Dynamic linkages among CO2 emissions, human development, financial development, and globalization: empirical evidence based on PMG long-run panel estimation

The paper examines the response of poverty reduction based on financial development and economic growth in India. The ARDL and ECM based model techniques analyze the long-run and short-run relationship among the variables in the model. The long-run estimates depict that financial development and economic growth have not significantly impacted poverty reduction and, on the other hand, resulted in injecting inequality and becoming attended to wealthier sections of the society. The short-run estimates show that financial development and economic growth have successfully tried to reduce poverty in India. The results flash a long-run nature of poverty in India and need to designs and formulations of policies that should be instrumental in reducing poverty. Impulse Response Functions' application indicates that poverty reduction will act as a catalyst for further poverty reduction in India.JEL Classification: I32, B26, O40, R15How to Cite:Alam, M. Q., & Alam, M. S. (2021). Financial Development, Economic Growth, and Poverty Reduction in India. Etikonomi: Jurnal Ekonomi, 20(1), 13 – 22. https://doi.org/10.15408/etk.v20i1.18417.

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FINANCIAL DEVELOPMENT, INCOME, TRADE, AND URBANIZATION ON CO2 EMISSIONS: NEW EVIDENCE FROM KYOTO ANNEX COUNTRIES

Journal on Innovation and Sustainability RISUS ISSN 2179-3565 ◽

10.24212/2179-3565.2018v9i3p17-37 ◽

2018 ◽

Vol 9 (3) ◽

pp. 17 ◽

Cited By ~ 10

Author(s):

Muhammad Rizwan Nazir ◽

Muhammad Imran Nazir ◽

Shujahat Haider Hashmi ◽

Zeeshan Fareed

Keyword(s):

Co2 Emissions ◽

Financial Development ◽

Environmental Degradation ◽

Trade Openness ◽

Negative Influence ◽

Financial Reforms ◽

Long Run ◽

Short Run ◽

Carbon Dioxide Co2 ◽

The Impact

This study attempts to empirically investigate the impact of financial development, income, trade openness, and urbanization on carbon dioxide (CO2) emissions for the 21 Kyoto Annex countries using a balance panel data and GMM system over the period of 1970-2016. The results show a positive relationship between income and CO2 emissions in long-run. All models support the EKC hypothesis which assumes an inverted U-shaped relationship among income and environmental degradation. Financial development has a long-run negative influence on CO2 emissions, indicating that financial development reduces the environmental degradation. This means that financial development can be used as an implement to keep the degradation environmental clean by presenting financial reforms. The urbanization declines the CO2 emissions; however, it is essential for the policymakers and urban planners in these countries to control the rapid increase in urbanization. The panel causality confirms that bi-directional causal relationship between financial development, CO2 emissions, income, trade openness, and Urbanization in short-run.

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MULTIVARIATE GRANGER CAUSALITY BETWEEN CO2 EMISSIONS, ENERGY INTENSITY AND ECONOMIC GROWTH IN PORTUGAL: EVIDENCE FROM COINTEGRATION AND CAUSALITY ANALYSIS

Technological and Economic Development of Economy ◽

10.3846/20294913.2014.989932 ◽

2015 ◽

Vol 22 (1) ◽

pp. 47-74 ◽

Cited By ~ 44

Author(s):

Muhammad SHAHBAZ ◽

Farooq Ahmed JAM ◽

Sadia BIBI ◽

Nanthakumar LOGANATHAN

Keyword(s):

Economic Growth ◽

Granger Causality ◽

Co2 Emissions ◽

Financial Development ◽

Unit Root ◽

Energy Efficient ◽

Energy Intensity ◽

Causality Analysis ◽

Long Run ◽

Vecm Granger Causality

The present study aims to investigate the relationship between economic growth, energy intensity and CO2 emissions by incorporating financial development in CO2 emissions function using Portuguese annual data over the period of 1971–2011. The unit root problem of variables is examined by applying Zivot-Andrews unit root test and the ARDL bounds testing approach is for long run relationship. The direction of causal relationship between the series is examined by the VECM Granger causality approach and robustness of causality analysis is tested by innovative accounting approach (IAA). Our empirical evidence confirmed that the variables are cointegrated for long run relationship. The results exposed that economic growth and energy intensity increase CO2 emissions, while financial development condenses it. The VECM Granger causality analysis showed the feedback effect between energy intensity and CO2 emissions, while economic growth and financial development Granger cause CO2 emissions. The study suggests that environment degradation can be controlled by using energy efficient technologies. Financial development can also play its role in improving the environmental quality by encouraging investment in energy efficient technology to enhance domestic production and save the environment from degradation.

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Institutional Quality and Financial Sector Development: Empirical Evidence from Nigeria

American Journal of Business and Management ◽

10.11634/216796061706919 ◽

2018 ◽

Vol 7 (1) ◽

pp. 1 ◽

Cited By ~ 1

Author(s):

Fisayo Fagbemi ◽

John Oluwasegun Ajibike

Keyword(s):

Empirical Evidence ◽

Financial Development ◽

Good Governance ◽

Developing Economies ◽

Institutional Quality ◽

Financial Sector ◽

African Countries ◽

Financial Sector Development ◽

Long Run ◽

Short Run

In view of the indispensable role of financial sector in both emerging and developing economies, there has been a notable spotlight on the financial sector development over the years in most African countries. Nonetheless, there are only a few studies on this topical issue, particularly for Nigeria. Hence, this study examines the long – run and short – run dynamic relationship between institutional quality and financial development in Nigeria over the period of 1984 – 2015 using Auto-Regressive Distributed Lag (ARDL) bounds test approach to cointegration. Using two different indicators (Private credit and M2) of financial development, the results consistently show that institutional factors do not have significant effect on financial development in the long – run as well as in the short – run. Furthermore, the empirical evidence indicates that regulatory quality and governance system (institutions) do not necessarily contribute to financial development in a feeble institutional environment, specifically in Nigeria. Thus, our findings suggest that whilst weak institutions could increase the risk of limiting the functioning of financial system, good governance and strong institutions are the essential ingredient of financial development in Nigeria. As a consequence, policies aimed at strengthening the quality of institutions and governance should form the major policy thrust of government (policy makers). These could help improving financial sector development in Nigeria.

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Financial and Economic Factors Affecting Foreign Direct Investment - A Panel Estimation Study of the ASEAN-5 Countries

Asia-Pacific Management Accounting Journal ◽

10.24191/apmaj.v16i3-05 ◽

2021 ◽

Vol 16 (3) ◽

pp. 103-131

Author(s):

Geetha Subramaniam ◽

◽

Ratneswary Rasiah ◽

Doris Padmini Selvaratnam ◽

Jayalakshmy Ramachandran ◽

...

Keyword(s):

Foreign Direct Investment ◽

Stock Market ◽

Financial Development ◽

Direct Investment ◽

Trade Openness ◽

Policy Implications ◽

Market Size ◽

Panel Estimation ◽

Pooled Mean Group ◽

Long Run

ASEAN's strength stems from its diversity, which generates a plethora of diverse market opportunities. Over the last few decades, Foreign Direct Investment (FDI) has risen significantly as a major source of international capital transfer, but the COVID-19 pandemic had a detrimental effect on FDI flows, with the outlook for ASEAN remaining highly unpredictable and contingent on the length of the crisis, the efficacy of policy efforts to encourage investment and to mitigate the economic consequences of the pandemic. This study examines the long-run relationships and short-run dynamic interactions between FDI and its determinants comprising of market size, trade openness, stock market capitalisation and financial development over the period 1970 to 2019. The study applies the dynamic heterogeneous panel estimation techniques of Mean Group (MG), Pooled Mean Group (PMG) and Dynamic Fixed Effects (DFE) to analyse a set of macro panel data of the ASEAN-5 countries, to establish the possible relationships between these variables. An analysis of the results reveals the existence of a long-run causality between FDI and its predictors, indicated by the significant error correction terms for the models tested in this study. There is evidence that market size and stock market capitalization significantly contribute to FDI, with market size being the most dominant contributor. Interestingly, the study also reveals that trade openness and financial development are not significant in determining FDI in the selected countries. The study concludes with an examination of policy implications and also sheds some light on the outlook of FDI in ASEAN-5 post Covid 19. Keywords: foreign direct investment, financial development, pooled mean group, ASEAN-5

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Relationship between Financial Development and Economic Growth: Empirical Evidence in Indonesia

International Journal of Economics and Finance ◽

10.5539/ijef.v10n12p37 ◽

2018 ◽

Vol 10 (12) ◽

pp. 37 ◽

Cited By ~ 1

Author(s):

Hafnida Hasan

Keyword(s):

Economic Growth ◽

Empirical Evidence ◽

Granger Causality ◽

Financial Development ◽

Trade Openness ◽

Government Expenditure ◽

Long Run ◽

Push Forward ◽

Using Data ◽

The Relationship

The aim of this paper to examine the relationship between financial development and economic growth in Indonesia by using data from 1986 until 2014. Johansen co-integration and Granger causality are utilized to analyze the data. The financial development is measured by the ratio of broad money and other control variables such as trade openness and government expenditure. The finding indicates that there is long run relationship between financial development and economic growth. Meanwhile, a unidirectional relationship had been found, it come from economic growth to financial development. Therefore, a policy to increase economic growth will push forward in proper to improve financial development in Indonesia.

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DOES REMITTANCE INFLOW PROMOTE HUMAN DEVELOPMENT IN SUB-SAHARAN AFRICA? AN EMPIRICAL INSIGHT

Global Economy Journal ◽

10.1142/s2194565920500219 ◽

2021 ◽

pp. 1-23

Author(s):

MALAYARANJAN SAHOO ◽

NARAYAN SETHI

Keyword(s):

Economic Growth ◽

Human Capital ◽

Human Development ◽

Financial Development ◽

Sub Saharan Africa ◽

Positive Effects ◽

Long Run ◽

Cointegration Tests ◽

Sub Saharan ◽

Ssa Countries

This paper examines the relationship between human development, remittances and other macroeconomic variables like life expectancy, human capital, FDI, inflation, economic growth and financial development by considering 31 Sub-Saharan African (SSA) countries during the period of 1990–2018. Kao and Fisher residual cointegration tests are applied to check the cointegration among the variables in the long-run. We apply fully modified OLS (FMOLS) and DOLS to show the long-run elasticity of explanatory variables on dependent variable. The result indicates that remittances have a positive and statistically significant effects on human development in SSA region. Similarly, government expenditure, human capital, inflation and economic growth have positive effects on human development in the region. Dumitrescu–Hurlin panel granger causality tests were observed such that there is a unidirectional causality between remittance and human development in SSA countries. However, human development and inflation rate show bi-directional relationship with each other. This paper suggests that public policies can be conceived to promote health, education and income, thereby encouraging and enhancing human development. Policymakers should also rely on other macroeconomic factors, such as government spending and financial development, to stimulate human development in SSA region.

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Nexus between Financial Development, Renewable Energy Consumption, Technological Innovations and CO2 Emissions: The Case of India

Energies ◽

10.3390/en14154505 ◽

2021 ◽

Vol 14 (15) ◽

pp. 4505

Author(s):

Muhammad Qayyum ◽

Minhaj Ali ◽

Mir Muhammad Nizamani ◽

Shijie Li ◽

Yuyuan Yu ◽

...

Keyword(s):

Renewable Energy ◽

Energy Consumption ◽

Least Squares ◽

Co2 Emissions ◽

Financial Development ◽

Ordinary Least Squares ◽

Technological Innovations ◽

Renewable Energy Consumption ◽

Long Run ◽

New Findings

Concerns regarding environmental sustainability have generally been an important element in achieving long-term development objectives. However, developing countries struggle to deal with these concerns, which all require specific treatment. As a result, this study explores the interaction between financial development, renewable energy consumption, technological innovations, and CO2 emissions in India from 1980 to 2019, taking into account the critical role of economic progress and urbanization. The Autoregressive Distributed Lag (ARDL) model is used to quantify long-run dynamics, while the Vector Error Correction Model is used to identify causal direction (VECM). According to the study’s conclusions, financial development has a considerable positive impact on CO2 emissions. The coefficient of renewable energy consumption and technical innovations, on the other hand, is strongly negative in both the short and long run, indicating that increasing these measures will reduce CO2 emissions. Furthermore, economic expansion and urbanization have a negative impact on environmental quality since they emit a significant amount of CO2 into the atmosphere. The results of the robustness checks were obtained using the Fully Modified Ordinary Least Squares (FMOLS), the Dynamic Ordinary Least Squares (DOLS), and the Canonical Cointegration Regression (CCR) approaches to verify the findings. The VECM results reveal that there is long-run causality in CO2 emissions, financial development, renewable energy utilization, and urbanization. A range of diagnostic tests were also used to confirm the validity and reliability. This study delivers new findings that contribute to the existing literature and may be of particular interest to the country’s policymakers in light of the financial system and its role in environmental issues.

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