scholarly journals Dynamic Relations Between Public External Debt and Economic Growth in African Countries: A Curse or Blessing?

2020 ◽  
Vol 6 (3) ◽  
pp. 88
Author(s):  
Benjamin Ighodalo Ehikioya ◽  
Alexander Ehimare Omankhanlen ◽  
Godswill Osagie Osuma ◽  
Ofe Iwiyisi Inua
Keyword(s):  
Economic Growth ◽  
Specific Capacity ◽  
External Debt ◽  
Economic Activities ◽  
African Countries ◽  
Development Indicators ◽  
Long Run ◽  
The World ◽  
Dynamic Relations ◽  
The Government

This paper used the Johansen Cointegration test and system Generalised Method of Moments (sysGMM) to examine the dynamic relations between external debt and economic growth in 43 African countries over the period 2001–2018. The study used data from World Development Indicators (WDI) as published by the World Bank and the World Economic Outlook database as provided by the International Monetary Finance (IMF). The study provides an understanding of how the importance of external debt could be short-lived due to its misapplication. The result reveals evidence to support a long-run equilibrium relationship between external debt and economic growth in Africa. The result demonstrates that beyond a specific capacity, the short-run converges to equilibrium in the long-run and external debt would start to have a deteriorating impact on economic growth in Africa. The findings of this study reinforce the need for policymakers to ensure proper application of external debt on economic activities that would lead to sustained long-term economic performance. Moreover, the government and development partners must put in place a monitoring mechanism to ensure the efficient use of borrowed funds.

Bivariate Causality between FDI Inflows and Economic Growth in India Since 1990

2010 ◽  
pp. 221-223 ◽  
Author(s):  
Behrooz Shahmoradi ◽  
Enayatallah Najibzadehr
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Strong Correlation ◽  
Direct Relationship ◽  
Causal Relation ◽  
Economic Activities ◽  
Fdi Inflows ◽  
Long Run ◽  
The World

Nowadays, most of the countries in the world mostly concentrate on the flow of FDI, because it has direct relationship with economic development. The present study attempts to make a contribution in this context, by analyzing the existence and nature of causalities, if any, between FDI and economic growth in India since 1990, where growth of economic activities and FDI has been one of the most pronounced. The results indicate that there is a strong correlation between FDI inflows and GDP in India. And also there is unidirectional causal relation between FDI and GDP. Finally as co-integration shows there is no long run relationship between FDI and economic growth in India.

Do corrupting activities hamper economic growth?

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
John Kwaku Amoh ◽  
Kwasi Awuah-Werekoh ◽  
Kenneth Ofori-Boateng
Keyword(s):  
Economic Growth ◽  
Structural Equation ◽  
Content Type ◽  
Development Indicators ◽  
The World ◽  
Private And Public ◽  
World Economic ◽  
Development Goals ◽  
The Government ◽  
World Development

Purpose This study aims to examine the effect of corruption on the economic growth of Ghana and to establish the strength of relationships among corrupting activities. Design/methodology/approach The research used structural equation modelling on selected data from the World Economic Forum executive opinion survey on corrupting activities and data on economic growth measures from the world development indicators to achieve the research objectives. Findings The results show that all the observed corrupting activities (except diversion of public funds) adversely influence selected economic growth indicators. The study concludes that corrupting activities, independently and mutually impede Ghana’s economic growth. Research limitations/implications The research is limited by the availability of data, hence, quarterised data on selected variables from 2008 to 2017 were examined. Practical implications The results suggest that corruption encapsulates all the seven activities of corruption to one degree or another, which are economic growth hampering. Originality/value The study extends the corruption-economic growth nexus literature by incorporating several corrupting activities from multiple sectors/areas as follows: the government and politicians, private businesses, judiciary and citizens into a single model to test how these independently and mutually impede economic growth. By identifying and using specific corrupting activities from distinct and diverse sectors/areas to capture both the supply side and demand side of corruption and the private and public sectors, a better comprehension of the corruption-economic growth nexus is attained. This may aid emerging economies and anti-corruption agencies in drafting specific and targeted corruption reduction policies/programmes to minimise poverty and raise living standards to aid the realisation of sustainable development goals.

Modelling external debt – growth nexus: how relevant is governance?

2020 ◽  
Vol 27 (4) ◽  
pp. 1323-1340
Author(s):  
Waliu Olawale Shittu ◽  
Nor Asmat Ismail ◽  
Abdul Rais Abdul Latiff ◽  
Hammed Oluwaseyi Musibau
Keyword(s):  
Economic Growth ◽  
Economic Performance ◽  
Positive Impact ◽  
External Debt ◽  
Total Effect ◽  
Content Type ◽  
Development Indicators ◽  
Long Run ◽  
Negative Effect ◽  
Sub Saharan

Purpose Amongst the major concerns of sub-Sahara Africa are the rising external debt and poor performances in governance. This paper aims to lend a voice to the relevance of governance on the relationship between external debt and economic growth in selected five sub-Saharan African (SSA) countries. Design/methodology/approach Using available data from the World Governance and Development Indicators, between 1996 and 2016, the study uses the fully-modified OLS technique after establishing the absence of unit root and existence of long-run relationship amongst the variables of the model. Findings The findings confirm a non-linear relationship between external debt and economic with a positive net effect of $5.05 increase in economic performance for a US$ rise in external debt. While the index of governance depicts a negative association with economic growth, the indicators show mixed results. The interaction effect of external debt and governance on economic performance explain that improved governance quality reduces its negative effect on economic performance by US$1.288 (with a total effect of –4.180 + 1.288*EXDBT); it equally enhances the (net) positive impact of external debt by US$1.288 (with a total effect 5.05 + 1.288*IQ). Practical implications The governments of the selected countries are, therefore, advised to seek other means of financing their expenditure while curbing financial mismanagement and its long-term impacts on growth. Also, governance infrastructures should be improved to restore both domestic and foreign investors’ confidence so that more private capitals may be attracted in lieu of excessive borrowings. Originality/value The research is the first to comprehensively examine the nexus between external debt, governance and economic growth in the selected countries, given their external debt position in SSA. This includes examining the impacts of each of the governance indicators and the comprehensive index of governance on growth. Furthermore, the study adds to the literature by examining the interaction effects of external debt and governance on economic growth of these countries. This gives both the partial and total estimates of the effects of external debt and governance on economic growth in the countries under consideration.

scholarly journals Does Financial Integration Enhance Economic Growth in China?

Economies ◽  
2020 ◽  
Vol 8 (3) ◽  
pp. 65
Author(s):  
Duc Hong Vo ◽  
Anh The Vo ◽  
Chi Minh Ho
Keyword(s):  
Economic Growth ◽  
Financial Integration ◽  
Economic Activities ◽  
Causality Test ◽  
Aggregated Data ◽  
The World ◽  
Potential Link ◽  
Auto Regressive ◽  
The Government

China is a fascinating country in Asia, the second-largest economy in the world, with incredible economic growth and development in the last two decades. In addition, China has dramatically enjoyed a disciplined and successful financial integration with the region and the world in the same period. As such, it is interesting to examine a potential link between economic growth and financial integration in this most populous country. This paper was conducted to identify whether financial integration fosters Chinese economic growth. The Auto-Regressive Distributed Lags (ARDL) model is selected, utilizing the most updated data on a globalization (or integration) index. Two distinct aspects of financial integration, the de facto (proxied for economic activities) and the de jure (proxied for the Government policies leading to integration), are considered in this paper. We apply an econometric technique, using yearly aggregated data, to examine a long-term co-integration and a causal relationship between financial integration and economic growth in China. Findings from this paper indicate a long-term co-integration between financial integration de facto and economic growth in China. The bidirectional causality between financial integration and economic growth in China is also confirmed using the Granger causality test.

scholarly journals External Debt, Public Investment and Economic Growth in Cameroon

2021 ◽  
Vol 2 (4) ◽  
pp. 260-273
Author(s):  
Forbe Hodu Ngangnchi ◽  
Roland Joefendeh
Keyword(s):  
Economic Growth ◽  
Time Series Data ◽  
Public Investment ◽  
External Debt ◽  
Ordinary Least Squares ◽  
Series Data ◽  
Growth Time ◽  
Development Indicators ◽  
Private Sector Development ◽  
Long Run

This study investigates the extent to which external debt and public investment contributes to economic growth in Cameroon - emphasising on how public investment modulates the effect of external debt on economic growth. Time series data spanning the period 1980-2018 obtained from the World Bank’s world development indicators are used, together with the Dynamic Ordinary Least Squares (OLS) approach to ascertain the nature of the long-run relationship between external debt, public investment and economic growth. Consistent with the debt-overhang and crowding-out literature, the study reveals a negative significant influence of external debt on economic growth in Cameroon. Results also reveal that there is a positive and significant direct effect of public investment on economic growth in the long run. Further results indicate that public investment and external debt positively and significantly engender economic growth. This is evidence that public investment is modulating the effect of external debt on economic growth in Cameroon. These findings suggest the need for developing country governments to create an enabling environment for private sector development, while accompanying external debt resources with domestic revenue mobilization by broadening the tax base - taxes on landed property being potential candidates

Is the Chilean “Miracle” Sustainable?

1995 ◽  
Vol 37 (3) ◽  
pp. 1-8 ◽  
Author(s):  
Osvaldo Sunkel
Keyword(s):  
Economic Growth ◽  
Social Equity ◽  
International Economy ◽  
Long Run ◽  
Official Policy ◽  
The World ◽  
The Government ◽  
The Way

In recent years, Chile has arrived at a significant consensus regarding a number of subjects central to the country's development; and, notwithstanding certain important differences between the Concertación government and its opposition, there is considerable agreement regarding certain basic aspects of economic growth which will doubtless continue to be maintained in the mid-to-long run.The official policy, as laid down by the government, is that Chile's economy is now oriented toward achieving growth with social equity, and that the way to reach those goals is by strengthening the country's insertion into the international economy, since the world is now moving towards a globalization which no country can afford to ignore. Given this new reality, the Chilean economy is also moving to take part in this process in a strategy that has proved fairly successful in recent years.

scholarly journals Public Debt and Economic Growth in Switzerland

2021 ◽  
Vol 3 (2) ◽  
pp. 39-47
Author(s):  
Daniel Lim ◽  
Michael Groschek
Keyword(s):  
Economic Growth ◽  
Economic Theory ◽  
Public Debt ◽  
Positive Influence ◽  
Outcome Variable ◽  
Development Indicators ◽  
Developed Economies ◽  
Long Run ◽  
Auto Regressive ◽  
The Government

Economic theory suggests that a realistic level of borrowing is beneficial for both developing and developed economies in achieving sustainable level of economic growth. However, as a result of insufficient domestic resources to fund the “development projects”, required for the economic progress, most of the countries strongly rely on internal (domestic) and external (international) capitals such as public debt, foreign direct investment (FDI) and remittances. Keeping in mind this significance, this study analyzes the role of public debt, FDI and remittances in accelerating the economic growth in Switzerland. For getting this purpose achieved, the study gathers the data from world development indicators (WDI) for the period of 1997-2016. The study uses public debt, FDI and remittances as predictors, while economic growth is taken as outcome variable. The study applies auto regressive distributive lag (ARDL) model to analyze the data. Results of the study show positive influence of public debt, FDI and remittances on the economic growth of Switzerland which is in line with the economic theory. Based on the findings, the study suggests articulating and implementing policies aimed at attracting more inflows of foreign capital that will positively contribute to economic growth in the long run. The study furthers the government of Switzerland to keep debts to the GDP threshold as low as possible.

The Use of Social Media by the Botswana Government and Governance of Liquid Communication

Mousaion ◽  
2019 ◽  
Vol 37 (1) ◽  
Author(s):  
Tshepho Lydia Mosweu
Keyword(s):  
Social Media ◽  
Customer Service ◽  
Community Involvement ◽  
Media Content ◽  
Service Access ◽  
Communication Tool ◽  
African Countries ◽  
The World ◽  
The Government ◽  
Use Of Social Media

Social media as a communication tool has enabled governments around the world to interact with citizens for customer service, access to information and to direct community involvement needs. The trends around the world show recognition by governments that social media content may constitute records and should be managed accordingly. The literature shows that governments and organisations in other countries, particularly in Europe, have social media policies and strategies to guide the management of social media content, but there is less evidence among African countries. Thus the purpose of this paper is to examine the extent of usage of social media by the Botswana government in order to determine the necessity for the governance of liquid communication. Liquid communication here refers to the type of communication that goes easily back and forth between participants involved through social media. The ARMA principle of availability requires that where there is information governance, an organisation shall maintain its information assets in a manner that ensures their timely, efficient and accurate retrieval. The study adopted a qualitative case study approach where data were collected through documentary reviews and interviews among purposively selected employees of the Botswana government. This study revealed that the Botswana government has been actively using social media platforms to interact with its citizens since 2011 for increased access, usage and awareness of services offered by the government. Nonetheless, the study revealed that the government had no official documentation on the use of social media, and policies and strategies that dealt with the governance of liquid communication. This study recommends the governance of liquid communication to ensure timely, efficient and accurate retrieval when needed for business purposes.

An Econometric Analysis on the Relationship between Globalisation and Inequality in South Africa

2020 ◽  
Vol 11 (1) ◽  
pp. 89-89
Author(s):  
Jacques de Jongh
Keyword(s):  
South Africa ◽  
Well Being ◽  
Causality Analysis ◽  
Global Integration ◽  
Development Indicators ◽  
Long Run ◽  
The World ◽  
Distribution Of Resources ◽  
Short Run ◽  
The Impact

Globalisation has had an unprecedented impact on the development and well-being of societies across the globe. Whilst the process has been lauded for bringing about greater trade specialisation and factor mobility many have also come to raise concerns on its impact in the distribution of resources. For South Africa in particular this has been somewhat of a contentious issue given the country's controversial past and idiosyncratic socio-economic structure. Since 1994 though, considerable progress towards its global integration has been made, however this has largely coincided with the establishment of, arguably, the highest levels of income inequality the world has ever seen. This all has raised several questions as to whether a more financially open and technologically integrated economy has induced greater within-country inequality (WCI). This study therefore has the objective to analyse the impact of the various dimensions of globalisation (economic, social and political) on inequality in South Africa. Secondary annual time series from 1990 to 2018 were used sourced from the World Bank Development indicators database, KOF Swiss Economic Institute and the World Inequality database. By using different measures of inequality (Palma ratios and distribution figures), the study employed two ARDL models to test the long-run relationships with the purpose to ensure the robustness of the results. Likewise, two error correction models (ECM) were used to analyse the short-run dynamics between the variables. As a means of identifying the casual effects between the variables, a Toda-Yamamoto granger causality analysis was utilised. Keywords: ARDL, Inequality, Economic Globalisation; Social Globalisation; South Africa

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.

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