Debt-oriented Capital Structure and Economic Growth: Panel Evidence for OECD Countries

2019 ◽  
Vol 27 (4) ◽  
pp. 519-542
Author(s):  
Syed Munawar Shah ◽  
Mariani Abdul-Majid ◽  
Zulkefly Abdul Karim
Keyword(s):  
Economic Growth ◽  
Panel Data ◽  
Capital Structure ◽  
Direct Relationship ◽  
Oecd Countries ◽  
European Countries ◽  
Real Sector ◽  
The Real ◽  
The Relationship

This paper examines the relationship between debt-oriented capital structure and economic growth by analysing a panel data of 16 European countries, based on the availability of data. We find that the corporate leverage in financial and non-financial corporations affects economic growth negatively. Furthermore, the results indicate that the leverage in non-financial corporations affects economic growth more than the leverage in financial corporations. This is due to the direct relationship between economic growth and the real sector and the fact that non-financial corporations in OECD countries hold more debt as compared with financial corporations.

The Relationship Between Economic Growth and Innovation

2020 ◽  
pp. 358-382
Author(s):  
Samet Akça ◽  
Bilge Afşar
Keyword(s):  
Economic Growth ◽  
Panel Data ◽  
Unit Root ◽  
Oecd Countries ◽  
Patent Applications ◽  
The Relationship ◽  
Positive Effect

This chapter studies innovation and economic growth and emphasizes their relationship. In this context; innovation and economic growth outputs of 16 OECD countries between 2005 and 2015 are analyzed. GDP is considered as economic growth variable, R&D investments in GDP (%), and patent applications are considered as innovation variables. In light of these variables, panel data analyze is used. Unit root, Pedroni co-integration and FMOLS tests were applied with the order. As a result, the increase in patent applications and R&D investments was found to have a positive effect on economic growth.

New Evidence on the Relationship Between Economic Freedom and Growth: A Panel Cointegration Analysis for The Case of OECD

2012 ◽  
Vol 12 (3) ◽  
pp. 1850263 ◽  
Author(s):  
Ekrem Erdem ◽  
Can Tansel Tugcu
Keyword(s):  
Economic Growth ◽  
Panel Data ◽  
Total Factor Productivity ◽  
Economic Freedom ◽  
Global Financial Crisis ◽  
Oecd Countries ◽  
Cointegration Analysis ◽  
Factor Productivity ◽  
The Impact ◽  
The Relationship

The aim of this paper is to find a new answer to an old question “Is economic freedom good or not for economies?” which was refreshed after the Global Financial Crisis of 2008. For this purpose, the relationship between economic freedom and economic growth, and the relationship between economic freedom and total factor productivity in OECD countries were investigated by using panel data for the period of 1995-2009. Study employed the recently developed cointegration test by Westerlund (2007) and the estimation technique by Bai and Kao (2006) which account for cross-sectional dependence that is an important problem in the panel data studies. Although no significant relationship found between economic freedom and total factor productivity, cointegration analysis revealed that economic freedom matters for economic growth in OECD countries in the long-run, and estimation results showed that direction of the impact is negative.

scholarly journals The Comparation of Foreign Financial Investment and Human Investment Effect on Economic in Indonesia Base on Macro Economic Point of View

2021 ◽  
Vol 39 (12) ◽  
Author(s):  
Eny Lestari Widarni ◽  
Suryaning Bawono
Keyword(s):  
Economic Growth ◽  
Direct Investment ◽  
Real Sector ◽  
Economic Point ◽  
Financial Investment ◽  
The Real ◽  
Income Transfers ◽  
Education And Health ◽  
The Impact ◽  
The Relationship

The purpose of this study is to compare the impact of the direction of the relationship between education and health investment with economic growth in Indonesia, with the impact and direction of the relationship of foreign direct investment and portfolio investment with economic growth in Indonesia. This study uses a quantitative method using the Threshold Autoregressive model. This study uses secondary data from the world bank in the annual time period from 2000 to 2019. We found that Investment in education and health has an impact on increasing productivity which drives economic growth because labor productivity directly drives the real sector. However, FDI and FPI changed the financial position in terms of capital. Direct investment increases real capital which has an impact on the creation of new sources of economic production but has consequences in the form of income transfers abroad, resulting in cash outflows. The existence of these foreign transfers continuously when economic conditions are stable and the real sector grows and generates profits that can be greater than the cash inflows obtained when foreign direct investments are made.

Reducing the Risks of the Financial Sector to Ensure Sustainable Growth of the Russian Еconomy

2019 ◽  
Vol 12 (3) ◽  
pp. 86-92
Author(s):  
T. I. Minina ◽  
V. V. Skalkin
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Financial Sector ◽  
Developed Countries ◽  
Sustainable Growth ◽  
Necessary Condition ◽  
Real Sector ◽  
Financial Instruments ◽  
The Real ◽  
The Impact

Russia’s entry into the top five economies of the world depends, among other things, on the development of the financial sector, being a necessary condition for the economic growth of a developed macroeconomic and macro-financial system. The financial sector represents a system of relationships for the effective collection and distribution of economic resources, their deployment according to public demand, reducing the risk of overproduction and overheating of the economy.Therefore, the subject of the research is the financial sector of the Russian economy.The purpose of the research was to formulate an approach to alleviating the risks of increasing financial costs in the real sector of the economy by reducing the impact of endogenous risks expressed as financial asset “bubbles” using the experience of developed countries in the monetary policy.The paper analyzes a macroeconomic model applied to the financial sector. It is established that the economic growth is determined by the growth and, more important, the qualitative development of the financial sector, which leads to two phenomena: overproduction in the real sector and an increase in asset prices in the financial sector, with a debt load in both the real and financial sectors. This results in decreasing the interest rate of the mega-regulator to near-zero values. In this case, since the mechanisms of the conventional monetary policy do not work, the unconventional monetary policy is used when the mega-regulator buys out derivative financial instruments from systemically important institutions. As a conclusion, given deflationally low rates, it is proposed that the megaregulator should issue its own derivative financial instruments and place them in the financial market.

scholarly journals Can One Promote a Delegation of the Bilateral Aid to Multilateral Donors to Improve Foreign Aid Effect on Economic Growth in ECOWAS (Note 1) Countries?

2019 ◽  
Vol 2 (1) ◽  
pp. 51
Author(s):  
W. Jean Marie Kébré
Keyword(s):  
Economic Growth ◽  
Panel Data ◽  
Least Squares ◽  
Foreign Aid ◽  
Bilateral Aid ◽  
Multilateral Aid ◽  
Multilateral Institutions ◽  
Negative Effect ◽  
High Degree ◽  
The Relationship

<p><em>This article analyzes the relationship between external aid and economic growth in the ECOWAS region, with a focus on bilateral and multilateral aid effects. The key idea behind this analysis is an argument of Svensson</em><em> </em><em>(2000)</em><em> that multilateral aid is more effective than bilateral aid because of the high degree of altruism of bilateral donors. He therefore suggested a delegation of bilateral aid to multilateral institutions. To appreciate his suggestion, this analysis used panel data from the 16 ECOWAS countries from the period 1984 to 2014. The results of the estimates, based on the dynamic least squares estimator (DOLS), show a negative effect of foreign aid on economic growth. This negative effect on economic growth persists when the components of aid are introduced into the model. In addition, results highlight that governance is a channel through which foreign aid affect positively economic growth. In these conditions, bilateral aid is more effective on economic growth than multilateral aid. These results about foreign aid received by ECOWAS countries invalidates</em><em> </em><em>Svensson’s</em><em> </em><em>(</em><a title="Svensson, 2000 #5" href="#_ENREF_1"><em>2000</em></a><em>)</em><em> theory. Therefore, a delegation of bilateral aid to multilateral institutions is not relevant because bilateral aid contributes more to economic growth if governance is taken into account.</em></p>

scholarly journals How do Poverty and Income Inequality affect Economic Growth in Developing Countries?

2021 ◽  
Vol 4 (2) ◽  
pp. 547-558
Author(s):  
Hamza Saleem ◽  
Fatima Farooq ◽  
Muhammad Aurmaghan
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Panel Data ◽  
Income Inequality ◽  
Negative Impact ◽  
Positive Impact ◽  
Development Indicators ◽  
The Relationship ◽  
Positive Effect ◽  
World Development

The major objective of this research is to examine the relationship between poverty, income inequality and economic growth from some selected developing countries. This study uses panel data for the period of 2002-2015. All the data is taken from world development indicators (WDI). To find out the results, we have used Hausman test an econometrics technique for panel data in this research. The results of the study indicate that poverty and income inequality have a negative impact on economic growth on the other hand Gross capital formation, labor force, total population and government consumption and expenditure have a positive impact on economic growth. The result tells us that changes in these variables have a significant and positive effect on the dependent variable. To achieve the goal of economic growth developing countries should reduce poverty and take meaningful steps to overcome the problem of inequality in the society which can be very helpful in achieving the goal of economic growth.

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