC region as they are significantly positively linked to FDI inflows. Similarly, the coefficients of UR, IR, ER and COVID-19 are negative and significant.

By identifying the specific impacts of the post-pandemic FDI and its determinants, governments and policymakers can formulate targeted policies and measures to mitigate the adverse effects and enhance investment attractiveness. Additionally, investors can gain a deeper understanding of the risk factors and adapt their strategies accordingly, ensuring resilience and sustainable growth. Finally, this paper adds value to the literature on the post-pandemic impact on FDI inflows in the SAARC region.

This paper is the first attempt to trace the impact of COVID-19 on Foreign Direct Investment and its determinants in the SAARC Countries. Most of the previous studies were analytical in nature and, if empirical, excluded some countries due to the unviability of the data set. This study includes all the SAARC member countries, and all variables' data are completely available. There is still a lack of empirical studies related to the SAARC region; this study attempts to fill the gap.

The purpose of this study is to investigate the relationship between fiscal policy (tax revenues and government expenditure) and economic happiness. The panel data are used from 2012 to 2016 for 18 countries of the Middle East and North Africa (MENA) region.

The study adopted the Barro (1990) model of endogeneity growth to characterize the relationship between fiscal policy and economic happiness. The study estimated the model by using the pooled ordinary least squares method, the fixed effects method and the random-effects method. In addition, the study used the dynamic estimate of this relationship rather than the conventional static estimate through the generalized method of moments’ method. This leads to overcoming the endogeneity problem between the dependent variable and the independent variables.

The main findings indicated that there is a negative and statistically significant relationship between nondistortionary taxes and economic happiness. Also, there is no relationship between public expenditure and economic happiness, whether productive or nonproductive. The results confirmed a positive and significant relationship between other revenues and economic happiness. The current study recommended the diversification of other public revenue sources to increase its contribution to public expenditure financing and the restructuring of the tax system, particularly nondistortionary taxes. These taxes must be replaced by other revenues or by distortionary taxes to increase economic happiness.

The research represents a strong starting base that can help researchers to conduct more studies on economic happiness by using different measures and comparing their results to find out the determinants of happiness. The relationship between economic happiness and fiscal policy with its different aspects requires more studies, especially the relationship between taxes and economic happiness in our region. The study of the relationship between public expenditure and economic happiness according to economic activities can guide decision-makers to direct the expenditure toward economic activities that achieve the happiness of their citizens. Enriching this study requires the availability of fiscal data for the entire MENA region for longer periods, which allow us to divide the countries of the region into petroleum and nonpetroleum countries, but the scarcity of data is one of the limitations of the study.

The governments of MENA countries should diversify other public revenue sources to increase the financing public expenditure by the expense of tax revenues, especially nondistortionary taxes, which would increase the economic happiness of their citizens.

This study is one of the rare studies that investigate the relationship between fiscal policy and economic happiness at the global level. This study contributed to filling the gap of this issue in the MENA region and enriching global literature through the experience of the MENA region. Moreover, this study investigated all aspects of fiscal policy, in contrast to other studies that focused on one of its aspects. The weakness in these studies is because of the lack of correlation between the sources of revenues and the face of their spending.

This study investigates the impact of simultaneously replacing both midday single-price call auction and lunch break with multi-price continuous trading on intraday volatility–volume patterns as well as the intraday volatility–volume nexus.

The analysis utilises 150 m tick-by-tick transaction data related to 333 stocks traded on Borsa Istanbul Equity Market covering a period of 2 months prior to and following the change. In addition to graphic comparisons, the study uses difference in mean tests, panel-fixed generalized least squares (GLS), panel-random GLS and random-effects linear models with AR(1) disturbance regression estimations.

The results show that intraday volatility and trading volume form an inverse J-shape and are positively correlated. It is observed that the implementation of the regulation change decreased intraday volatility and increased trading volume. Additionally, the results indicate a negative volatility–liquidity and a positive volume–liquidity relationship, supporting the mixture of distribution hypothesis.

Enhanced market efficiency provides greater opportunity for investment and risk management. Investors can benefit from the findings on the intraday volatility–volume nexus, which is an indicator of informed trading, and regulatory authorities can use volume to oversight volatility.

This very rare regulation change of the simultaneous replacement of the lunch break and midday call auction with continuous trading is investigated in the context of intraday volume and volatility. This study also expands upon some important findings on the volume–volatility nexus for the Turkish Stock Market.

The purpose of this study is to investigate the role of foreign aid in the Western Balkans countries’ economic growth between 2009 and 2021.

This paper uses a panel data approach to examine the effects of foreign aid on economic growth in the region and incorporates a random-effects model to accommodate the unique cross-country variations and time-specific factors, as well as a pooled OLS and fixed-effects model for a comprehensive, comparative analysis.

The in-depth regression analysis shows that foreign aid has not had a significant impact on the economic growth of the region. Further evidence suggests that trade openness exhibited a significant positive correlation with economic growth, while gross capital formation, although positively associated, did not significantly impact it, indicating the complexity of its role in the region’s economies.

The analysis presented in this study has significant practical implications, particularly for policymakers in the Western Balkans. Given the region’s ambitions for European Union membership and the challenges of high unemployment and inflation, understanding the role of foreign aid is crucial.

This research provides a unique contribution to the field of development economics by examining foreign aid effectiveness within the context of a region often overlooked in the literature. The analysis also offers fresh insights into the complex dynamics of foreign aid and its implications for policy and development strategies.