scholarly journals Economic Globalization, Entrepreneurship, and Inclusive Growth in Africa

2021 ◽  
Vol 36 (4) ◽  
pp. 689-717
Author(s):  
Folorunsho M. Ajide ◽  
Tolulope T. Osinubi ◽  
James T. Dada
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Economic Globalization ◽  
Inclusive Growth ◽  
African Countries ◽  
Dynamic Relationship ◽  
Causality Tests ◽  
The Impact ◽  
The Relationship

An increasing number of studies are examining the relationship between entrepreneurship and growth. This relationship is controversial, especially for developing countries. Recent improvements in economic growth have led to a focus on growth inclusiveness, which spreads economic opportunities throughout a society. However, studies that focus on the role of entrepreneurship in inclusive growth remain scarce. To fill that gap, this study investigates the dynamic relationship between economic globalization, entrepreneurship, and inclusive growth in 21 African countries using panel econometrics to examine data covering 2006 to 2018. The results reveal that the impact of economic globalization and entrepreneurship on inclusive growth is positive and significant. We find that economic globalization enhances entrepreneurial development, and causality tests show that economic globalization drives inclusive growth. We also find a unidirectional causality from entrepreneurship to inclusive growth. Finally, we observe no direction of causality between economic globalization and entrepreneurship but observe a bidirectional causality between governance and entrepreneurship. We discuss the implications of these results.

The Impact of Shadow Banking on Economic Growth: Evidence from Cross Country Data (2006–2018)

2020 ◽  
Vol 11 (03) ◽  
pp. 2050010
Author(s):  
Sheunesu Zhou ◽  
D Tewari Dev
Keyword(s):  
Economic Growth ◽  
Positive Association ◽  
Shadow Banking ◽  
Stock Market Development ◽  
Long Run ◽  
Causality Tests ◽  
The Impact ◽  
The Relationship ◽  
Regular Review

Shadow banking has become an important part of many financial systems despite having contributed to the financial crisis of 2008/2009. This study analyzes the relationship between shadow banking and economic growth using a panel of 28 developed and emerging economies. We employ panel feasible GLS technique and find a positive association between shadow banking and economic growth in the long-run. Further, we test for the Finance–Growth relationship using Granger causality tests and find a bi-directional relationship between shadow banking and economic growth. Stock market development and bank credit also have positive bi-directional relationships with economic growth. Our findings emphasize the role of financial innovation in enhancing economic performance given a stable regulatory environment. We suggest regular review of macro-prudential policy to carter for new financial activities and also to allow for development of new financing techniques.

scholarly journals The Role of FDI Inflow in Economic Growth: Evidence from Developing Countries

2021 ◽  
Vol 2 (1) ◽  
pp. 68-80
Author(s):  
Cao Liang ◽  
Salman Ali Shah ◽  
Tian Bifei
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Positive Relationship ◽  
Practical Implication ◽  
Least Square ◽  
Annual Data ◽  
World Economic ◽  
The Impact ◽  
The Relationship

Purpose: This study is carried out to study the relationship between FDI and economic growth of developing countries. Approach/ Methodology/ Design: The study used data from 2000 to 2019 for 113 developing and transition countries. The study used Hausman fixed effect and instrumental variables two stage least square region to trace the results. Findings: The result of the study found a positive relationship between FDI and economic growth. An increase in FDI inflow will result and upsurge in economic growth of developing country. The relationship between unemployment and economic growth is found negative. The overall results show that FDI and economic growth has a positive relationship in developing countries. Practical Implication: This study used annual data of pre pandemic. It is concluded in the study that future studies have to check the impact in post pandemic scenario. Originality/Value: Though the relationship between FDI and economic growth is studied widely in different studies. As mentioned that COVID-19 pandemic changed the world economic situation there is much more aspects of FDI and economic growth is remaining to study. The issue of FDI and economic growth for a cluster of 113 countries is addressed in this study.

scholarly journals The Relationship between External Financial Flows and Economic Growth in the Southern African Development Community (SADC): The Role of Institutions

2016 ◽  
Vol 8 (1(J)) ◽  
pp. 87-103 ◽  
Author(s):  
Kapingura Forget Mingiri ◽  
S.I Ikhide ◽  
A Tsegaye
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Financial Flows ◽  
Empirical Results ◽  
External Finance ◽  
Domestic Savings ◽  
Low Levels ◽  
The Impact ◽  
The Relationship

The study examined the relationship between external financial flows, domestic savings and economic growth in the SADC region for the period from 1980 to 2009 specifically looking at the role played by institutions. The majority of countries in the SADC region are experiencing low levels of savings, which has led to them relying more on external financial flows to bridge the gap between domestic demand for finance and domestic supply. However the relationship between external finance and economic growth is still a contentious issue. Given this, the study has thus examined the link between growth and external finance in the region, specifically focusing on the impact of the different forms of external financial flows on economic growth in the region incorporating the role played by institutions. The empirical results revealed that three types of external financial flows have a significant impact on economic growth in the SADC region except ODA; however when all the different types of external financial flows were interacted with the measure of institutions, they all become significant and more enhanced in explaining economic growth in the region. This supports the hypothesis that good institutions are necessary in promoting economic growth in developing countries. The empirical results also suggest that foreign capital is another channel through which a crisis in developing countries can be transmitted to the SADC region.

The Impact of Reinsurance

2021 ◽  
Author(s):  
Niels Viggo Haueter
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Insurance Industry ◽  
Natural Catastrophes ◽  
Security Interest ◽  
Environmental Deterioration ◽  
Stabilizing Effect ◽  
The 1960S ◽  
The Impact

Reinsurance is perceived to have a stabilizing effect on the direct insurance industry and thereby on the economy overall. Yet, research into how exactly reinsurance impacts various areas is scarce. Traditionally, studying the impact of reinsurance used to be in the domain of actuaries; since the 1960s, they have tried to assess how different contract elements can provide what came to be called “optimal reinsurance.” In the 2010s, such research was intensified in developing countries with the aim to deploy reinsurance to support economic growth and security. Interest in reinsurance increased when the industry became more visible in the 1990s as the impact of natural catastrophes started being linked to a changing climate. Reinsurers emerged as spokespeople for climate-related issues, and the industry took a lead role in arguing in favor of implementing measures to reduce environmental deterioration. Reinsurers, it was argued, have a vested interest in managing the impact of natural catastrophes. This triggered discussions about the role of reinsurance overall and about how to assess its impact. In the wake of the financial crisis of 2007 and 2008, interest in reinsurance again surged, this time due to perceived systemic impacts.

scholarly journals The human capital–economic growth nexus in SSA countries: what can strengthen the relationship?

2020 ◽  
Vol 47 (9) ◽  
pp. 1143-1159
Author(s):  
Roseline Tapuwa Karambakuwa ◽  
Ronney Ncwadi ◽  
Andrew Phiri
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Least Squares ◽  
Ordinary Least Squares ◽  
African Countries ◽  
Content Type ◽  
Econometric Approach ◽  
The Impact ◽  
The Relationship ◽  
Ssa Countries

PurposeThe purpose of this study is to examine the impact of human capital on economic growth for a selected sample of nine SSA countries between 1980 and 2014 using a panel econometric approach.Design/methodology/approachThe authors estimate a log-linearized endogenous using the fully modified ordinary least squares (FMOLS) and the dynamic ordinary least squares (POLS) applied to our panel data time series.FindingsThe empirical analysis shows an insignificant effect of human capital on economic growth for our selected sample. These findings remain unchanged even after adding interactive terms to human capital, which are representatives of government spending as well as foreign direct investment. Nevertheless, the authors establish a positive and significant effect of the interactive term between urbanization and human capital on economic growth.Practical implicationsThe results emphasize the need for African policymakers to develop urbanized, “smart”, technologically driven cities within the SSA region as a platform toward strengthening the impact of human capital-economic growth relationship.Originality/valueThis study becomes the first in the literature to validate the human capital–urbanization–growth relationship for African countries.

The mediation role of public governance in the relationship between entrepreneurship and economic growth

2019 ◽  
Vol 16 (3) ◽  
pp. 316-333
Author(s):  
Allam Mohammed Hamdan ◽  
Reem Khamis ◽  
Ammar Abdulla Al Hawaj ◽  
Elisabetta Barone
Keyword(s):  
Economic Growth ◽  
United Arab Emirates ◽  
Entrepreneurial Activity ◽  
Public Governance ◽  
Content Type ◽  
National Economic ◽  
Oil Revenues ◽  
The Impact ◽  
The Relationship

Purpose The purpose of this paper is to investigate the mediation role of public governance in the relationship between entrepreneurship and economic growth in the United Arab Emirates (UAE). Design/methodology/approach To achieve this aim, the study uses a 20-year time series analysis (1996–2015) and tests the effect of entrepreneurship on economic growth, through public governance, via a mediator model. Findings The study has determined that public governance buoys the positive effect that entrepreneurship activities exert on economic growth in the UAE. Based on this determination, the study posits a set of recommendations that focus on supporting entrepreneurship activities that play a significant role in economic growth. Originality/value The study adds to the literature on the impact of entrepreneurship on economies dependent on oil revenues vis-à-vis a public policy perspective. The study provides insights into the type of entrepreneurship that most efficaciously suits the Emirati social and cultural milieu in terms of fostering national economic growth. In addition, the study limns a vision of the role of public governance in creating an enabling environment that stimulates entrepreneurial activity and, in turn, increases economic growth in the Emirates.

scholarly journals Inflation and Economic Growth: a Review of The International Literature

2017 ◽  
Vol 20 (3) ◽  
pp. 41-56 ◽  
Author(s):  
Foluso A. Akinsola ◽  
Nicholas M. Odhiambo
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Negative Relationship ◽  
Threshold Level ◽  
Data Set ◽  
Developed Economies ◽  
The Impact ◽  
The Relationship ◽  
Over Time ◽  
Country Specific

This paper surveys the existing literature on the relationship between inflation and economic growth in developed and developing countries, highlighting the theoretical and empirical indications. The study finds that the impact of inflation on economic growth varies from country to country and over time. The study also finds that the results from these studies depend on country‑specific characteristics, the data set used, and the methodology employed. On balance, the study finds overwhelming support in favour of a negative relationship between inflation and growth, especially in developed economies. However, there is still much controversy about the specific threshold level of inflation that is appropriate for growth. Most previous studies on this subject just assume a unidirectional causal relationsship between inflation and economic growth. To our knowledge, this may be the first review of its kind to survey, in detail, the existing research on the relationship between inflation and economic growth in developed and developing countries.

scholarly journals Export Earnings, Capital Instability and Economic Growth in South Asia

2003 ◽  
Vol 8 (1) ◽  
pp. 65-89
Author(s):  
Muhammad Aslam Chaudhary ◽  
Amjad Naveed
Keyword(s):  
Economic Growth ◽  
South Asian ◽  
Foreign Capital ◽  
Developed Countries ◽  
Export Diversification ◽  
Asian Countries ◽  
The Impact ◽  
The Relationship

During the last two decades the role of international trade and flow of foreign capital have received considerable attention in the literature. Various studies have examined the impact of export instability and capital instability on economic growth in less developed countries.1 Empirical evidence supports the hypothesis of a deleterious impact of export instability on economic growth. However, some studies also indicated that the relationship was unstable but positive with economic growth.2 Yet there are no systematic empirical investigations into the implied links between export diversification and long-term economic growth, particularly in the case of South Asian countries. The major concern regarding export instability is that it retards economic growth.

scholarly journals Does Uncertainty Matter for Trade - Economic Growth Nexus in Indonesia?

2021 ◽  
Vol 67 (1) ◽  
pp. 147
Author(s):  
Panky Tri Febiyansah ◽  
Bintang Dwitya Cahyono ◽  
Rio Novandra
Keyword(s):  
Economic Growth ◽  
Causal Relationship ◽  
Output Growth ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
The Impact ◽  
The Relationship

This paper aims to test the impact of uncertainty on the causal relationship among exports, imports, and economic growth in Indonesia. The relationship is constructed by examining the presence of FDI-adjusted exports and imports (trade) and the output link using conditional variances-covariances derived from the generalized autoregressive conditional heteroskedastic (GARCH) process in a vector error correction model (VEC-GARCH model). Using evidence in Indonesia, the model exposes the uni-directional nexus from trade performance to trade-adjusted output growth in the absence of uncertainty. The volatility effects are evident in the causal relationship between trade and output. The finding shows that the uncertainty effects hamper the trade-economic growth nexus. Incorporated with the long-run causality, trade still causes output even after containing the contributions of volatility. The significant role of imports highlights the higher demand for intermediate capital products and the inclusion of technology in strengthening economic growth.

scholarly journals African pathway to achieve inclusive growth: COMESA case study

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Samar H. Albagoury
Keyword(s):  
Economic Growth ◽  
Data Envelopment Analysis ◽  
Growth Rates ◽  
High Growth ◽  
Poverty Rate ◽  
Data Envelopment ◽  
Inclusive Growth ◽  
African Countries ◽  
Content Type ◽  
The Relationship

Purpose The relationship between economic growth performance and achieving inclusive growth, especially concerning poverty rate, is a subject of continuous argument in economic literature. Although some argue that this relationship is deterministic, i.e. achieving economic growth will definitely reduce poverty and enhance inclusive growth, others believe that the relationship between growth and poverty is conditional, depends mainly on the status of income distribution in this country, i.e. if the growth is combined with a significant improve in distribution then it will reduce poverty. Design/methodology/approach Africa is a clear example of the nexus between economic growth and poverty reduction. Although many African countries manage to achieve relatively high growth rates, hit two digits in some cases, during the last decades, poverty still widely spread in those countries. Of the 30 poorest countries in the world, 24 are African countries. And about 50% of African people still live under the poverty line. Common Market for Eastern and Southern Africa (COMESA), which could be considered as one of the fastest growing regions in Africa, is not an exception; although the region achieves relatively high growth rates, poverty and inequality are still among the region’s main development challenges. Findings This paper found that the economic growth rate achieved in COMESA countries could not be considered as inclusive growth as it does not combine with adequate enhancement in inclusiveness indicators. And that the structural characteristics of those countries economy and its inelasticity are the main reasons behind this inefficiency. Originality/value In this context, this paper aims to evaluate the effectiveness of economic growth achieved in COMESA countries in achieving inclusive growth and to identify the main factors affecting this relationship by using two steps data envelopment analysis. Although this method is originally developed to evaluate the relative economic efficiencies, the main contribution of this paper is the adaptation of data envelopment analysis to evaluate the efficiency of economic growth achieved in COMESA countries in enhancing inclusive growth dimensions such as poverty rate, inequality, unemployment, education, health, and then to identify in its second step the main indicators that could be used to explain the variation in efficiency scores.

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