scholarly journals CAN FOREIGN DIRECT INVESTMENT REDUCE UNEMPLOYMENT IN HOME COUNTRIES? ANALYSIS FOR ASEAN COUNTRY

2019 ◽  
Vol 4 (2) ◽  
pp. 143
Author(s):  
ELSA WIDIA ◽  
ENDRIZAL RIDWAN ◽  
FAJRI MUHARJA
Keyword(s):  
Empirical Studies ◽  
Direct Foreign Investment ◽  
Annual Data ◽  
Long Term Effects ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Asean Country

Direct Foreign Investment (FDI) has been considered as one of the important strategies in long-term economic development. FDI is seen not only as a capital transfer but also has an important effect on increasing the host economy. FDI then became popular in many countries, so it was interesting to analyze the effects produced, both positive and negative. This research focuses on countries in the Association of Southeast Asian Nations (ASEAN) with the aim of conducting empirical studies on opportunities for employment creation by FDI. However, due to limited data in several countries, this study only involved Indonesia, Singapore, Malaysia and Thailand. The type of data used in this study is annual data covering from 1980-2017. Using estimation Vector Error Correction Model (VECM) allows to see short-term and long-term effects. The test results prove that the influence between variables is more visible in the long run

scholarly journals Sustainable Knowledge Investment Increases Employment and GDP in the Spanish Agricultural Sector More Than Other Investments

2020 ◽  
Vol 12 (8) ◽  
pp. 3127
Author(s):  
Carolina Cosculluela-Martínez
Keyword(s):  
Agricultural Sector ◽  
First Year ◽  
Long Term Effects ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Short And Long Term ◽  
Stock Types ◽  
Processing Techniques

Investment in every type of asset increases GDP and net employment differently. This paper compares the effect produced by a permanent unitary shock in Sustainable Knowledge for the Primary Sector (SKPS) on the Spanish employment and GDP growth with the effect produced by the other fourteen capital stock types. The methodology used is a Vector Error Correction Model (VECM), where the complementary capital can affect SKPS instantaneously. The results suggest that SKPS produces the second-highest, short and long-term effects on both labor and production, per Euro invested; moreover, the investment of 4.3 thousand euros is retrieved in the first year and increases net employment in one person after four years. Accordingly, the 5 million Euro Budget to invest in sustainable machinery and processing techniques increases net employment by 827 employees.

Are house prices in the Norwegian capital too high?

2015 ◽  
Vol 8 (2) ◽  
pp. 152-168 ◽  
Author(s):  
Svein Olav Krakstad ◽  
Are Oust
Keyword(s):  
House Prices ◽  
Construction Costs ◽  
Policy Makers ◽  
Correction Model ◽  
Content Type ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Practical Implications

Purpose – This paper aims to investigate whether the homes in the Norwegian capital, Oslo, are overpriced. While house prices in many countries dropped after the financial crisis, those in Norway have continued to increase. Over the past 20 years, real house prices in Oslo have increased by around 7 per cent yearly. Design/methodology/approach – The authors use a vector error correction model to estimate the equilibrium between house prices, rents, construction costs and wages to examine whether house prices in Oslo are overpriced. Findings – Long-term relationships between house prices, rents, construction costs and wages are found and used to estimate equilibrium house prices in Oslo. The overpricing in Oslo compared to estimated equilibrium prices is around 35 per cent. Practical implications – Price–rent, price–construction cost and price–income ratios are often used, by practitioners to say something about over- or underpricing in the housing market. We test and find that house prices, rents and construction costs move toward constant ratios in the long run, while wages are found to be weakly exogenous in the system. Originality/value – Our estimate of overpricing gives households, investors and policy-makers a better understanding of the risk associated with owning dwellings.

scholarly journals Analisis Pengaruh Kinerja Keuangan terhadap Profitabilitas Bank Syariah di Indonesia

2017 ◽  
Vol 8 (2) ◽  
pp. 175
Author(s):  
Heri Sudarsono
Keyword(s):  
Error Correction ◽  
Error Correction Model ◽  
Third Party ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Factors Affecting ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run

<p>This study aimed to analyze the factors affecting the amount of profitability (ROA) provided by Islamic banking in Indonesia. The data which is used is taken from the financial report of the Shari’a Bank during the 2011-2016 periods by using montly financial statement This study uses a Vector Error Correction Model (VECM) to see the long-term effect and response to shock that occur in the studied variables. The result shows that in the long run, the percentage Financing (FIN) and BOPO give a positive siqnifikant effect on the ROA, while third party funds (DPK), percentage profit and loss sharing (TBH), financial to deposit ratio (FDR) has negative and siqnificant effect on the ROA. Sertifikat Bank Indonesia Syariah (SBIS) and non performing finance (NPF) have no significant effect on the ROA. In short run, ROA give a negatif and siqnificant effect on the ROA and FDR give a positif and siqnificant effect, while DPK, FIN, SBIS, TBH, NPF and BOPO have no sinificant effect on the ROA. Therfore, shocks that occur in the ROA, FIN, FDR , NPF dan BOPO positively responded by ROA and will be stable in the long term. While the shocks that occur in the percentage of FDR, SBIS and TBH responded negatively by financing and will be stable in the long term.</p><p>Penelitian ini bertujuan untuk menganalisis faktor-faktor yang memengaruhi profitabilitas (ROA) perbankan syariah di Indonesia. Data yang digunakan data bulanan dari laporan keuangan bank syariah periode 2010-2015. Penelitian ini mengunakan Vector Error Correction Model (VECM) untuk melihat dampak jangka panjang dan respon terhadap dampak shock pada setiap variabel terhadap pembiayaan. Hasil olah data menunjukkan bahwa FIN dan BOPO berhubungan positif terhadap ROA, sedangkan DPK, TBH, FDR berhubungan negatif terhadap dan ROA SBIS dan NPF tidak berpengaruh terhadap tingkat ROA. Dalam jangka pendek, ROA berhubungan negatif, tetapi FDR terhadap ROA berhubungan positif. Sedangkan DPK, FIN, SBIS, TBH, NPF and BOPO tidak berhubungan dengan pembiayaan. Di lain pihak, respon pembiayan terhadap goncangan yang terjadi terjadi pada ROA, FIN, FDR, NPF dan BOPO direspon positif oleh ROA. Sedangkan respon ROA terhadap goncangan yang terjadi pada FDR, SBIS dan TBH adalah negatif.</p>

THE CAUSAL RELATIONSHIP BETWEEN INSURANCE AND ECONOMIC GROWTH IN NIGERIA (1986-2010)

2012 ◽  
Vol 02 (12) ◽  
pp. 49-57
Author(s):  
TAIWO AKINLO
Keyword(s):  
Economic Growth ◽  
Interest Rate ◽  
Causal Relationship ◽  
Causality Test ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run

This study examined the causal relationship between insurance and economic growth in Nigeria over the period 1986-2010. The Vector Error Correction model (VECM) was adopted. The cointegration test shows that GDP, premium, inflation and interest rate are cointegrated when GDP is the edogeneous variable. The granger causality test reveals that there is no causality between economic growth and premium in short run while premum, inflation and interest rate Granger cause GDP in the long run which means there is unidirectional causality running from premium, inflation and interest rate to GDP. This means insurance contributes to economic growth in Nigeria as they provide the necessary long-term fund for investment and absolving risks.

scholarly journals A Study of Car Demand and Its Interdependency in Sarawak

2021 ◽  
Vol 21 (3) ◽  
pp. 997-1011
Author(s):  
Nur Zaimah Ubaidillah
Keyword(s):  
Car Ownership ◽  
Annual Data ◽  
Policy Recommendations ◽  
Fuel Price ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Mode Of Transportation ◽  
High Level

Several developing Asian countries recorded a high level of private based motorisation, specifically car and motorcycle ownership. Continuous rise in the level of private motorisations may lead to issues such as traffic congestions, high fuel consumption and pollutions. For that reason, there is a need to investigate the determinant of car ownership and the interdependency between car and motorcycle ownership in Sarawak, Malaysia. This study used time series annual data using vector error correction model (VECM) from 1980 to 2018. Based on the analysis, it is found that gross domestic product, fuel price and population density are significant determinants of car ownership. The findings revealed that as the standard of living rises, car demand increases. At the state aggregate level, it is found that there is a substitution relationship between both modes. This indicates that people are highly likely to shift from motorcycle ownership to car ownership in the long run. Based on the findings, the policy recommendations in the study include encouraging shifts to alternative modes of transport through public transport reforms as well as improving facilities for a more sustainable mode of transportation in Sarawak.

scholarly journals Free Trade: Does Myopic Policy Overlook Long-Term Gains?

2017 ◽  
Vol 22 (2) ◽  
pp. 65-88
Author(s):  
Maryiam Haroon
Keyword(s):  
Trade Liberalization ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
Myopic Policy ◽  
The Relationship

This article analyzes the correlation between trade liberalization and welfare in Pakistan from 1986 to 2015. Using consumption expenditure as a measure of welfare, we estimate the relationship using a vector error correction model. The empirical results show that trade liberalization does not have an immediate correlation with welfare: it takes some time for liberalization policies to enhance welfare. The findings also suggest that trade liberalization can help reduce poverty, decrease inequality and increase enrollment levels in the long run. But in the short run, trade liberalization has led to higher income inequality.

scholarly journals Product-level analysis of relationship between Czech koruna and Czech foreign trade

2016 ◽  
Author(s):  
Jana Šimáková
Keyword(s):  
Foreign Trade ◽  
Bilateral Trade ◽  
Long Term Effects ◽  
Commodity Trade ◽  
Correction Model ◽  
Vector Error Correction ◽  
Product Categories ◽  
Vector Error ◽  
Level Analysis

Paper is aimed to evaluate effects of exchange rates on the Czech bilateral trade divided into product categories. Paper assumes that different traded product categories are characterized by different price elasticity and every market consists of different consumer and producer behavior patterns, so the study applies territorial and commodity approach to foreign trade disaggregation. Long term effects are assessed by Johansen cointegration and short term effects by vector error correction model. Analysis for the period 1999 -2014 on the SITC 1 and 2 digit data shows that bilateral and majority of commodity trade balances are cointegrated with bilateral exchange rate.

scholarly journals ANALISIS DINAMIKA KESEJAHTERAAN PETANI DI PROVINSI JAWA TIMUR

2017 ◽  
Vol 5 (2) ◽  
pp. 222
Author(s):  
Nurisqi Amalia ◽  
Anisa Nurpita
Keyword(s):  
Interest Rates ◽  
Price Change ◽  
Considerable Proportion ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
The Interest Rate ◽  
Long Term Impact

East Java province has the largest rice field in Indonesia. East Java can contribute to improving economic growth and reducing poverty. Farmers Exchange Rate (NTP) is one indicator determinant of farmers welfare. NTP is formed from a price index related to inflation, where inflation is also formed from a price change. This study aims to analyze the dynamics of farmer’s welfare in East Java Province observed through quarterly data from 2006 quarter 2 to 2015 quarter 4 with the Vector Error Correction Model (VECM) Method. The results of this study indicate that inflation has the largest proportion and long-term impact in affecting NTP. The interest rate is a variable that affects the NTP with a considerable proportion when compared with the GRDP. Just like inflation, credit interest rates (IR) affect NTP in the long run. Meanwhile, PDRB is the only variable affecting NTP in the short term.

ANALISIS HUBUNGAN HARGA EMAS, HARGA SAHAM, NILAI TUKAR DAN SUKU BUNGA DI INDONESIA: PENDEKATAN GRANGER CAUSALITY DAN VECTOR ERROR CORRECTION MODEL (VECM)

2020 ◽  
Vol 2 (2) ◽  
Author(s):  
Junita Sriwulan ◽  
Ariusni Ariusni
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Stock Price ◽  
Gold Price ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short And Long Term

This studi aim to indentify and analyze the realtionship between Gold Price, Stock Price, Exchange rate and Interest rate in Indonesia. The type of this research is associative descriptive research. Where the data used is monthly data of time series from January 2014 to December 2019 obtained from Bank of Indonesia (BI) and hargaemas.org. Analysis model uses Granger Block Causality, Vector Error Correction Model (VECM) to see  interaction the long and short term between of variabel, Impluse Response Function (IRF) and Forecast Error Variance Decomposition (FEVD) in looking at the response of variability to the variables to the variables associated with those shown by other endogenous variables. The finding of this study indicate that:(1) There is a one way causality relationship between interest rate and gold price, where only  interest rate affects gold price. (2) In the short run, Shock of stock price, exchange rate and interest rate do not contribute to the variability of gold price in Indonesia, but shock of  exchange rate is only to variability response of gold price on long run. (3) Shock of gold price, exchange rate and interest rate do not contribute to the variability  of stock price in short term but variability of stock price is only based on long term gold price shock. (4) Exchange rate variability is contribute by stock price in the short and long term. But, in the long run shock interest rate also to the varibility of stock price. (5) Variability of interest rate is only contibuted by gold price in the short and long term in Indonesia.

Investment Analysis of Electricity Industry Based on Cointegration Model

2012 ◽  
Vol 433-440 ◽  
pp. 2400-2405
Author(s):  
Xiao Ying He ◽  
Hui Zhou
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Empirical Studies ◽  
Electricity Consumption ◽  
Annual Data ◽  
Causality Test ◽  
Vector Error Correction ◽  
Vector Error ◽  
The Relationship

By undertaking the cointegration theory with annual data over the period 1978-2008 in China, empirical studies on the relationship among power investment, electricity consumption and economic growth is carried out, and long-term equilibrium model and short-term vector error correction model are established; Granger causality test indicates that power investment is not the Granger causality of electricity consumption, while there exists bidirectional Granger causalities between electricity consumption and economic growth.

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