ON THE RELATIONSHIP BETWEEN FINANCIAL INSTABILITY AND ECONOMIC PERFORMANCE: STRESSING THE BUSINESS OF NONLINEAR MODELING

2017 ◽  
Vol 23 (1) ◽  
pp. 80-100
Author(s):  
David Ubilava
Keyword(s):  
Economic Performance ◽  
Kansas City ◽  
Global Financial Crisis ◽  
Causal Effect ◽  
Nonlinear Modeling ◽  
Smooth Transition ◽  
Financial Instability ◽  
Impulse Response Functions ◽  
Economic Sectors ◽  
The Impact

The recent global financial crisis and the subsequent recession have revitalized the discussion on causal interactions between financial and economic sectors. In this study, I apply the financial stress and the national activity indices–respectively developed by Federal Reserve Banks of Kansas City and Chicago–to investigate the impact of financial uncertainty on an overall economic performance. I examine nonlinear dynamics in a vector smooth transition autoregressive framework, and illustrate regime-dependent asymmetries in the financial and economic indices using the generalized impulse-response functions. The results reveal more amplified dynamics during the stressed conditions. I further evaluate benefits of nonlinear modeling in an out-of-sample setting. The forecasting exercise brings out the important advantages that nonlinear modeling provides in the identification of the causal effect of financial instability on overall economic performance.

scholarly journals Russia and the CIS in 2008: Axis of Authoritarianism??

Asian Survey ◽  
2009 ◽  
Vol 49 (1) ◽  
pp. 135-145 ◽  
Author(s):  
Charles E. Ziegler
Keyword(s):  
Financial Crisis ◽  
Economic Performance ◽  
Domestic Politics ◽  
Global Financial Crisis ◽  
Great Power ◽  
The Caucasus ◽  
Central Asian ◽  
Presidential Succession ◽  
The Global Financial Crisis ◽  
The Impact

Russia's seamless presidential succession produced no major changes in domestic politics or foreign policy. Ties with Asia remained strong, though several key relationships——with China, Japan, and the Central Asian states——frayed under the impact of Russia's military action in Georgia. Impressive economic performance in the first half of the year boosted Russian confidence as a great power, but its vulnerability to the global financial crisis together with the heavy-handed operation in the Caucasus undermined Moscow's standing with both Asia and Europe by the end of the year.

scholarly journals Assessing the Impact of Participatory Extension Programme Membership on Farm Business Performance in Northern Ireland

Agriculture ◽  
2021 ◽  
Vol 11 (10) ◽  
pp. 949
Author(s):  
Adewale H. Adenuga ◽  
Claire Jack ◽  
Austen Ashfield ◽  
Michael Wallace
Keyword(s):  
Northern Ireland ◽  
Economic Performance ◽  
Policy Development ◽  
Business Performance ◽  
Causal Effect ◽  
Gross Margin ◽  
Difference In Differences ◽  
Analytical Technique ◽  
Participatory Extension ◽  
The Impact

This paper evaluates the impact of membership of the Business Development Groups (BDG), a participatory extension programme in Northern Ireland on the economic performance of participating farmers for dairy and sheep enterprise groups. The study employs the conditional difference-in-differences approach which combines a non-parametric matching estimator with a difference-in-differences analytical technique to obtain a credible best-estimates of the causal effect of BDG membership on farmers’ economic performance assuming that BDG participation is as good as random after controlling for observable farm characteristics and that the parallel trends assumption holds between BDG participants and non-participants. The results of the analyses showed that membership in the BDG programme has a statistically significant impact on the economic performance of participating farmers. Specifically, the results showed that farmers who are members of the dairy and sheep BDGs increased their gross margin by £109.10 and £17.10 per head respectively compared to farmers that are non-members of the BDGs. The results of the study provide robust evidence to inform policy development around the area of participatory extension programmes. It also supports the design of efficient agricultural education and extension systems that incorporates the ideas of the farmers themselves through peer-to-peer learning thereby maximising the economic and social benefits accruable from such programmes.

scholarly journals Financial Crises and Key Economic Sectors of China and India: A Comparative Review of 1991-2010

2018 ◽  
Vol 56 ◽  
pp. 04002
Author(s):  
Muhammad Umar Draz ◽  
Fayyaz Ahmad
Keyword(s):  
Economic Growth ◽  
Financial Crisis ◽  
Financial Crises ◽  
Global Financial Crisis ◽  
Economic Sectors ◽  
China And India ◽  
Comparative Review ◽  
Key Sectors ◽  
The Global Financial Crisis ◽  
The Impact

Economic growth of emerging Asian economies like China and India has been a topic of interest for researchers. However, most of the existing studies have focused on economic growth trends of China and India. The aim of this paper is to identify the core sectors of both economies and analyse the impact of the Asian financial crisis of 1997 and the global financial crisis of 2008 on the performance of those sectors. We also intend to explore the impact of the aforementioned financial crises on the overall economic growth of both nations. Our review consists of five years’ average and critical analysis of the existing studies to identify the key sectors of economy and to analyse the impact of financial crises. The results indicate that industry and service sectors are the highest contributors in the GDP of China and India respectively. We also found heterogeneous impact of financial crises on the key sectors of both nations’ economy.

Did the Global Financial Crisis of 2007-2009 Impact Economic Growth in North Africa?

2012 ◽  
Vol 11 (4) ◽  
pp. 437-455
Author(s):  
Hassan Y. Aly ◽  
Mark C. Strazicich
Keyword(s):  
Economic Growth ◽  
Financial Crisis ◽  
North Africa ◽  
Growth Rates ◽  
Structural Breaks ◽  
Global Financial Crisis ◽  
Impulse Response Functions ◽  
African Countries ◽  
Economic Growth Rates ◽  
The Impact

Abstract In this paper, we utilize time series tests with structural breaks to test for evidence of an impact on economic growth rates in North African countries following the 2007−2009 U.S. and global financial crisis. One or two breaks in economic growth are identified in each country, except for Morocco where no break is found. However, breaks that coincide with the financial crisis are found in only two of the six countries (Libya and Mauritania), while other breaks coincide most often with earlier U.S. and EU recessions. To further examine the impact of shocks, impulse response functions are estimated from Vector Auto-Regression models with structural breaks. We again find no evidence that shocks from the financial crisis had a significant impact on economic growth in North Africa. We conclude that shocks from the 2007−2009 financial crisis had only a temporary and relatively small impact on economic growth rates in North Africa.

scholarly journals Global Financial Crisis and Africa: Is the Impact Permanent or Transitory? Time Series Evidence from North Africa

2011 ◽  
Vol 101 (3) ◽  
pp. 577-581 ◽  
Author(s):  
Hassan Y Aly ◽  
Mark C Strazicich
Keyword(s):  
Economic Growth ◽  
Time Series ◽  
Financial Crisis ◽  
North Africa ◽  
Structural Breaks ◽  
Global Financial Crisis ◽  
Impulse Response Functions ◽  
Global Recession ◽  
The 2008 Financial Crisis ◽  
The Impact

We utilize time series tests with structural breaks to test for an adverse impact on economic growth rates in North Africa associated with the recent US financial crisis and global recession. One or two breaks are identified for each country, except for Morocco where no break is found, while breaks coincide with the 2008 financial crisis in only two of the six countries (Libya and Mauritania). These findings suggest that, in general, shocks from the recent financial crisis have only temporary effects on economic growth in these countries. Impulse response functions with breaks confirm these results. We conclude by suggesting explanations for these findings.

High-speed railways and local economic performance: evidence from China’s prefecture-level cities

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Chao Li ◽  
Zhao Zhao ◽  
Han Li
Keyword(s):  
Economic Performance ◽  
High Speed ◽  
Causal Effect ◽  
Mechanism Analysis ◽  
Fixed Asset ◽  
Content Type ◽  
Service Sectors ◽  
Time Variations ◽  
The Impact ◽  
Fixed Asset Investment

Purpose The purpose of this paper is to identify the causal effect of high-speed railways (HSRs) and investigate the affecting channels; the second purpose is to examine how HSRs change the distribution of economic activity across cities and sectors. Design/methodology/approach A difference-in-difference strategy is implemented to estimate the impact of recently built HSRs on local economic performance in China, exploiting the geography and time variations in HSR operations. Findings Using panel data from China’s City Statistical Yearbook 2001–2019, the authors find that HSRs lead to a significant increase in cities’ gross domestic product (GDP) and GDP per capita, but the authors do not find any significant change in GDP growth. This conclusion still holds true after the authors address the endogeneity problems. A mechanism analysis shows that HSRs improve local economic performance mainly by increasing fixed asset investment. The authors also find that the HSR investment is a policy that favors metropolitan areas due to the larger increase in the GDP for larger cities and with HSRs, the industrial and service sectors will further agglomerate in larger cities. Originality/value The authors contribute to the literature in several ways. First, this paper improves the estimation strategy in identifying the HSR impact on the local economic performance. Second, this paper investigates the affecting channels of HSRs. This paper proves that HSRs in China promote the cities’ economic performance mainly by increasing the fixed asset investment. Third, this study provides evidence for the new economic geography models pioneered by Krugman (1991).

scholarly journals Political institutions and economic performance in Ethiopia: an auto regressive distributed lag bound approach to co-integration

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Fikadu Abera Garedow
Keyword(s):  
Political Violence ◽  
Economic Performance ◽  
Political Institutions ◽  
Causal Effect ◽  
Democratic Accountability ◽  
Content Type ◽  
Distributed Lag ◽  
Auto Regressive ◽  
The Impact ◽  
Bound Test

PurposeThe main objective of this study is to examine how political institutions affect economic performance in Ethiopia over the 1980–2019 time periods.Design/methodology/approachMainly, the impact of political institution indicators including, level of democracy, political violence, democratic accountability and regime durability have been examined using auto regressive distributed lag (ARDL) bound test approach to co-integration and the error correction model.FindingsThis study confirms that level of democracy and democratic accountability has an adverse long effect on the economic performance of Ethiopia. On the other hand, political violence has a negative short-run causal effect on economic performance in Ethiopia. The study concluded that the deterioration of political institutions harmfully affected economic performance in Ethiopia.Practical implicationsGovernment policymakers should primarily pay attention to promoting and changing those political institutions that harm economic performance. Additionally, better management of political violence has important implications for fostering the economic performance of Ethiopia.Originality/valueOriginality: This study provides some valuable evidence on the nexuses between political institutions and economic performance in Ethiopia. Likely, this is the first investigation on the subject under the consideration to use time analysis and will vigorously contribute to the literature as well by employing the ADRL bound test. Previous studies have examined the impact of the institution on economic growth on a cross-country basis. Further analysis is required to understand the effects of institutions such as level of democracy, political violence and democratic accountability on economic development.

The Impact of Property Characteristics on Economic Performance of Russian Industrial Enterprises

2005 ◽  
pp. 53-68 ◽  
Author(s):  
R. Kapeliushnikov ◽  
N. Demina
Keyword(s):  
Detailed Analysis ◽  
Economic Performance ◽  
Ownership Concentration ◽  
Corporate Sector ◽  
Concentrated Ownership ◽  
Industrial Enterprises ◽  
Russian Industry ◽  
Control Premium ◽  
And Performance ◽  
The Impact

The paper provides new survey evidence on effects of concentrated ownership upon investment and performance in Russian industrial enterprises. Authors trace major changes in their ownership profile, assess pace of post-privatization redistribution of shareholdings and provide evidence on ownership concentration in the Russian industry. The major econometric findings are that the first largest shareholding is negatively associated with the firm’s investment and performance but surprisingly the second largest shareholding is positively associated with them. Moreover, these relationships do not depend on identity of majority shareholders. These results are consistent with the assumption that the entrenched controlling owners are engaged in extracting "control premium" but sizable shareholdings accumulated by other blockholders may put brakes on their expropriating behavior and thus be conductive for efficiency enhancing. The most interesting topic for further more detailed analysis is formation, stability and roles of coalitions of large blockholders in the corporate sector of post-socialist countries.

AN EMPIRICAL STUDY OF INDIAN INSURANCE INDUSTRY POST GLOBAL FINANCIAL CRISIS

2015 ◽  
Vol 6 (01-02) ◽  
Author(s):  
Anis Ur Rehman ◽  
Yasir Arafat Elahi ◽  
Sushma .
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Insurance Industry ◽  
Primary Data ◽  
Policy Recommendations ◽  
Insurance Sector ◽  
The World ◽  
The Impact ◽  
The New Deal

India has recently emerged as a major political and economic power in the world. The financial crisis that engulfed the world in 2008 needed developing countries like India to lead the rescue and recovery, instead of G7 westerns countries who dealt with such crisis in the past. Recently, discussions and negotiations are going amongst G20 countries regarding a new global financial architecture (G-20 Summit, 2008). The outcome will affect the relevant industries in India and hence it is a public interest issue for the actuarial profession in the country. Increased and more intrusive and costly regulations and red tapes are likely to be a part of the new deal (Economic Survey 2009-10). The objective of this paper is to study the perception of higher level authorities in Insurance sector regarding the role of regulator in minimizing the impact of global financial crisis. The primary data has been collected from 200 authorities in insurance industry. The data has been analyzed with statistical tools like MS-Excel. On the basis of the findings, various measures and policy recommendations for insurers have been suggested to minimize the impact of crisis.

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