scholarly journals Determinants of Indonesia’s National Income: An Auto-Regressive Distributed Lag Analysis

2020 ◽  
Vol 9 (2) ◽  
pp. 207-218
Author(s):  
Prihartini Budi Astuti ◽  
Nur Khasanah
Keyword(s):  
Economic Growth ◽  
Aggregate Demand ◽  
Government Expenditure ◽  
National Income ◽  
The United States ◽  
Jel Classification ◽  
Distributed Lag ◽  
Long Run ◽  
Auto Regressive ◽  
The Government

At the end of 2019, most countries experienced an economic slowdown due to a trade war between the United States and China. According to macroeconomic theory, aggregate demand is one of the factors that influence economic growth. This study aims to add the debate and fill the gap by studying the relationship between aggregate demand and economic growth in the case of Indonesia. Using an Auto-Regressive Distributed Lag analysis, the results indicate that in the long-run, household consumption and investment had a positive effect on Indonesia's national income in 2010-2019. It means that the government must continue to make policies to maintain the purchasing power of Indonesian consumers, so that public consumption remains high, and maintaining the investment climate to be more conducive. On the other hand, government expenditure and net exports variables have no impact on Indonesia's national income in 2010-2019.JEL Classification: E01, E12, O47How to Cite:Astuti, P. B., & Khasanah, N. (2020). Determinants of Indonesia’s National Income: An Auto-Regressive Distributed Lag Analysis. Signifikan: Jurnal Ilmu Ekonomi, 9(2), 207-218. https://doi.org/10.15408/sjie.v9i2.14469.

scholarly journals Determinants of Insurance Penetration in West African Countries: A Panel Auto Regressive Distributed Lag Approach

2021 ◽  
Vol 14 (8) ◽  
pp. 350
Author(s):  
Odunayo Olarewaju ◽  
Thabiso Msomi
Keyword(s):  
Banking Sector ◽  
West African ◽  
Education Sector ◽  
African Countries ◽  
Distributed Lag ◽  
Long Run ◽  
Short Run ◽  
Auto Regressive ◽  
Insurance Penetration ◽  
The Government

This study analyses the long- and short-term dynamics of the determinants of insurance penetration for the period 1999Q1 to 2019Q4 in 15 West African countries. The panel auto regressive distributed lag model was used on the quarterly data gathered. A cointegrating and short-run momentous connection was discovered between insurance penetration along with the independent variables, which were education, productivity, dependency, inflation and income. The error correction term’s significance and negative sign demonstrate that all variables are heading towards long-run equilibrium at a moderate speed of 56.4%. This further affirms that education, productivity, dependency, inflation and income determine insurance penetration in West Africa in the long run. In addition, the short-run causality revealed that all the pairs of regressors could jointly cause insurance penetration. The findings of this study recommend that the economy-wide policies by the government and the regulators of insurance markets in these economies should be informed by these significant factors. The restructuring of the education sector to ensure finance-related modules cut across every faculty in the higher education sector is also recommended. Furthermore, Bancassurance is also recommended to boost the easy penetration of the insurance sector using the relationship with the banking sector as a pathway.

scholarly journals Export Diversification and Economic Growth in Nigeria

2019 ◽  
Vol 8 (2) ◽  
Author(s):  
Philip Ifeakachukwu Nwosa ◽  
Fasina Oluwadamilola Tosin ◽  
Ogbuagu Matthew Ikechukwu
Keyword(s):  
Economic Growth ◽  
Poor Performance ◽  
Export Diversification ◽  
Economic Policies ◽  
Oil Market ◽  
Distributed Lag ◽  
The Poor ◽  
Auto Regressive ◽  
Oil Sector ◽  
The Government

The issue of export diversification has been contentious in Nigeria due to the country’s unstable growth pattern which is majorly associated with instability in the international oil market and the poor performance of other sectors of the economy. Therefore, this study examines the link between export diversification and economic growth in Nigeria from 1962 to 2016. The study utilizes the Auto-regressive Distributed Lag (ARDL) technique. The result of this study shows that export diversification has a positive but insignificant influence on economic growth in Nigeria. The above result implies that the oil sector still dominates the Nigerian economy while the diversification drive of the government has not been significant in other sectors of the economy. Thus, the study recommends the need for conscious economic policies that would promote the diversification of the entire non-oil sector of the economy. The study concludes that export diversification is an insignificant determinant of economic growth in Nigeria.

scholarly journals Consequences of Capital formation, Trade Liberalization on the Economic Growth: Pakistan’s Experience

2015 ◽  
Vol 2 (1) ◽  
pp. 1-4
Author(s):  
Nadia Bukhari ◽  
Anjum Iqbal
Keyword(s):  
Economic Growth ◽  
Time Series Data ◽  
Trade Openness ◽  
Capital Formation ◽  
Vital Role ◽  
Series Data ◽  
Distributed Lag ◽  
Long Run ◽  
Auto Regressive ◽  
Adf Test

This study considers the long run relationship between the liberalization of trade, capital formation and the economic growth of Pakistan by using the time series data from 1975-2013. The main aim of this study is to examine that how much liberalization of trade and capital formation affects the economic growth of Pakistan in long run. The approach that has been used for empirical analysis is Auto Regressive Distributed Lag (ARDL) model. Under the ADF test capital formation (CF) is stationary at its first level but the trade openness (TO) and GDP is stationary at its first difference. Moreover, the granger casualty test is evident that there become a casual relationship between the trade openness and GDP. The result of this study shows that both the trade openness and the capital formation determined the economic growth in long run and they both have statistically significant effect on the GDP. Furthermore it has has been depicted from the study that the trade has a vital role to influence the economic growth.

scholarly journals The impact of education tax and investment in human capital on economic growth in Nigeria

2020 ◽  
Vol 3 (2) ◽  
pp. 77-86
Author(s):  
Abubakar Aminu ◽  
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Tertiary Education ◽  
Distributed Lag ◽  
Distributed Lag Model ◽  
Long Run ◽  
Lag Model ◽  
The Government ◽  
Capital Development ◽  
The Impact

This paper investigated the impact of education tax and investment in human capital on economic growth in Nigeria utilizing the Non-Linear Autoregressive Distributed Lag Model of cointegration covering the period of 25 years from 1995 to 2019. The findings reveal that education tax and investment in human capital have positive and significant effect on the growth of the Nigerian economy over the sampled period. The paper recommends that in order to boost the economy, Nigeria would need to, among other policy frameworks, provide a suitable environment for ensuring macro-economic stability through effective utilization of income from education tax that will encourage increased investment in human capital in the public sector. In addition to income from education tax, for effective and speedy economic growth and development in Nigeria, the government, beneficiaries (students/parents), employers of labor and other stakeholders in the society should share the responsibility for financing primary, secondary and tertiary education, so as to provide a solid foundation for human capital development. However, as revealed in this paper, the contribution of education tax and investment in human capital is most likely to be realized over a long-run period than in the short term. Keywords: Education Tax; Investment; Human capital; Economic growth

scholarly journals The Asymmetric Influence of Financial Development on Economic Growth in Kenya: Evidence From NARDL

SAGE Open ◽  
2020 ◽  
Vol 10 (1) ◽  
pp. 215824401989407 ◽  
Author(s):  
Hao Chen ◽  
Duncan O. Hongo ◽  
Max William Ssali ◽  
Maurice Simiyu Nyaranga ◽  
Consolata Wairimu Nderitu
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Government Spending ◽  
Capital Accumulation ◽  
Research Question ◽  
Government Expenditure ◽  
Model Specification ◽  
Long Run ◽  
Short Run ◽  
Auto Regressive

This study analyzed the asymmetric effects of financial development on economic growth using a model augmented with inflation and government expenditure asymmetries to inform model specification. The research question used entails, Do their asymmetry changes significantly influence growth? Using the nonlinear auto-regressive distributive lag (NARDL), the most significant results posit that positive shocks in financial development in the short run and its negative shocks in the long run increase and decrease economic growth, respectively. Regarding inflation, its positive (negative) shocks in both runs, respectively, reduce (increase) economic growth. In comparison, positive shocks in financial development that spur growth in the short run and negative shocks in financial development (government expenditure) that increase (reduce) growth are the most domineering effects as the rest of the shocks insignificantly affect growth. Results clearly demonstrate to an environment steered by stable and sustainable inflation that regulated government expenditure and comprehensive financial system deepening would positively cause economic growth. Therefore, appropriate policies that favor low inflation and reduced government spending, expansion of feasibly reformed financial institutions, capital accumulation, and increased resource mobilization should be instituted if real growth is to positively happen.

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.

SHORT-RUN AND LONG-RUN IMPACT OF INFLATION, UNEMPLOYMENT, AND ECONOMIC GROWTH TOWARDS POVERTY IN INDONESIA: ARDL APPROACH

2019 ◽  
Vol 2 (1) ◽  
pp. 15
Author(s):  
Ahmadi Murjani
Keyword(s):  
Economic Growth ◽  
Poverty Alleviation ◽  
Macroeconomic Variables ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
Long Run ◽  
Ardl Approach ◽  
Short Run ◽  
The Government ◽  
The Impact

 Poverty alleviation has become a vigorous program in the world in recent decades. In line with the efforts applied by the government in various countries to reduce poverty, some evaluations have been practised. The impacts of macroeconomic variables such as inflation, unemployment, and economic growth have been commonly employed to be assessed for their impact on the poverty. Previous studies in Indonesia yielded mix results regarding the impact of such macroeconomic variables on the poverty. Different methods and time reference issue were the suspected causes. This paper aims to overcome such problem by utilising the Autoregressive Distributed Lag (ARDL) equipped with the latest time of observations. This paper finds in the long-run, inflation, unemployment, and economic growth significantly influence the poverty. In the short-run, only inflation and economic growth are noted affecting poverty significantly. 

scholarly journals The Impact of Tourism Development on Economic Development: The Case of Zanzibar

2021 ◽  
pp. 41-50
Author(s):  
Hafidh Ali Hafidh ◽  
Zulekha Ayoub Rashid
Keyword(s):  
Economic Development ◽  
Government Expenditure ◽  
National Income ◽  
Tourism Development ◽  
Small Island ◽  
Stable Relationship ◽  
Long Run ◽  
Study Results ◽  
The Government ◽  
The Impact

Tourism is perceived as one of the world’s fastest growing service sectors and a major source of economic development for many, if not all, developing countries. Zanzibar as a developing country and also is a small island which have small economy, its national income depend much on tourism contribution, Therefore this paper aim to examine the impact of tourisms development to the economic development of Zanzibar, using the data based on annual time series from the period 1989–2019 and also employing Vector Error Correlation Model (VECM) to arrive at conclusions from the data in the study area. The study results found a long-run stable relationship among tourism development and economic development of Zanzibar, there is a positive and significant impact that exists between GDP and international tourism arrivals, inflation and government expenditure respectively while only inflation results show positive but insignificant impact. In order to increase the economic development in Zanzibar through the tourism sector, there is a need for the government and other stakeholders of tourism to put much consideration on this sector so as to improve overall development of Zanzibar economy.

scholarly journals An empirical nexus between poverty and unemployment on economic growth

2021 ◽  
Vol 9 (1) ◽  
pp. 85-94
Author(s):  
KEJI Sunday Anderu
Keyword(s):  
Economic Growth ◽  
Agricultural Sector ◽  
Poverty Rate ◽  
Least Square ◽  
Small Scale ◽  
Distributed Lag ◽  
Long Run ◽  
Lm Test ◽  
Short Run ◽  
The Government

The study examines the empirical nexus between poverty and unemployment on economic growth in Nigeria between 1980 and 2016. Auto-Regressive Distributed Lag (ARDL), Bound cointegration testing, and Error Correction Methods (ECM) were used to investigate the link between unemployment, poverty rate, and economic growth in Nigeria. Post estimation tests such as the Jarque-Bera test, Breusch-Pagan, ARCH test, and Ramsey reset test were also adopted in order to validate the research finding. The diagnostic tests further disclosed that the estimated model follows the Ordinary Least Square technique assumptions to attain efficiency and consistency of the model employed. The Jarque-Bera test suggests that residuals for both models are normally distributed, and the Breusch-Godfrey Serial Correlation (LM) test indicates that the hypothesis of no autocorrelation cannot be rejected. Interestingly, the ARDL and ECM results show that unemployment and poverty significantly impact economic growth both in the short and long run. Hence, the study recommended that the Nigeria government should ensure that adequate measures are put in place: Such as investment in education, agricultural sector reform, expansionary fiscal policy, intervention in micro-lending for small scale businesses by the government should be implemented to reduce the level of unemployment and poverty rate both in the short run and long run.

scholarly journals Do financial systems spur economic growth in the USA? An empirical investigation

2019 ◽  
Vol 66 (2) ◽  
pp. 165-185
Author(s):  
Sheilla Nyasha ◽  
N.M. Odhiambo
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Positive Impact ◽  
The United States ◽  
Bounds Testing ◽  
Financial Systems ◽  
Development Indicators ◽  
Distributed Lag ◽  
Long Run ◽  
The Usa

In this paper, we use the autoregressive distributed lag (ARDL) bounds testing approach to examine the dynamic impact of both bank-based financial development and market-based financial development on economic growth in the United States of America (USA) during the period 1980 to 2012. In order to adequately capture the depth and width of the USA?s financial system, we used both bank-based and marketbased financial development indices as proxies for bank-based and market-based financial systems. These indices were constructed from a number of bank- and market-based financial development indicators, using the method of means-removed average. Our empirical results reveal that both bank-based and market-based financial development have a positive impact on economic growth in the USA. These results apply irrespective of whether the regression analysis is conducted in the long run or in the short run. We, therefore, recommend that both pro-bank-based and pro-market-based financial sector development policies should be pursued in the USA - in order to bolster real sector growth and economic development.

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