scholarly journals Dynamic Labor Reallocation with Heterogeneous Skills and Uninsured Idiosyncratic Risk

2021 ◽  
pp. 01-74
Author(s):  
Ester Faia ◽  
◽  
Ekaterina Shabalina ◽  
Marianna Kudlyak ◽  
◽  
...  
Keyword(s):  
Choice Model ◽  
Occupational Mobility ◽  
Adjustment Costs ◽  
Wealth Inequality ◽  
Function Optimization ◽  
Income Risk ◽  
Labor Reallocation ◽  
Long Run ◽  
The Impact

Occupational specificity of human capital motivates an important role of occupational reallocation for the economy's response to shocks and for the dynamics of inequality. We introduce occupational mobility, through a random choice model with dynamic value function optimization, into a multi-sector/multi-occupation Bewley-Aiyagari model with heterogeneous income risk, liquid and illiquid assets, price adjustment costs, and in which households differ by their occupation-specific skills. Labor income is a combination of endogenous occupational wages and idiosyncratic shock. Occupational reallocation and its impact on the economy depend on the transferability of workers' skills across occupations and occupational specialization of the production function. The model matches well the statistics on income and wealth inequality, and the patterns of occupational mobility. It provides a laboratory for studying the short- and long-run effects of occupational shocks, automation and task encroaching on income and wealth inequality. We apply the model to the pandemic recession by adding an SIR block with occupation-specific infection risk and a ZLB policy and study the impact of occupational and aggregate labor supply shocks. We find that occupational mobility may tame the effect of the shocks but amplifies earnings inequality, as compared to a model without mobility.

scholarly journals The Impact of Financial Development On The Clean Energy Transition In MENA Region: The Role of Institutional And Political Factors.

2021 ◽  
Author(s):  
Haifa Saadaoui
Keyword(s):  
Renewable Energy ◽  
Financial Development ◽  
Energy Transition ◽  
Transition Process ◽  
Clean Energy ◽  
Mena Region ◽  
Political Factors ◽  
Long Run ◽  
The Impact

Abstract This study focuses on the role of institutional factors as well as financial development in renewable energy transition in Middle East and North Africa (MENA) region over the period 1990-2018 using the ARDL PMG method. The investigation of long-run and short-run analysis confirms that institutional and political factors play a key role in promoting the transition to renewable energy, and shows that improving these factors can lead to decarbonization of the energy sector in the long run. Another important finding is that global financial development does not have a significant effect on the transition process in the long run, implying that the whole financial system needs a fundamental structural change to accelerate the substitution between polluting and clean energies. However, in the short term, the impact appears to be negative and significant, highlighting the inadequacy of financial institutions and financial markets in promoting the region’s sustainable path. Moreover, income drives the transition to renewable energy in both short and long term. The causality results show that both financial development and institutional quality lead to renewable energy transition, while there is a bidirectional link between income and renewable energy.This study can provide a very useful recommendation to promote a clean transition in the MENA region.

scholarly journals CEO Compensation and Firm Performance: The Role of ESG Transparency

2020 ◽  
Vol 4 (2) ◽  
pp. 278
Author(s):  
Chetna Rath ◽  
Florentina Kurniasari ◽  
Malabika Deo
Keyword(s):  
Firm Performance ◽  
Chief Executive Officers ◽  
Ceo Compensation ◽  
Negative Relationship ◽  
Chief Executive ◽  
Long Run ◽  
Ceo Pay ◽  
Executive Officers ◽  
The Impact

Chief executive officers (CEOs) of environmental, social, and governance (ESG) firms are known to take lesser pay and engage themselves in corporate social responsibility activities to achieve the dual objective of the enhancement of firm’s performance as well as benefit for stakeholders in the long run. This study examines the role of ESG transparency in strengthening the impact of firm performance on total CEO pay in ESG firms. A panel of 67 firms for the period of 2014–2019 has been analyzed using the two-step system GMM model, with NSE Nifty 100 ESG Index as the data sample and ESG scores from Bloomberg database as a proxy for transparency. Findings reveal that environmental and governance disclosure scores have the potential to intensify the negative relationship between firm performance and CEO compensation, while social disclosure scores do not. In addition, various firm-specific, board-specific, and CEO-specific attributes have also been considered controls affecting remuneration. This paper contributes to the literature by exploring the effect of exhibiting ESG transparency and its nexus with CEO pay as well as firm performance.

scholarly journals The Impact of the Oil Revenues on the Standard of Living in Oil-Exporting Countries of the Former Soviet Union

2014 ◽  
Author(s):  
Cihan Bulut ◽  
Fakhri Hasanov ◽  
Elchin Suleymanov
Keyword(s):  
Soviet Union ◽  
Income Inequality ◽  
Former Soviet Union ◽  
Standard Of Living ◽  
Speed Of Adjustment ◽  
Long Run ◽  
Short Run ◽  
Oil Revenues ◽  
The Impact

The aim of our study is to examine the impact of the oil revenues on the standard of living in oil-exporting countries of the former Soviet Union and to make policy suggestions based on the obtained findings. It has been explain that resource dependency adjust the structure of these countries' economies, which leads to income inequality compensation changes in different sectors of the economy. Characteristic of resource- rich of post-Soviet oil exporters countries - Russia, Kazakhstan and Azerbaijan have been analyzed. It has been demonstrated that dependency on resources modifies the structure of these countries’ economies, which leads to income inequality based on employment via a mechanism of labor compensation changes in different sectors of the economy. We are going to employ co-integration and error correction methods in our empirical analysis. Is there a long-run relationship between the oil revenues and the standard of living in oil-exporting countries of the former Soviet Union; What is the role of dynamics of the oil revenues in the standard of living in the short run; What is the magnitude of speed of adjustment from the short-run fluctuation towards long-run equilibrium of the system; What is the direction of long- and short-run causality in the oil revenues - standard of living relationship.

scholarly journals Does Stock Market Performance Affect Economic Growth? Empirical Evidence from Saudi Arabia

2019 ◽  
Vol 11 (9) ◽  
pp. 21 ◽  
Author(s):  
Moayad H. Al Rasasi ◽  
Soleman O. Alsabban ◽  
Omar A. Alarfaj
Keyword(s):  
Economic Growth ◽  
Empirical Evidence ◽  
Stock Prices ◽  
Causality Test ◽  
Steady State Condition ◽  
Long Run ◽  
Stock Market Performance ◽  
Cointegration Tests ◽  
The Impact

This research paper investigates the impact of stock prices on real economic activity in the Saudi Arabian economy. We utilize various econometric techniques – Johansen and Juselius’s (1990) cointegration tests and Granger’s (1969) causality test – to assess such a relationship, based on quarterly observations spanning the period from the first quarter of 2010 to the fourth quarter of 2018. Our empirical evidence indicates the presence of a significant cointegrating relationship between the two variables being examined; in other words, stock prices have a significant impact on real economic growth. Specifically, the estimated long-run relationship reveals that a 1 percent increase in stock prices would boost economic growth by 0.32 percent. In addition, the error correction model suggests that when the economy deviates from its steady state condition, it needs about a year and a half to return to its equilibrium condition. Lastly, this paper applies the most common Granger causality test, which confirms the essential role of stock prices in predicting changes in economic growth.

scholarly journals Does Inflation Reduce Air Pollution? Evidence from Indonesia

2021 ◽  
Vol 317 ◽  
pp. 01068
Author(s):  
Andryan Setyadharma ◽  
Shanty Oktavilia ◽  
Indah Fajarini Sri Wahyuningrum ◽  
Sri Indah Nikensari ◽  
Arumawan Mei Saputra
Keyword(s):  
Air Pollution ◽  
Positive Impact ◽  
Methodological Approach ◽  
Long Run ◽  
High Inflation ◽  
Positive Rate ◽  
Short Run ◽  
Negative Impacts ◽  
The Impact

Inflation could likely cause devastating impacts where high inflation can harmful economic and social circumstances. However, only limited studies try to find the impact of inflation on the quality of air. The aim of this study is to investigate the empirical linkage between inflation and air pollution in Indonesia covering the period of 1981 until 2017 by using an error correction model (ECM) methodological approach. The result of study suggests that in the short run, higher inflation is causing the lower level of air pollution. Similarly, in the long run, higher inflation is also affecting the lower level of air pollution. While there are a lot of negative impacts of inflation in Indonesia, the finding in this study indicates a positive impact of inflation in Indonesia, which is higher inflation can reduce the air pollution. The results seem contradict with the target of central bank of Indonesia to have a low but positive rate of inflation. Based on the findings, the study suggests the policymakers in Indonesia to support a robust role of inflation stability in achieving targets related to the reduction of air pollution.

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 Impact of Government Expenditure on Agricultural Productivity in South Africa

2019 ◽  
pp. 1734-1742
Author(s):  
Megbowon Ebenezer ◽  
Saul Ngarava ◽  
Nsikak-Abasi Etim ◽  
Oluwabunmi Popoola
Keyword(s):  
South Africa ◽  
National Level ◽  
Government Expenditure ◽  
Agricultural Productivity ◽  
Government Funding ◽  
Series Data ◽  
Agricultural System ◽  
Long Run ◽  
The Impact

Government expenditure has been considered to be having an extent of impact on economic performance at both sectoral level and aggregate national level. Evidence from literature, however shows that this notion has not been generally accepted across countries and sectors. Considering the significance of agriculture in an economy most especially in Africa, and the consequent role of government, this study examines the impact of government expenditure on agricultural productivity in South Africa using annual time series data from 1983 to 2016. It is shown that there exists a long-run relationship between government expenditure on agriculture and agricultural productivity, and a positive significant effect only to be expected in the long-run. The finding underscores the non-negotiable role of the South African government funding of agricultural sector in an era of climate change and a highly commercialized agricultural system. Furthermore, considering the low and declining pattern of government expenditure in the sector in South Africa, the desired productivity growth impact will only be experienced in the long-run all things being equal. Improving government funding in the sector could accelerate the desired agricultural productivity in the short-term.

scholarly journals Does Export Led Growth Hypothesis Hold Under World Crisis Recovery Regime in Malaysia?

2019 ◽  
Vol 10 (5) ◽  
pp. 9
Author(s):  
Asmawi Hashim ◽  
Norimah Rambeli ◽  
Norasibah Abdul Jalil ◽  
Normala Zulkifli ◽  
Emilda Hashim ◽  
...  
Keyword(s):  
Economic Growth ◽  
International Trade ◽  
Exchange Rate ◽  
Exchange Rates ◽  
Data Series ◽  
World Crisis ◽  
Long Run ◽  
The Impact ◽  
Growth Hypothesis

This paper examines empirically the nature of the impact of the exchange rate on import, export and economic growth in Malaysia from 2009 until 2018. The objective of this study is to investigate the long-term and short-term relationship between endogenous and exogenous variables and also to identify the effects of exchange rates on dependent variables including imports, exports and the Gross Domestic Product (DGP) that represent the productivity of the country. This study further focuses on investigating the impact or the role of export in drive the county economic growth. In achieving these objectives, the Augmented Dickey-Fuller (ADF) testing procedure is used to test the presence of unit root. In order to investigate the incidence of long run relationship between the data series, the Johansen Juselius Cointegration Vector is utilized. The Granger Causality in Vector Error Correction Model (VECM) framework is employed to differentiate between short run and long run causal effects in examining the led growth determinants. The result shows that there is causality between exchange rate, import, export and GDP. Moreover, this study shows that exchange rates responded positively to import and export and negatively to GDP. The result further support for export led growth hypothesis in this study. Thus, confirm for the role of export in motivating the economic growth productivity in after World Crisis regime in year 2008. However, Malaysia must not only relay on international trade to generate income for the country. This is because Malaysia is fortunate to have survived the negative effects of the global crisis; the international trade is exposed to exchange rate instability. If Malaysia wants to succeed in international trade, it may be able to focus on food and services trade. As alternative Malaysia may focuses on agriculture sector by improving the research and development and be a champion on food supply for the world.

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.

ANALISIS PEMBIAYAAN SYARIAH ATAS NILAI TAMBAH PRODUK PERTANIAN

2016 ◽  
Vol 18 (2) ◽  
pp. 89-98
Author(s):  
Abdul Holik ◽  
Aisyah Rosadi
Keyword(s):  
Value Added ◽  
Agricultural Products ◽  
Manufacture Product ◽  
Long Run ◽  
The Impact

This research aims to find the impact of sharia finance toward the value-added of agricultural products in Indonesia, by using the data from 2005 until 2011. The OLS method was used to findcausal relationship among the variables, i.e. the value-added of agricultural products, manufacture products, and sharia finance. The result showed that sharia finance had positive significant impact on the value-added of agricultural products; meanwhile value-added of manufacture product had negative significant impact on the value-added of agricultural products. This is an evidence the important role of sharia finance in boosting agricultural value-added in the long-run, as well as for other industries.

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