scholarly journals External debt and growth: role of stable macroeconomic policies

2020 ◽  
Vol 25 (50) ◽  
pp. 185-204
Author(s):  
Sima Rani Dey ◽  
Mohammad Tareque
Keyword(s):  
Economic Growth ◽  
Negative Impact ◽  
Positive Impact ◽  
External Debt ◽  
Impulse Response Function ◽  
Principal Component ◽  
Bounds Testing ◽  
Content Type ◽  
Study Results ◽  
The Impact

Purpose This study aims to examine the impact of external debt on economic growth in Bangladesh within a broader macroeconomic scenario. Design/methodology/approach In the process of doing so, it assesses the empirical cointegration, long-run and short-run dynamics of the concerned variables for the period of 1980–2017 applying the autoregressive distributed lag (ARDL) bounds testing approach to cointegration. First, debt-gross domestic product linkage explores the impact of external debt impact on economic growth using a set of macro and country risk variables, and then this linkage is also analyzed along with a newly formed macroeconomic policy (MEP) variable using principal component analysis. Findings The study results reveal the negative impact of external debt on GDP growth, but the larger positive impact of MEP index indicates that this adverse effect of debt can be mitigated or even nullified by sound MEP and appropriate human resource policy. Originality/value The dynamic effects of different shocks (external debt and macro policy variable) on economic growth by vector autoregression impulse response function also confirm our ARDL findings.

scholarly journals The asymmetric and threshold impact of external debt on economic growth: new evidence from Egypt

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mesbah Fathy Sharaf
Keyword(s):  
Economic Growth ◽  
Structural Breaks ◽  
Negative Impact ◽  
External Debt ◽  
Threshold Level ◽  
Substantial Contribution ◽  
Content Type ◽  
Long Run ◽  
The Impact ◽  
Nardl Model

PurposeWithin a multivariate framework, this study examines the asymmetric and threshold impact of external debt on economic growth in Egypt during the period 1980–2019.Design/methodology/approachThe paper uses a nonlinear autoregressive distributed lag (NARDL) bounds testing approach to cointegration and a vector error-correction model to estimate the short- and long-run parameters of equilibrium dynamics. A multiple structural breaks model is estimated to test nonlinearity in the relationship between external debt and economic growth.FindingsResults of the NARDL model show a robust statistically significant negative long-run impact on economic growth stemming from both positive and negative external-debt-induced shocks. In terms of magnitude, on the one hand, the impact of external-debt-induced negative shocks exceeds that of the positive. In the short and long run, on the other hand, the growth impact of external debt in Egypt is symmetric. There is also support for the nonlinearity hypothesis in which a negative impact on growth of external debt obtains once the threshold level of external debt-to-GDP ratio equals or exceeds 96.7%.Practical implicationsIdentifying the threshold level after which external debt becomes harmful to economic growth would help inform policymakers in Egypt about maximum external debt levels that can be sustained without impairing economic growth.Originality/valueThe current study makes a substantial contribution to the extant literature on the debt-growth tradeoffs. It breaks ground by being the first tract that examines, using a NARDL model, asymmetry and nonlinearity of debt-growth tradeoffs in Egypt.

scholarly journals FDI-Led-Growth in Malaysia: Autoregressive Distributed Lag (ARDL) Bounds Testing Approach

2018 ◽  
Vol 11 (11) ◽  
pp. 46
Author(s):  
Jerome Kueh ◽  
Yong Sze Wei
Keyword(s):  
Economic Growth ◽  
Financial Crisis ◽  
Global Financial Crisis ◽  
Negative Impact ◽  
Positive Impact ◽  
Bounds Testing ◽  
Policy Makers ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
The Impact

This study intends to investigate the validity of the foreign direct investment, FDI-led-growth hypothesis in Malaysia in this era. Autoregressive Distributed Lag (ARDL) bounds test approach is adopted to examine the impact of FDI inflow towards growth of Malaysia based on annually data from 1980 to 2016. Empirical results indicate that FDI inflow has significant positive impact on economic growth. This implies that FDI inflow remain important tool for stimulating economic growth of Malaysia. In addition, there is a negative impact of FDI inflow on economic growth during the 1997 Asian Financial crisis and positive impact during the 2008 Global Financial crisis. In terms of policy recommendation, the policy makers should continue to develop strategies to further attract FDI that will contribute to increasing the productivity in the country.

Political instability and its impact on economic growth: the case of Jordan

2019 ◽  
Vol 18 (3) ◽  
pp. 366-380 ◽  
Author(s):  
Malak Samih Abu Murad ◽  
Nooh Alshyab
Keyword(s):  
Economic Growth ◽  
Design Methodology ◽  
Negative Impact ◽  
Positive Impact ◽  
Political Instability ◽  
Ordinary Least Squares ◽  
Small Country ◽  
Content Type ◽  
The Impact ◽  
Least Squares Approach

Purpose Political instability may have far-reaching implications for economic performance. This paper aims to analyze the impact of political instability on economic growth by focusing on the case of Jordan, a small country located in the Middle East, which represents a highly political instable region. Design/methodology/approach The analysis is performed by regressing different indicators for internal and external political instability on economic growth for the period from 1980 to 2015 using the fully modified ordinary least squares approach. Findings The results point at a significant impact of political instability on the economic growth of the country in all the specifications considered; in particular, the analysis reveals a positive impact of external political instability indexed by border countries’ political instability and a negative impact of internal political instability, as proxied by the number of crimes and cabinet changes. Further, regarding the effect of the level of freedom, the authors find evidence for the so-called conflict perspective. Originality/value This paper is original and relevant for two main reasons. First, it adds to the debate on the effects of political instability on economic growth, and hereby, disentangles the effects of internal and external political instability. Second, it makes an important contribution by focusing on the case of Jordan, which has received little attention in the literature on political instability so far, even though political instability is a constant threat to the country.

scholarly journals The Impact of Bank-Based and Market-Based Financial Development on Economic Growth: Time-Series Evidence From the United Kingdom

2016 ◽  
Vol 16 (2) ◽  
pp. 389-410
Author(s):  
S. Nyasha ◽  
N. M. Odhiambo
Keyword(s):  
Economic Growth ◽  
United Kingdom ◽  
Financial Development ◽  
Negative Impact ◽  
Positive Impact ◽  
Growth Time ◽  
Bounds Testing ◽  
Distributed Lag ◽  
The United Kingdom ◽  
The Impact

This paper examines the dynamic impact of both bank-based and market-based financial development on economic growth in the United Kingdom (UK) during the period 1980–2012, using the autoregressive distributed lag bounds testing approach. Given the complexity of the financial structure in the United Kingdom, various financial development indicators have been used to construct bank-based and market-based financial development indices. The empirical results of this study show that while market-based financial development has a positive impact on economic growth in the United Kingdom, bank-based financial development has a distinct negative impact. These results apply irrespective of whether the regression analysis is conducted in the long run or in the short run.

scholarly journals Re-examining the impact of financial intermediation on economic growth: evidence from Turkey

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ibrahim Nandom Yakubu ◽  
Aziza Hashi Abokor ◽  
Iklim Gedik Balay
Keyword(s):  
Economic Growth ◽  
Financial Intermediation ◽  
Composite Index ◽  
Principal Component ◽  
Annual Data ◽  
Bounds Testing ◽  
Content Type ◽  
Long Run ◽  
Short Run ◽  
The Impact

PurposeThis study seeks to investigate the impact of financial intermediation on economic growth in Turkey using annual data spanning 1970–2017.Design/methodology/approachBased on the results of the augmented Dickey–Fuller and Phillips–Perron unit root tests for stationarity, the authors employ the Autoregressive Distributed Lag (ARDL) bounds testing to cointegration to establish the long-run impact of financial intermediation alongside other control factors on economic growth. The study also examines the short-run relationship between financial intermediation and economic growth by estimating the Error Correction Model (ECM).FindingsThe authors’ findings indicate that financial intermediation significantly influences economic growth in both short and long run. However, the effect is positive only in the short run, lending support to the supply-leading hypothesis. Regarding the control variables, the authors observe that while financial openness shows a positive significant impact on economic growth in the long run, gross fixed capital formation matters only in the short run. The results further infer that regardless of the time period, inflation impedes economic growth.Originality/valueIn the empirical analysis of the relationship between financial intermediation and economic growth, financial intermediation is always measured using a single variable. The authors argue that such studies could produce bias and misleading results given that a single proxy does not adequately reflect financial intermediation activities. Likewise, such findings may delude policy implementation. To provide a more vivid and robust analysis, the authors employ the Principal Component Analysis (PCA) to construct a composite index for financial intermediation based on three broad measures. The researchers’ are unaware of any study on the financial intermediation–economic growth nexus using a composite index of financial intermediation. Thus, this paper fills this lacuna in the literature.

scholarly journals Does foreign portfolio investment improve the economic growth of Jordan?

Accounting ◽  
2021 ◽  
Vol 7 (7) ◽  
pp. 1669-1674
Author(s):  
Huthaifa Al-karasneh ◽  
Ashraf Bataineh ◽  
Osama Hayajneh ◽  
Omar Khodirat
Keyword(s):  
Economic Growth ◽  
Negative Impact ◽  
Positive Impact ◽  
Foreign Portfolio Investment ◽  
Econometric Methods ◽  
Study Results ◽  
Short And Long Term ◽  
The Impact ◽  
Portfolio Investments

This paper aims to examine the impact of short and long-term active Foreign Portfolio Investments (FPI) on Jordan Economic Growth (EG) thru (1996-2017) by employing some econometric methods like ARDL and Error Correction Models to reach the study results. Findings reveal that FPI have a long-term statistical positive impact on EG at level (5%) and also have a short-term negative impact on EG at level (5%), where EG needs about ten years to reach a full adjustment.

The nexus between financial development and energy consumption: Estimating the role of foreign direct investment, economic growth and urbanization

2021 ◽  
pp. 0958305X2110453
Author(s):  
Jaleel Ahmed ◽  
Shuja ur Rehman ◽  
Zaid Zuhaira ◽  
Shoaib Nisar
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Energy Consumption ◽  
Financial Development ◽  
Latin American ◽  
Direct Investment ◽  
Negative Impact ◽  
Positive Impact ◽  
Supply And Demand ◽  
The Impact

This study examines the impact of financial development on energy consumption for a wide array of countries. The estimators used for financial development are foreign direct investment, economic growth and urbanization. The study employed a panel data regression on 136 countries with time frame of years 1990 to 2019. The model in this study deploys system GMM technique to estimate the model. The results show that financial development has a significant negative impact on energy consumption overall. Foreign direct investment and urbanization has significant impact on energy consumption. Also, economic growth positive impact on energy consumption its mean that economic growth promotes energy consumption. When dividing further the sample into different groups of regions such as Asian, European, African, North/Latin American and Caribbean countries then mixed results related to the nexus between financial development and energy consumption with respect to economic growth, urbanization and foreign direct investment. The policymakers in these different groups of countries must balance the relationship between energy supply and demand to achieving the sustainable economic development.

Every coin has two sides: the impact of time pressure on employees’ knowledge hiding

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Xianchun Zhang ◽  
Zhu Yao ◽  
Wan Qunchao ◽  
Fu-Sheng Tsai
Keyword(s):  
Time Pressure ◽  
Negative Impact ◽  
Positive Impact ◽  
Job Security ◽  
Statistical Technique ◽  
Content Type ◽  
Individual Knowledge ◽  
Negative Effect ◽  
Knowledge Hiding ◽  
The Impact

Purpose Time pressure is the most common kind of work pressure that employees face in the workplace; the existing research results on the effect of time pressure are highly controversial (positive, negative, inverted U-shaped). Especially in the era of knowledge economy, there remains a research gap in the impact of time pressure on individual knowledge hiding. The purpose of this paper is to explore the impact of different time pressure (challenge and hindrance) on knowledge hiding and to explain why there is controversy about the effect of time pressure in the academics. Design/methodology/approach The authors collected two waves of data and surveyed 341 R&D employees in China. Moreover, they used regression analysis, bootstrapping and Johnson–Neyman statistical technique to verify research hypotheses. Findings The results show that challenge time pressure (CTP) has a significant negative effect on knowledge hiding, whereas hindrance time pressure (HTP) has a significant positive effect on knowledge hiding; job security mediates the relationship between time pressure and knowledge hiding; temporal leadership strengthen the positive impact of CTP on job security; temporal leadership can mitigate the negative impact of HTP on job security. Originality/value The findings not only respond to the academic debate about the effect of time pressure and point out the reasons for the controversy but also enhance the scholars’ attention and understanding of the internal mechanism between time pressure and knowledge hiding.

Banking market structure and efficiency: an assessment of the USA and Canada

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Salah U-Din ◽  
David Tripe
Keyword(s):  
Market Structure ◽  
Market Power ◽  
Negative Impact ◽  
Positive Impact ◽  
Bank Efficiency ◽  
Content Type ◽  
Frontier Analysis ◽  
Banking Market ◽  
Cost Efficient ◽  
The Impact

PurposeThe study aims to analyze the changes in banking market structure and their impact on the bank efficiency.Design/methodology/approachThis study uses a one-stage stochastic frontier analysis (SFA) to compare the impact of the market structure and the GFC on the economic efficiency of the major banks in both countries.FindingsA significant negative impact of the GFC is observed on bank efficiency. Overall, Canadian banks posted better efficiency scores than their American counterparts. Additionally, cost-efficient banks are found to be more resilient to crises and more profit-efficient in the post-GFC period. The authors found that market power had a positive impact on the cost and profit efficiency of banks. Higher levels of equity, market power and concentration helped banks be more cost-efficient.Research limitations/implicationsOnly large banks are selected for study although it represents the majority stake of both banking sectors.Practical implicationsBanking regulators should include more measures to assess the banking market structure and performance.Originality/valueAs per the best knowledge of the authors, it is the first study to assess the change in banking market structure and efficiency of the US and Canadian banking sectors in the post-GFC period.

scholarly journals The Impact of Public Debt on the Economic Growth of Jordan: An Empirical Study (2000- 2015)

2017 ◽  
Vol 6 (2) ◽  
pp. 114 ◽  
Author(s):  
Tawfiq Ahmad Mousa ◽  
Abudallah. M. LShawareh
Keyword(s):  
Economic Growth ◽  
Empirical Study ◽  
Regression Model ◽  
Least Squares ◽  
Public Debt ◽  
Least Squares Method ◽  
Negative Impact ◽  
External Debt ◽  
Using Data ◽  
The Impact

In the last two decades, Jordan’s economy has been relied on public debt in order to enhance the economic growth. As such, an understanding  of the dynamics between public debt and economic growth is very important in addressing the obstacles to economic growth. The study investigates the impact of public debt on economic growth using data from 2000 to 2015. The study employs least squares method and regression model to capture the impact of public debt on economic growth. The results of the analysis indicate that there is a negative impact of total public debt, especially the external debt on economic growth. 

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