scholarly journals Revisiting the role of governance and institutions in the impact of financial liberalization on economic growth using the PSTR model

2017 ◽  
Vol 64 (3) ◽  
pp. 315-336 ◽  
Author(s):  
Hichem Saidi ◽  
Houssem Rachdi ◽  
Nidhal Mgadmi
Keyword(s):  
Economic Growth ◽  
Financial Liberalization ◽  
Growth Models ◽  
Study Data ◽  
Smooth Transition ◽  
Smooth Transition Regression ◽  
The Impact ◽  
The Relationship ◽  
Endogenous Growth Models

This paper provides a comprehensive review of the literature on the dual effect of financial liberalization over more than three decades, starting from the independent contributions of Ronald I. McKinnon and Edwards S. Shaw on this topic. In this regard, the paper revisits the effects of financial liberalization and governance on growth. Moreover, it presents a summary of current research in this area, covering the conclusions of the endogenous growth models, issues on volatility and the relationship between financial liberalization, institutions, governance and economic growth. To study data of 54 countries from 1985 to 2010 and because the nexus between financial liberalization and economic growth is nonlinear and depends on specific national factors especially institutions quality and governance, the Panel Smooth Transition Regression (PSTR) model is used. The main result of this study shows that a better contribution of financial liberalization to economic growth requires the interrelationship and the complementarity between financial liberalization and governance. Overall, regardless of the level of liberalization, output income is always higher with better governance and institutions.

scholarly journals The Impact of Regulatory Quality on the Nexus between Life Insurance Development and Economic Growth: Evidence from European Developing Countries

2020 ◽  
pp. 141-152
Author(s):  
Gengnan Chiang ◽  
Chin-Chi Liu
Keyword(s):  
Economic Growth ◽  
Life Insurance ◽  
Smooth Transition ◽  
Growth Effect ◽  
Governance Indicators ◽  
Regulatory Quality ◽  
Smooth Transition Regression ◽  
The Impact ◽  
The Relationship ◽  
Insurance Development

The purpose of this study is to explore whether the regulatory quality influences the relation between life insurance development and economic growth by applying a nonlinear panel smooth transition regression (PSTR) model. Using the data from Worldwide Governance Indicators (WGI) to assess the soundness of regulatory quality, this paper finds that the relationship between life insurance development and economic growth is significantly positive in the countries with relatively better regulatory quality. Our findings not only indicate that sound regulatory quality could encourage the growth effect of life insurance sectors but also have far-reaching practical implications for other economies to realize regulatory quality should matter for the development of the economic growth.

The mediation role of public governance in the relationship between entrepreneurship and economic growth

2019 ◽  
Vol 16 (3) ◽  
pp. 316-333
Author(s):  
Allam Mohammed Hamdan ◽  
Reem Khamis ◽  
Ammar Abdulla Al Hawaj ◽  
Elisabetta Barone
Keyword(s):  
Economic Growth ◽  
United Arab Emirates ◽  
Entrepreneurial Activity ◽  
Public Governance ◽  
Content Type ◽  
National Economic ◽  
Oil Revenues ◽  
The Impact ◽  
The Relationship

Purpose The purpose of this paper is to investigate the mediation role of public governance in the relationship between entrepreneurship and economic growth in the United Arab Emirates (UAE). Design/methodology/approach To achieve this aim, the study uses a 20-year time series analysis (1996–2015) and tests the effect of entrepreneurship on economic growth, through public governance, via a mediator model. Findings The study has determined that public governance buoys the positive effect that entrepreneurship activities exert on economic growth in the UAE. Based on this determination, the study posits a set of recommendations that focus on supporting entrepreneurship activities that play a significant role in economic growth. Originality/value The study adds to the literature on the impact of entrepreneurship on economies dependent on oil revenues vis-à-vis a public policy perspective. The study provides insights into the type of entrepreneurship that most efficaciously suits the Emirati social and cultural milieu in terms of fostering national economic growth. In addition, the study limns a vision of the role of public governance in creating an enabling environment that stimulates entrepreneurial activity and, in turn, increases economic growth in the Emirates.

scholarly journals Export Earnings, Capital Instability and Economic Growth in South Asia

2003 ◽  
Vol 8 (1) ◽  
pp. 65-89
Author(s):  
Muhammad Aslam Chaudhary ◽  
Amjad Naveed
Keyword(s):  
Economic Growth ◽  
South Asian ◽  
Foreign Capital ◽  
Developed Countries ◽  
Export Diversification ◽  
Asian Countries ◽  
The Impact ◽  
The Relationship

During the last two decades the role of international trade and flow of foreign capital have received considerable attention in the literature. Various studies have examined the impact of export instability and capital instability on economic growth in less developed countries.1 Empirical evidence supports the hypothesis of a deleterious impact of export instability on economic growth. However, some studies also indicated that the relationship was unstable but positive with economic growth.2 Yet there are no systematic empirical investigations into the implied links between export diversification and long-term economic growth, particularly in the case of South Asian countries. The major concern regarding export instability is that it retards economic growth.

scholarly journals Human Development, Political Stability and Economic Growth: The way forward

2020 ◽  
Vol 6 (2) ◽  
pp. 451-461
Author(s):  
Areeba Khan ◽  
Sulaman Hafeez Siddiqui ◽  
Shahid Hussain Bukhari ◽  
Syed Muhammad Hashim Iqbal
Keyword(s):  
Economic Growth ◽  
Human Development ◽  
Growth Models ◽  
Political Stability ◽  
Reverse Causality ◽  
Economic Stability ◽  
The Relationship ◽  
Endogenous Growth Models ◽  
Reallocation Of Resources

Economic growth has been known to foster human development for long term economic stability. The evidence of bi-causality in the human development and economic growth nexus is however limited. This paper builds on the reverse causality between human development and economic growth in context of Pakistan, with the moderating impact of political stability. The study applies OLS and VECM on the data collected from World Bank Database from year 2006 to 2018. Our findings exhibit empirical evidence related to endogenous growth models and a significant causal relationship between human development and economic growth, moderated by political stability. The relationship is further explained by trajectories of happiness, health and income redistribution. Our findings suggest efficient reallocation of resources towards human development to address post pandemic growth concerns.

scholarly journals Does Uncertainty Matter for Trade - Economic Growth Nexus in Indonesia?

2021 ◽  
Vol 67 (1) ◽  
pp. 147
Author(s):  
Panky Tri Febiyansah ◽  
Bintang Dwitya Cahyono ◽  
Rio Novandra
Keyword(s):  
Economic Growth ◽  
Causal Relationship ◽  
Output Growth ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
The Impact ◽  
The Relationship

This paper aims to test the impact of uncertainty on the causal relationship among exports, imports, and economic growth in Indonesia. The relationship is constructed by examining the presence of FDI-adjusted exports and imports (trade) and the output link using conditional variances-covariances derived from the generalized autoregressive conditional heteroskedastic (GARCH) process in a vector error correction model (VEC-GARCH model). Using evidence in Indonesia, the model exposes the uni-directional nexus from trade performance to trade-adjusted output growth in the absence of uncertainty. The volatility effects are evident in the causal relationship between trade and output. The finding shows that the uncertainty effects hamper the trade-economic growth nexus. Incorporated with the long-run causality, trade still causes output even after containing the contributions of volatility. The significant role of imports highlights the higher demand for intermediate capital products and the inclusion of technology in strengthening economic growth.

The Impact of Shadow Banking on Economic Growth: Evidence from Cross Country Data (2006–2018)

2020 ◽  
Vol 11 (03) ◽  
pp. 2050010
Author(s):  
Sheunesu Zhou ◽  
D Tewari Dev
Keyword(s):  
Economic Growth ◽  
Positive Association ◽  
Shadow Banking ◽  
Stock Market Development ◽  
Long Run ◽  
Causality Tests ◽  
The Impact ◽  
The Relationship ◽  
Regular Review

Shadow banking has become an important part of many financial systems despite having contributed to the financial crisis of 2008/2009. This study analyzes the relationship between shadow banking and economic growth using a panel of 28 developed and emerging economies. We employ panel feasible GLS technique and find a positive association between shadow banking and economic growth in the long-run. Further, we test for the Finance–Growth relationship using Granger causality tests and find a bi-directional relationship between shadow banking and economic growth. Stock market development and bank credit also have positive bi-directional relationships with economic growth. Our findings emphasize the role of financial innovation in enhancing economic performance given a stable regulatory environment. We suggest regular review of macro-prudential policy to carter for new financial activities and also to allow for development of new financing techniques.

scholarly journals The Nexus between Financial Development and Innovation: Case of OECD

2017 ◽  
Author(s):  
Harun Bal ◽  
Erhan İşcan ◽  
Duygu Serin Oktay ◽  
Duygu Kara
Keyword(s):  
Financial Development ◽  
Positive Impact ◽  
Growth Models ◽  
Oecd Countries ◽  
Substantial Effect ◽  
Innovation Capacity ◽  
The Impact ◽  
Changing Role ◽  
The Relationship

Finance-growth nexus is a very known topic in the finance literature and most of the studies confirmed the finance-led growth hypothesis for all developed and developing countries. On the other hand, numerous studies investigated the impact of innovation on economic growth and found a substantial effect of the innovation. Especially for the last two decades almost every study agreed on the positive impact of financial development and innovation on growth. Besides various innovation-based growth models indicated that financial development is one of the main promoter of innovation-based economy. Financial development affects the efficiency of the market or the firm and this increases the innovation capacity. Despite this, only few studies focused on the relation of financial development and innovation. The main purpose of this study is to analyze the relationship between the financial development and innovation for selected OECD countries. Especially this study highlighted the changing role of the financial markets to promote the innovative activity of OECD countries. For this purpose, ARDL model employed to analyze the nexus between the financial development and innovation. The empirical findings of this study provided more knowledge to implement more effective policies to policymakers.

Application of smooth transition regression (STR) model on the relationship between natural gas consumption and economic growth in Nigeria

2018 ◽  
Vol 12 (2) ◽  
pp. 284-296 ◽  
Author(s):  
Mukhtar Danladi Galadima ◽  
Abubakar Wambai Aminu
Keyword(s):  
Economic Growth ◽  
Natural Gas ◽  
Threshold Value ◽  
Optimal Level ◽  
Smooth Transition ◽  
Content Type ◽  
Smooth Transition Regression ◽  
Gas Consumption ◽  
Natural Gas Consumption ◽  
The Relationship

Purpose The purpose of this paper is to identify the level of natural gas consumption that can be adjudged as capable of improving the growth of the Nigerian economy, to investigate whether natural gas consumption is at optimal level in Nigeria and to examine the nature and rate to which natural gas consumption affects economic growth in Nigeria at low and high regimes. Design/methodology/approach The tool used to achieve the objectives of the paper is the smooth transition regression (STR) model. Findings The findings of the paper are that the relationship between natural gas consumption and economic growth in Nigeria is asymmetric, where the natural gas consumption threshold value in the country is 9085.36 standard cubic meters, whereas the level of its consumption in the country is below the optimal level. Further, in both low and high regimes, natural gas consumption has been found to have a positive and significant impact on economic growth in Nigeria. Practical implications The policy implication of the paper is that natural gas consumption in Nigeria should not be less than 9085.36 standard cubic meters and the country should intensify efforts to increase the level of natural gas consumption, as it is below the optimal level and its consumption bolsters the growth of Nigerian economy. Originality/value What is new in this paper is its ability to use the STR model. To the best of the authors’ knowledge, such methodology has not been adopted before in such a relation.

THE ROLE OF INSTITUTIONAL QUALITY IN THE RELATIONSHIP BETWEEN FDI AND ECONOMIC GROWTH IN VIETNAM: EMPIRICAL EVIDENCE FROM PROVINCIAL DATA

2019 ◽  
Vol 64 (03) ◽  
pp. 601-623 ◽  
Author(s):  
NGUYEN VAN BON
Keyword(s):  
Economic Growth ◽  
Positive Impact ◽  
Estimation Method ◽  
Institutional Quality ◽  
Economic Activities ◽  
Fdi Inflows ◽  
Important Message ◽  
The Impact ◽  
The Relationship

All investigations into the role of institutions in the relationship between foreign direct investment (FDI) and economic growth conclude the impact of interaction between FDI and institutional quality on economic growth is significantly positive. Contrary to the conclusion of these studies, this paper finds it is significantly negative for a panel data of 43 provinces in Vietnam over the period 2005–2012 via the estimation method of difference panel GMM Arellano–Bond. In addition, the estimated results also show: (1) FDI inflows significantly foster economic growth; (2) Good institutional quality has a significantly positive impact while bad institutional quality has a negative albeit insignificant effect on economic growth. From the policy perspective, these findings signal an important message to developing countries that governments should carefully adjust policies and institutions because aside from attracting more FDI inflows and promoting the economic activities, it can also be detrimental to economic growth.

scholarly journals THE IMPACT OF PROVIDING CARE FOR GRANDCHILDREN ON THE QUALITY OF LIFE OF GRANDPARENTS

2019 ◽  
Vol 24 (3) ◽  
Author(s):  
Katarzyna Skałacka ◽  
Keyword(s):  
Quality Of Life ◽  
Work Load ◽  
Study Data ◽  
The Social ◽  
Professional Field ◽  
Relationship Of ◽  
The Impact ◽  
The Relationship

Contemporary grandparents are active people, not only in the social but also professional field. Regardless of other duties, one of the socially assigned tasks in the role of grandparent is to take care for grandchildren. As various studies have reported, this task may bring caregivers more losses than benefits (eg Goodman & Silverstein, 2002). In the present study, data from 148 people over 57 years who have looked after grandchildren have been analyzed, to determine whether the amount of time devoted by grandparents to care for grandchildren will affect their sense of quality of life. Grandparents gender, age, and locus of control was controlled. The obtained results confirmed that with the increase of the number of hours devoted to grandchildren care, the sense of quality of life of the grandparents drops. This effect is stronger among grandfathers. The sense of the location of control plays the role of a mediator and suppressor in the relationship of care time over grandchildren with a sense of quality of life. The results are discussed in the context of potential family burden and work load among grandparents. Key words: grandparents, grandchildren, quality of life, location of control, care for grandchildren

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