scholarly journals Effects of corruption on military expenditures

2019 ◽  
Vol 26 (3) ◽  
pp. 774-785
Author(s):  
Imtiaz Arif ◽  
Lubna Khan ◽  
Syed Ali Raza
Keyword(s):  
Method Of Moments ◽  
Low Income ◽  
Generalized Method Of Moments ◽  
High Income ◽  
Data Series ◽  
Annual Data ◽  
Content Type ◽  
Military Expenditures ◽  
The Military ◽  
Military Budget

Purpose This study aims to investigate the effect of corruption on military expenditures in three income level countries. An annual data series of 97 countries covering high-income, middle-income, and low-income regions from 1997 to 2015 is used. Design/methodology/approach The cross-sectional dependency and integration property of the data series was checked before applying the generalized method of moments approach to test the model. Findings The results of the system generalized method of moments approach suggest that corruption increases the military budget of high-income countries, whereas corruption reduces the military budget of the middle- and low-income countries. Originality/value This paper offers some substantial implications for the policymakers of each income group to curb corruption and improve economic development.

Does Corruption Sand or Grease the Wheels? A Case of BRICS Countries

2020 ◽  
pp. 097215092092737
Author(s):  
Imtiaz Arif ◽  
Lubna Khan ◽  
Sundus Waqar
Keyword(s):  
South Africa ◽  
Method Of Moments ◽  
Economic Effect ◽  
Generalized Method Of Moments ◽  
Data Series ◽  
Annual Data ◽  
Fdi Inflows ◽  
Brics Countries ◽  
The Government ◽  
The Relationship

This article examines the effect of corruption on the foreign direct investment (FDI) of BRICS economies, such as Brazil, Russia, India, China and South Africa. An annual data series of BRICS for 1995–2015 is used. The empirical model is estimated by using the system generalized method of moments (SGMM). The estimated outcomes suggest that corruption impacts FDI positively and significantly when these five nations are merged as a single unit. It is because corruption yields a restrictive economic effect. Moreover, the study also revealed that when we study the countries separately, corruption has a negative and significant effect on FDI in Brazil, China and India, whereas, the relationship becomes insignificant for Russia and South Africa. Results suggest that governments should enhance their policies to control corruption. Furthermore, to attract more FDI, the government of each country should look into the motivation behind their FDI inflows and tailor their polices accordingly.

Foreign aid: boosting or hindering entrepreneurship?

2018 ◽  
Vol 7 (3) ◽  
pp. 248-268 ◽  
Author(s):  
Shaomeng Jia
Keyword(s):  
Foreign Aid ◽  
Method Of Moments ◽  
Low Income ◽  
Design Methodology ◽  
Early Stage ◽  
Generalized Method Of Moments ◽  
Recipient Country ◽  
Business Failure ◽  
Content Type ◽  
Entrepreneurial Activities

Purpose The current literature has not made any connection between foreign aid and entrepreneurship. The purpose of this paper is to investigate if foreign aid influences entrepreneurial activities in a recipient country. Design/methodology/approach Using system generalized method of moments (Blundell and Bond, 1998) estimators with a panel of 38 recipient countries during 2005–2014, the author tests for 33 measures of entrepreneurial activities. Findings This paper finds that aggregate aid tends to only boost necessity-driven early-stage entrepreneurship and benefit low-income entrepreneurs. Aid to infrastructure promotes entrepreneurship driven by both opportunity and necessity motivations. It also incentivizes competition with homogeneous products. Additionally, evidence suggests that both aggregate aid and infrastructural aid discourage adoption of state-of-the-art technologies, raise business failure rate and are associated more with necessity-driven early-stage entrepreneurial activities for females. Originality/value This is the first research examining “aid and entrepreneurship” relation.

Assessing the bank profitability in the MENA region

2014 ◽  
Vol 7 (3) ◽  
pp. 305-332 ◽  
Author(s):  
Rim Ben Selma Mokni ◽  
Houssem Rachdi
Keyword(s):  
Method Of Moments ◽  
North Africa ◽  
Banking Sector ◽  
Middle Eastern ◽  
Generalized Method Of Moments ◽  
Mena Region ◽  
Bank Profitability ◽  
Content Type ◽  
Conventional Banks ◽  
Econometric Technique

Purpose – Which of the banking stream is relatively more profitable in Middle Eastern and North Africa (MENA) region? Design/methodology/approach – The empirical study covers a sample of 15 conventional and 15 Islamic banks for the period 2002-2009.The authors estimate models using the generalized method of moments in system, of Blundell and Bond (1998). They exploit an up-to-date econometric technique which takes into consideration the issue of endogeneity of regressors to evaluate the comparative profitability of Islamic and conventional banks in the MENA region. Findings – Empirical analysis results show that the determinants’ significance varies between Islamic and conventional banks. Profitability seems to be quite persistent in the MENA region reflecting a higher degree of government intervention and may signal barriers to competition. Originality/value – The main interest is to develop a comprehensive model that integrates macroeconomic, industry-specific and bank-specific determinants. The paper makes comparison of the performance between two different banking systems in the MENA region. The authors consider a variable crisis to gain additional insights into the impacts of the financial crisis on MENA banking sector.

The impact of economic and financial development on environmental degradation

2015 ◽  
Vol 32 (4) ◽  
pp. 485-502 ◽  
Author(s):  
Samia Nasreen ◽  
Sofia Anwar
Keyword(s):  
Panel Data ◽  
Financial Development ◽  
Environmental Degradation ◽  
Low Income ◽  
Ordinary Least Squares ◽  
Dynamic Panel Data ◽  
High Income ◽  
Empirical Literature ◽  
Content Type ◽  
The Impact

Purpose – The purpose of this study is to validate the impact of economic and financial development along with energy consumption on environmental degradation using dynamic panel data models for the period 1980-2010. The study uses three sub-panels constructed on the basis of income level to make panel data analysis more meaningful. Design/methodology/approach – Larsson et al. panel cointegration technique, fully modified ordinary least squares and vector error correction model causality analysis are applied for empirical estimation. Findings – Main empirical findings demonstrate that financial development reduces environmental degradation in the high-income panel and increases environmental degradation in the middle- and low-income panels. Hypothesis of the environmental Kuznets curve is accepted in all income panels. Granger causality results show the evidence of bidirectional causality between financial development and CO2 emission in the high-income panel, and unidirectional causality from financial development to CO2 emission in the middle- and low-income panels. Originality/value – In empirical literature, only a few studies explain the effect of financial development on environment. The present study is an effort to fill this gap by exploring the effect of economic and financial development on environmental degradation.

scholarly journals An exploratory study of financial well-being among Malaysian households

2020 ◽  
Vol 27 (3) ◽  
pp. 285-302
Author(s):  
Nurul Shahnaz Mahdzan ◽  
Rozaimah Zainudin ◽  
Mohd Edil Abd Sukor ◽  
Fauzi Zainir ◽  
Wan Marhaini Wan Ahmad
Keyword(s):  
Low Income ◽  
Age Groups ◽  
Well Being ◽  
Demographic Characteristics ◽  
High Income ◽  
Primary Data ◽  
Residential Areas ◽  
Future Time ◽  
Content Type ◽  
Time Perspectives

PurposeThe purpose of this paper is to empirically explore the financial well-being (FWB) of Malaysian households and to construct a subjective FWB index with present and future time perspectives.Design/methodology/approachData were collected from 1,867 respondents across five major regions in Malaysia. Adapting the InCharge Financial Distress/Financial Well-being (IFDFW) Scale by Prawitz et al. (2006) and the method of computing an index by Devlin (2009), this study develops an FWB index using subjective measures that include future time perspectives (retirement). The index was employed to measure the FWB across low-, middle- and high-income groups and socio-demographic characteristics.FindingsThis study finds evidence that Malaysians' FWB is at an average level (46.8). Middle-income households' FWB (46.1) flanks between the financial well-being index (FWBI) levels of the low-income (37.4) and high-income households (58.7). Across age groups, education levels and employment sectors, the FWB of Malaysians significantly varies, although not across different ethnics, religions, zones and residential areas. Overall, the results suggest that the detrimental effects of FWB are perceived by all Malaysian households nationwide regardless of their religion, ethnicity and residential areas.Practical implicationsThe results of this study complement the other well-being indices used by policymakers and may serve as a useful input for government and policymakers for them to formulate appropriate strategies to promote higher FWB of Malaysian households based on their socio-demographic characteristics.Originality/valueThis study used primary data and developed a subjective FWB index that leverages on people's perceptions of their own financial well-being while including present and future time perspectives. The main contribution of this paper is to construct an index that is easily interpretable and that complements the existing FWB indices, and to identify the segments of society that have low vis-à-vis high FWB.

EFFECTS OF CAPITAL INFLOWS ON FISCAL BALANCE IN AN EMERGING ECONOMY: EVIDENCE FROM PAKISTAN

2019 ◽  
pp. 1-14
Author(s):  
MUHAMMAD ZAKARIA ◽  
WEN JUN ◽  
AROOJ KHAN
Keyword(s):  
Method Of Moments ◽  
Budget Deficit ◽  
Foreign Debt ◽  
Generalized Method Of Moments ◽  
Emerging Economy ◽  
Capital Inflows ◽  
Annual Data ◽  
Fiscal Deficit ◽  
Deficit Model ◽  
Fiscal Balance

This paper examines the effect of capital inflows on fiscal deficit in an emerging economy of Pakistan. To obtain this objective, a fiscal deficit model is estimated using annual data for the period 1984–2017. The model is estimated using Generalized Method of Moments (GMM) technique. Three measures of capital inflow variables are taken, i.e., remittances, foreign direct investment (FDI) and foreign debt. The findings reveal that capital inflows increase fiscal deficit in the country. The findings show that 1% increase in remittances will increase fiscal deficit by 0.312%, while 1% increase in FDI will deteriorate budget deficit by 0.250%. Similarly, 1% increase in foreign debt will worsen fiscal balance by 0.073%. Remittances and FDI have more effect on fiscal deficit compared to foreign debt. It implies that both remittances and foreign debt deteriorate fiscal balance in the country more than foreign debt. The study suggests that remittances, FDI and foreign debt should be used for productive purposes as they will help in improving fiscal balance in the country.

Firm-level determinants of job creation by SMEs: Swedish empirical evidence

2015 ◽  
Vol 22 (4) ◽  
pp. 666-679 ◽  
Author(s):  
Darush Yazdanfar ◽  
Peter Öhman
Keyword(s):  
Method Of Moments ◽  
General Pattern ◽  
Generalized Method Of Moments ◽  
Job Creation ◽  
Financial Leverage ◽  
Firm Level ◽  
Data Set ◽  
Content Type ◽  
Industry Sectors ◽  
The Relationship

Purpose – Using a resource-based approach, the purpose of this paper is to examine the effects of the firm-level determinants financial leverage and liquidity on job creation at small and medium-sized enterprises (SMEs) in six industry sectors in Sweden. Design/methodology/approach – The generalized method of moments system model was used to analyse an extensive panel data set of 26,721 Swedish SMEs over the 2008-2011 period. Findings – The empirical results indicate that job creation is positively related to SMEs’ financial leverage and liquidity, and to their size and age. SMEs’ financial leverage and size are the most important firm-level determinants of job creation. Although there are differences between industry sectors, the results confirm the general pattern of the effect of financial leverage and liquidity on job creation. Research limitations/implications – Due to the importance of job creation for economic growth, the relationship between SMEs’ capital structure and job creation should be of interest to researchers, practitioners, and policymakers. In investigating the importance of financial leverage and liquidity to labour demand dynamics, this study analyses the firm-level factors that influence job creation by SMEs. Originality/value – Since there is limited empirical research focusing on this relationship at firm level in the context of SME, the current research aims at investigating the determinants of job creation at the firm level empirically.

Bank-based and market-based development and economic growth: an international investigation

2019 ◽  
Vol 36 (3) ◽  
pp. 365-394 ◽  
Author(s):  
Isaac Boadi ◽  
Daniel Osarfo ◽  
Perpetual Boadi
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Method Of Moments ◽  
Design Methodology ◽  
Generalized Method Of Moments ◽  
Fixed Effect ◽  
Relative Impact ◽  
Content Type ◽  
Regional Effects ◽  
Development Policies

Purpose The purpose of this paper is to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60countries. Design/methodology/approach This study uses fixed effect and generalized method of moments (GMM) to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60 countries. The study further controls regional effects and the Asian crisis, as well as the global economic crisis. Findings The empirical results of the study revealed that market-based development positively affects economic growth. Besides, market-based financial development indirectly promotes investment, which has the potential to strongly enhance growth. The findings of this study, therefore, provide more support to pro-market-based financial development policies in these regions. Interestingly, bank-based development has no direct impact on development, but indirectly encourages investment, which also promotes growth. Originality/value This paper is the first of its kind to empirically examine fixed effect and GMM to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60 countries.

scholarly journals Political tax cycles: Cyclicality of the tax burden in election periods

2021 ◽  
Vol 7 (2) ◽  
pp. 193-205
Author(s):  
K. V. Rudy ◽  
◽  
Keyword(s):  
Low Income ◽  
Political Development ◽  
Developed Countries ◽  
High Income ◽  
Political Regime ◽  
Annual Data ◽  
Tax Burden ◽  
Political Systems ◽  
Factor Regression ◽  
Similar Dynamic

The article discusses changes in the tax burden in election and post-election years in countries with different levels of economic and political development. The study uses the data on 121 countries for the period between 1991 and 2019 to test two hypotheses: 1) in election years, governments tend to boost spending while in post-election years government expenditures decline, which determines a similar dynamic of the tax burden; 2) in election years the tax burden decreases and in post-election years it either increases or decreases at a slower rate than in election periods. Methodologically, the study relies on multi-factor regression analysis of panel data. As a result, the first hypothesis is confirmed for high-income countries where the governments increase their spending to ensure the incumbent’s re-election and cut their expenditures after the election. In developed countries, in election years, the government’s spending was 0.4% higher than in other periods. In developed countries, governments were motivated to raise rather than reduce the tax burden in order to compensate for their increased expenditures. No common pattern of declining tax burden in election periods was detected for all observed countries, for groups of countries by income level (high-income, middle- or low-income) or for groups of countries by political regime type (democratic and non-democratic– hybrid or authoritarian). However, the analysis of the annual data on taxes has shown that the decline in the tax burden can occur in countries with developing economic and political systems as was the case with Armenia, Russia and Ukraine in 1992–2019. In general, the findings demonstrate that the governments are more prone to using monetary and fiscal rather than tax instruments in election periods.

scholarly journals Do segregated housing markets have a spillover effect on housing prices in nearby residential areas?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mohammad Ismail ◽  
Abukar Warsame ◽  
Mats Wilhelmsson
Keyword(s):  
Low Income ◽  
Local Governments ◽  
Housing Prices ◽  
Spillover Effect ◽  
Housing Markets ◽  
Spillover Effects ◽  
High Income ◽  
Housing Values ◽  
Content Type ◽  
Property Assessment

Purpose The purpose of this study is to analyse the trends regarding housing segregation over the past 10–20 years and determine whether housing segregation has a spillover effect on neighbouring housing areas. Namely, the authors set out to determine whether proximity to a specific type of segregated housing market has a negative impact on nearby housing markets while proximity to another type of segregated market has a positive impact. Design/methodology/approach For the purposes of this paper, the authors must combine information on segregation within a city with information on property values in the city. The authors have, therefore, used data on the income of the population and data on housing values taken from housing transactions. The case study used is the city of Stockholm, the capital of Sweden. The empirical analysis will be the estimation of the traditional hedonic pricing model. It will be estimated for the condominium market. Findings The results indicate that segregation, when measured as income sorting, has increased over time in some of the housing markets. Its effects on housing values in neighbouring housing areas are significant and statistically significant. Research limitations/implications A better understanding of the different potential spillover effects on housing prices in relation to the spatial distribution of various income groups would be beneficial in determining appropriate property assessment levels. In other words, awareness of this spillover effect could improve existing property assessment methods and provide local governments with extra information to make an informed decision on policies and services needed in different neighbourhoods. Practical implications On housing prices emanating from proximity to segregated areas with high income differs from segregated areas with low income, policies that address socio-economic costs and benefits, as well as property assessment levels, should reflect this pronounced difference. On the property level, positive spillover on housing prices near high-income segregated areas will cause an increase in the number of higher income groups and exacerbate segregation based on income. Contrarily, negative spillover on housing prices near low-income areas might discourage high-income households from moving to a location near low-income segregated areas. Local government should be aware of these spillover effects on housing prices to ensure that policies intended to reduce socioeconomic segregation, such as residential and income segregation, produce desirable results. Social implications Furthermore, a good estimation of these spillover effects on housing prices would allow local governments to carry out a cost–benefit analysis for policies intended to combat segregation and invest in deprived communities. Originality/value The main contribution of this paper is to go beyond the traditional studies of segregation that mainly emphasise residential segregation based on income levels, i.e. low-income or high-income households. The authors have analysed the spillover effect of proximity to hot spots (high income) and cold spots (low income) on the housing values of nearby condominiums or single-family homes within segregated areas in Stockholm Municipality in 2013.

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