Does transportation infrastructure impact economic growth in India?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Sreenu Nenavath
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Positive Impact ◽  
Transport Infrastructure ◽  
Causality Test ◽  
Content Type ◽  
Long Run ◽  
Short Run ◽  
The Government ◽  
Determinants Of Economic Growth

Purpose This paper aims to show a long run and causal association between economic growth and transport infrastructure. Design/methodology/approach In this study, the authors use ARDL models through the period 1990 – 2020 to investigate the relationship between transport infrastructure and economic growth in India. Findings The infrastructure has a positive impact on economic growth in India for the long run. Moreover, Granger causality test demonstrates a unidirectional relationship between transport infrastructure to economic development. Stimulatingly, the paper highlights the effect of air infrastructure statistically insignificant on economic growth in the long and short-run period. Originality/value The original outcome from the study delivers an inclusive depiction of determinants of economic growth from transport infrastructure in India, and these findings will help the policymakers to frame policies to improve the transport infrastructure. Hence, it is proposed that the government of Indian should focus more to upsurge the transport infrastructure for higher economic development.

The relationship between financial development and economic growth in Eswatini (formerly Swaziland)

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Siphe-okuhle Fakudze ◽  
Asrat Tsegaye ◽  
Kin Sibanda
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Financial Development ◽  
Granger Causality Test ◽  
Causality Test ◽  
Content Type ◽  
Distributed Lag ◽  
Long Run ◽  
Short Run ◽  
The Relationship

PurposeThe paper examined the relationship between financial development and economic growth for the period 1996 to 2018 in Eswatini.Design/methodology/approachThe Autoregressive Distributed Lag bounds test (ARDL) was employed to determine the long-run and short-run dynamics of the link between the variables of interest. The Granger causality test was also performed to establish the direction of causality between financial development and economic growth.FindingsThe ARDL results revealed that there is a long-run relationship between financial development and economic growth. The Granger causality test revealed bidirectional causality between money supply and economic growth, and unidirectional causality running from economic growth to financial development. The results highlight that economic growth exerts a positive and significant influence on financial development, validating the demand following hypothesis in Eswatini.Practical implicationsPolicymakers should formulate policies that aims to engineer more economic growth. The policies should strike a balance between deploying funds necessary to stimulate investment and enhancing productivity in order to enliven economic growth in Eswatini.Originality/valueThe study investigates the finance-growth linkage using time series analysis. It determines the long-run and short-run dynamics of this relationship and examines the Granger causality outcomes.

scholarly journals ANALISIS PENGARUH REMITANSI, INVESTASI ASING LANGSUNG, IMPOR DAN PERTUMBUHAN EKONOMI DI INDONESIA

2020 ◽  
Vol 2 (4) ◽  
Author(s):  
Regina Septriani Putri ◽  
Ariusni Ariusni
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Time Series Data ◽  
Positive Impact ◽  
Series Data ◽  
Long Run ◽  
Short Run ◽  
The Government ◽  
Positive Effect

Abstract : This study examined and analysis the effect of remittances, foreigndirect investment, imports, and economic growth in Indonesia in the long run andshort run. This study using Error Correction Model (ECM) method and using theannual time series data from 1989 to 2018. This study found that: (1) remittancehave an insignificant positive effect on economic growth in the long run and shortrun,(2)foreign direct investment have a significant positive impact on economicgrowth in the long run and short run, (3) import have an insignificant positiveimpact on economic growth both in the long run and short run. To increase theeconomic growth in the future, this study suggests the government to decresingimports of consume goods and increasing the inflow of capital goods, rawmaterial goods, remittances and foreign direct investment.Keyword : Remittance, Foreign Direct Investment, Import, Economic Growth andECM

The effectiveness of government expenditure on economic growth in Botswana

2019 ◽  
Vol 10 (3) ◽  
pp. 368-384 ◽  
Author(s):  
Kafayat Amusa ◽  
Mutiu Abimbola Oyinlola
Keyword(s):  
Economic Growth ◽  
Government Spending ◽  
Negative Impact ◽  
Positive Impact ◽  
Government Expenditure ◽  
Public Spending ◽  
Empirical Literature ◽  
Content Type ◽  
Long Run ◽  
Short Run

Purpose The purpose of this paper is to examine the relationship between government expenditure and economic growth in Botswana over the period 1985‒2016. The study employed the auto-regressive distributed lag (ARDL) bounds testing approach in investigating the nexus. The study makes the argument that the effectiveness of public spending should be assessed not only against the amount of the expenditure but also by the type of the expenditure. The empirical findings showed that aggregate expenditure has a negative short-run and positive long-run effect on economic growth. When expenditure is disaggregated, both forms of expenditures have a positive short-run effect on economic growth, whereas only a long-run positive impact of recurrent expenditure is observed. The study suggests the need to prioritize scarce resources in productive recurrent and development spending that enables increased productivity. Design/methodology/approach This study examined the effectiveness of government spending in Botswana, within an ARDL framework from 1985 to 2016. To achieve this, the analysis is carried out on both an aggregate and disaggregated level. Government spending is divided into recurrent and development expenditures. Findings This study examined the effectiveness of government spending in Botswana, within an ARDL framework from 1985 to 2016. To achieve this, the analysis hinged on both the aggregate and disaggregated levels. The results of the aggregate analysis suggest that total public expenditure has a negative impact on economic growth in the short run; however, its impact becomes positive over the long run. On disaggregating government spending, the results show that both recurrent and development expenditures have a significant positive short-run impact on growth; however, in the long run, the significant positive impact is only observed for recurrent expenditure. Practical implications The results provide evidence of the diverse effects of government expenditure in the country. In the period under investigation, 73 percent of total government expenditure in Botswana was recurrent in nature, whereas 23 percent was related to development. From the results, it can be observed that although the recurrent expenditure has contributed to increased growth and must be encouraged, it is also pertinent for the Botswana Government to endeavor to place more emphasis on productive development expenditure in order to enhance short- and long-term growth. Further, there is a need to strengthen the growth-enhancing structures and to prioritize the scarce economic resources toward productive spending and ensuring continued proper governance over such expenditures. Originality/value The study provides empirical evidence on the effectiveness of government spending in a small open, resource-reliant middle-income SSA economy and argues that the effectiveness of public spending must be assessed not only against the amount of the expenditure but also on the type or composition of the expenditure. The study contributes to the scant empirical literature on Botswana by employing the ARDL approach to cointegration technique in estimating the long- and short-run impact of government expenditure on economic growth between 1985 and 2016.

Effect of economic growth, trade openness, urbanization, and technology on environment of Asian emerging economies

2018 ◽  
Vol 29 (6) ◽  
pp. 1123-1134 ◽  
Author(s):  
Kashif Munir ◽  
Ayesha Ameer
Keyword(s):  
Economic Growth ◽  
Emerging Economies ◽  
New Technologies ◽  
Trade Openness ◽  
Kuznets Curve ◽  
Stirpat Model ◽  
Causality Test ◽  
Content Type ◽  
Long Run ◽  
Short Run

Purpose The purpose of this paper is to analyze the long-run as well as short-run effect of economic growth, trade openness, urbanization and technology on environmental degradation (sulfur dioxide (SO2) emissions) in Asian emerging economies. Design/methodology/approach The study utilizes the augmented STIRPAT model and uses the panel cointegration and causality test to analyze the long-run and short-run relationships. Due to the unavailability of data for all Asian emerging economies, the study focuses on 11 countries, i.e. Bangladesh, Hong Kong, India, Indonesia, Iran, Malaysia, Pakistan, Philippines, Singapore, Sri Lanka and Thailand, and uses balance panel from 1980 to 2014 at annual frequency. Findings Results showed that the inverted U-shape hypothesis of the environmental Kuznets curve holds between economic growth and SO2 emissions. While technology and trade openness increases SO2 emissions, urbanization reduces SO2 emissions in Asian emerging economies in the long run. Unidirectional causality flows from urbanization to SO2 emissions and from SO2 emissions to economic growth in the short run. Practical implications Research and development centers and programs are required at the government and private levels to control pollution through new technologies as well as to encourage the use of disposed-off waste as a source of energy which results in lower dependency on fossil fuels and leads to reduce emissions. Originality/value This study contributes to the existing literature by analyzing the effects of urbanization, economic growth, technology and trade openness on environmental pollution (measured by SO2 emissions) in Asian emerging economies. This study provides the essential evidence, information and better understanding to key stakeholders of environment. The findings of this study are useful for individuals, corporate bodies, environmentalist, researchers and government agencies at large.

LPG consumption and economic growth, 1975-2016: evidence from Cameroon

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jean Gaston Tamba
Keyword(s):  
Economic Growth ◽  
Causal Relationship ◽  
Liquefied Petroleum Gas ◽  
Content Type ◽  
Distributed Lag ◽  
Long Run ◽  
Short Run ◽  
Gas Consumption ◽  
The Government ◽  
Energy Efficiency Policies

Purpose This paper aims to examine the causal relationship between liquefied petroleum gas consumption and economic growth in Cameroon over the period from 1975 to 2016. Design/methodology/approach The methodology of this study is based on the unit root, cointegration and causality tests. Cointegration is performed with both Johansen and autoregressive distributed lag bounds approach, while causality is done with the Granger test based on the error correction model (ECM) and Toda-Yamamoto procedure. Findings The cointegration methods confirm the existence of a level relationship, whereas the causal tests of the ECM reveal the existence of a short-run unidirectional causal relationship ranging from liquefied petroleum gas (LPG) consumption to economic growth and a bidirectional causal relationship between long-term and high-causality variables. With the Toda-Yamamoto procedure, unidirectional causality is found to run from economic growth to liquefied petroleum gas consumption. Research limitations/implications These findings imply that an increase in liquefied petroleum gas consumption leads to an increase in economic growth. As a result, supporting energy efficiency policies that aim to reduce liquefied petroleum gas consumption is not an option for Cameroon. Given that LPG consumption shares are still low in Cameroon, the government ought, thus, to increase LPG subsidization, vulgarize and favor policies aimed at encouraging LPG consumption to increase LPG deposits nationwide. This would help increase LPG consumption and consequently could increase economic growth in Cameroon. Originality/value LPG is a fossil fuel and is the less GHG emitter and it is considered as a modern source of energy for cooking in Cameroon households. It scarcity calls on energy policymakers to question the influence LPG consumption could have on economic growth in the short- and long-run. Thus, this paper could contribute to solving the issue of deforestation in Cameroon, especially in the Sahel zone; through the substitution of firewood consumption by LPG consumption in households.

scholarly journals LONG RUN RELATIONSHIP BETWEEN OIL PRICE SHOCKS, EXCHANGE RATE VOLATILITY AND ECONOMIC GROWTH IN NIGERIA

2021 ◽  
Vol 4 (2) ◽  
pp. 27-51
Author(s):  
Abubakar Mikailu Aminu ◽  
◽  
Alexander Abraham Anfofum ◽  
Zakaree Saheed ◽  
◽  
...  
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Positive Impact ◽  
Exchange Rate Volatility ◽  
Oil Price ◽  
Causality Test ◽  
Long Run ◽  
Oil Price Shock ◽  
Price Shock ◽  
Short Run

The paper examined the long run relationship between oil price shock, exchange rate volatility and economic growth in Nigeria over the period 1980-2019. The study employed the Johansen Vector Autoregression (VAR)-based cointegration technique model to examine the sensitivity of real economic growth to changes in oil prices and real exchange rate volatility in the long-run while the short run dynamics was checked using a vector error correction model. The result from the Granger causality test suggests that there is causality between oil price, exchange rate and GDP. The results from Johansen cointegration test indicate there exist a long-run equilibrium relationship among the variables. Findings further show that oil price shock and appreciation in the level of exchange rate exert positive impact on real economic growth in Nigeria. The paper therefore recommends greater diversification of the economy through investment in key productive sectors of the economy using income from the crude oil export to guard against the vicissitude of oil price shock and exchange rate volatility.

Dynamic inter-linkage between foreign aid and economic growth in Sri Lanka

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ahamed Lebbe Mohamed Aslam ◽  
Sabraz Nawaz Samsudeen
Keyword(s):  
Economic Growth ◽  
Data Analysis ◽  
Sri Lanka ◽  
Foreign Aid ◽  
Correction Term ◽  
Causality Test ◽  
Content Type ◽  
Long Run ◽  
Short Run ◽  
Test Result

PurposeThe objective of this study is to explore the dynamic inter-linkage between foreign aid and economic growth in Sri Lanka over the period of 1960–2018.Design/methodology/approachBoth exploratory and inferential data analysis tools have been employed to examine the objective of this study. The exploratory data analysis covered the scatter plots, confidence ellipse with kernel fit. The inferential data analysis included the augmented Dickey–Fuller (ADF) and Phillips–Perron (PP) unit root tests, the autoregressive distributed lag (ARDL) Bounds co-integration technique and the Granger causality test.FindingsThe test result of exploratory data analysis indicates that there is a positive relationship between foreign aid and economic growth. The ADF and PP unit root tests results indicate that the variables used in this study are stationary at their 1st difference. The co-integration test result confirms the presence of long-run relationship between foreign aid and economic growth in Sri Lanka. The estimated coefficient of foreign aid in the long-run and the short-run shows that foreign aid has a positive relationship with economic growth in Sri Lanka. The estimated coefficient of error correction term indicates that approximately 26.6% of errors are adjusted each year and further shows that the response variable of economic growth moves towards the long-run equilibrium path. The Granger causality test result shows that foreign aid in short-run Granger causes economic growth in Sri Lanka which means that one-way causality from foreign aid to economic growth is confirmed. Further, the estimated coefficient of error correction term confirms that there is the long-run Granger causal relationship between foreign aid and economic growth in Sri Lanka.Practical implicationsThe findings of this study have some important policy implications for the design of efficient policy related to foreign aid and economic growth, the knowledge of which will help follow sustainable foreign aid and growth nexus.Originality/valueThis study contributes to the existing literature by using the newly introduced ARDL Bounds cointegration technique to investigate the dynamic inter-linkage between foreign aid and economic growth in Sri Lanka.

The Economic Growth–Income Inequality–Poverty Nexus and Its Impact on Environmental Degradation: Empirical Evidence from India

2021 ◽  
pp. 097639962110238
Author(s):  
Geetilaxmi Mohapatra ◽  
Arun Kumar Giri
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Environmental Degradation ◽  
Poverty Reduction ◽  
Positive Impact ◽  
Universal Access ◽  
Causality Test ◽  
Distributed Lag ◽  
Long Run ◽  
Short Run

This study attempts to examine the main forces affecting short-run and long-run carbon emission patterns due to changes in economic growth, income inequality and poverty in India over the period 1982–2018. For this purpose, it uses the autoregressive distributed lag (ARDL) cointegration technique and the vector error correction model (VECM) based on Granger causality tests. The stationary properties of the variables are checked using the Ng–Perron test. The results of the ARDL bounds test confirm the long-run relationship among the variables. Further, the ARDL coefficient confirms that economic growth and poverty increase carbon emissions in both the short and long run. The empirical findings of the causality test indicate the presence of short-run causality running from economic growth and poverty reduction to environmental degradation. Hence, the study recommends that policymakers must devote more attention to alleviating poverty and reducing income inequalities through redistributing transfers, investing on universal access to health and education, implementing progressive taxation policies, empowering women and enforcing the Clean India mission, which will have a positive impact on reducing environmental degradation in India. Further, the study also recommends appropriate environmental regulations that can substantially stimulate innovations to increase energy efficiency and thereby reduce carbon dioxide (CO2) emissions.

Financial development and economic growth: empirical evidence from India

2015 ◽  
Vol 32 (3) ◽  
pp. 340-356 ◽  
Author(s):  
Madhu Sehrawat ◽  
A K Giri
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Positive Impact ◽  
Annual Data ◽  
Content Type ◽  
Distributed Lag ◽  
Long Run ◽  
Integration Test ◽  
Short Run ◽  
Sustainable Economic Growth

Purpose – The purpose of this paper is to examine the relationship between financial development and economic growth in India using annual data from 1982 to 2012. Design/methodology/approach – The stationarity properties are checked by ADF, DF-GLS, KPSS and Ng–Perron unit root tests. The long- and short-run dynamics are examined by using the autoregressive distributed lag (ARDL) approach to co-integration. Findings – The co-integration test confirms a long-run relationship in financial development and economic growth for India. The analysis of ARDL test results reveals that both bank-based and market-based indicators of financial development have a positive impact on economic growth in India. Hence, the results support the supply-leading hypothesis and highlight the importance of financial development in economic growth. The findings also indicate that the Indian bank-centric financial sector has the potential for economic growth through credit transmission. Research limitations/implications – The present study recommends appropriate reforms in financial markets to attain sustainable economic growth. The findings are useful for policy-makers who want to maintain a parallel expansion of financial development and growth. Originality/value – To date, there are hardly any studies that use both market-based and bank-based indicators as proxies of financial development and analyze their role in economic growth in India. So, the contribution of the paper is to fill this gap in literature.

scholarly journals Causal Relationship Among Carbon Dioxide (CO2) Emissions, Renewable Energy, Population and Economic Growth in Bangladesh: An Empirical Study

2020 ◽  
Vol 11 (6) ◽  
pp. 196
Author(s):  
Shanjida Chowdhury ◽  
K. B. M. Rajibul Hasan ◽  
Mahfujur Rahman ◽  
K. M. Anwarul Islam ◽  
Nurul Mohammad Zayed
Keyword(s):  
Economic Growth ◽  
Carbon Dioxide ◽  
Economic Development ◽  
Renewable Energy ◽  
Carbon Dioxide Emissions ◽  
Long Run ◽  
Short Run ◽  
The Government ◽  
Carbon Dioxide Co2 ◽  
Bound Test

Developing countries face environmental degradation crisis due to the consumption of nonrenewable energy for economic development induces ecological destruction. However, the consequences of environmental deterioration can no longer be overlooked. Using data from 1990 from 2018, this study scrutinized the long-run equilibrium along with the trend among consumption of renewable energy, carbon dioxide emissions, Population, and economic growth in Bangladesh. This study reveals the significant cointegration of renewable energy with controlled variables using the ARDL bound test. Also, ECM with ARDL unrestricted version enables us to decide the speed of adjustment is 27.647% addressed for short-run elasticity in the long run. Stability and further diagnostic tests are performed for model post estimation and validation. Also, it needs further steps from the government side to promote renewable energy that boosts economic development.

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