Relationship Between Military Expenditure, Economic Growth, and Social Expenditure in India, China, and Bangladesh

Author(s):  
Rajib Bhattacharyya

One of the most debated phenomena of recent times in the global scenario is whether there really exists a true opportunity cost of a sequential increase in global military expenditure across the world. The existing literature on the relationship between military expenditure and economic growth confirms that three kinds of linkages may be plausible: positive, negative, and no significant linkages. The chapter focuses on contradictions and conflicts between military expenditure and social expenditure such as health and education. The chapter also attempts to examine both the long-run and short-run relationship between defense expenditure (DE), health expenditure (HE), educational expenditure (EE), and economic growth (changes in GDP). Here the autoregressive distributed lag approach (ARDL) and error correction model (ECM) technique have been applied to examine the long- and short-run causality among the variables. The study observes that there exists no significant long-term relationship between economic growth, defense expenditure, health expenditure, and educational expenditure in India and China, but Bangladesh does have one.

Energies ◽  
2019 ◽  
Vol 12 (19) ◽  
pp. 3598 ◽  
Author(s):  
Haseeb ◽  
Kot ◽  
Hussain ◽  
Jermsittiparsert

The purpose of the current study was to examine the determinants of R&D expenditure and health expenditure of ASEAN countries. The research objectives were developed to analyze the short-term as well as the long-term impact of economic growth, environmental pollution, and energy consumption on health and R&D expenditures. The data was collected for ten years for ASEAN countries using the Auto-Regressive Distributed Lag (ARDL) approach, which helped the researcher to assess long-run as well as the short-run association of these variables. The findings revealed that environmental pollution, energy consumption, and economic growth had a significant positive impact on health expenditure as well as on R&D expenditure of ASEAN countries in long-run. The findings further revealed that environmental pollution and economic growth had a significant impact on R&D expenditure in short-run; however, there was no significant impact of energy consumption on R&D expenditure in short-run. It was also found that there was no significant impact of any of the independent variables, i.e., energy consumption, economic growth, and environmental pollution, on health expenditure in short-run. The current study and findings have significant implications in theory and practice.


2019 ◽  
Vol 20 (2) ◽  
pp. 279-296 ◽  
Author(s):  
Syed Tehseen Jawaid ◽  
Mohammad Haris Siddiqui ◽  
Zeeshan Atiq ◽  
Usman Azhar

This study attempts to explore first time ever the relationship between fish exports and economic growth of Pakistan by employing annual time series data for the period 1974–2013. Autoregressive distributed lag and Johansen and Juselius cointegration results confirm the existence of a positive long-run relationship among the variables. Further, the error correction model reveals that no immediate or short-run relationship exists between fish exports and economic growth. Different sensitivity analyses indicate that initial results are robust. Rolling window analysis has been applied to identify the yearly behaviour of fish exports, and it remains negative from 1979 to 1982, 1984 to 1988, 1993 to 1999, 2004 and from 2010 to 2013, and it shows positive impact from 1989 to 1992, 2000 to 2003 and from 2005 to 2009. Furthermore, the variance decomposition method and impulse response function suggest the bidirectional causal relationship between fish exports and economic growth. The findings are beneficial for policymakers in the area of export planning. This study also provides some policy implications in the final section.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Siphe-okuhle Fakudze ◽  
Asrat Tsegaye ◽  
Kin Sibanda

PurposeThe paper examined the relationship between financial development and economic growth for the period 1996 to 2018 in Eswatini.Design/methodology/approachThe Autoregressive Distributed Lag bounds test (ARDL) was employed to determine the long-run and short-run dynamics of the link between the variables of interest. The Granger causality test was also performed to establish the direction of causality between financial development and economic growth.FindingsThe ARDL results revealed that there is a long-run relationship between financial development and economic growth. The Granger causality test revealed bidirectional causality between money supply and economic growth, and unidirectional causality running from economic growth to financial development. The results highlight that economic growth exerts a positive and significant influence on financial development, validating the demand following hypothesis in Eswatini.Practical implicationsPolicymakers should formulate policies that aims to engineer more economic growth. The policies should strike a balance between deploying funds necessary to stimulate investment and enhancing productivity in order to enliven economic growth in Eswatini.Originality/valueThe study investigates the finance-growth linkage using time series analysis. It determines the long-run and short-run dynamics of this relationship and examines the Granger causality outcomes.


2021 ◽  
Vol 14 (27) ◽  
pp. 63-75
Author(s):  
Okpeku Lilian ONOSE ◽  
◽  
Osman Nuri ARAS ◽  

The export-led growth hypothesis states a positive relationship between the growth of exports and long-run economic growth. This study examines the validity of the export-led growth hypothesis of services exports in 5 emerging economies, including Brazil, India, Nigeria, China, and South Africa (BINCS), for the period of 1980-2019. The study employs the panel mean group autoregressive distributed lag (ARDL) procedure to identify a causal relationship between services exports and gross domestic product (GDP) per capita. The findings show that the export-led growth hypothesis in services only has a positive effect on economic growth in the short run while other variables, including foreign direct investment (FDI), gross capital formation, and labour, increase economic growth in the long run. Hence, the emerging countries should focus more on internal investment to boost growth in the long and short run.


2013 ◽  
Vol 218 ◽  
pp. 94-113
Author(s):  
ANH PHẠM THẾ ◽  
ĐÀO NGUYỄN THỊ HỒNG

This study examines the econometric and empirical evidence of both causal and long-run relationship between foreign direct investment (FDI) and economic growth in Vietnam, covering a time span of 21 years from 1991 to 2012. The recent and robust methodology of bounds testing or autoregressive distributed lag model (ARDL) approach to Cointegration is employed for the empirical analysis. This technique can capture both short-run and long-run dynamics of variables, particularly in small sample size cases. The findings indicate the existence of a Cointegration relationship between the two time series and a modest adjustment process from short-run to long-run equilibrium. Further results from Granger causality tests conducted within the error correction model confirm a bi-directional causality between economic growth and FDI over the study period.


2019 ◽  
Vol 11 (13) ◽  
pp. 3635 ◽  
Author(s):  
Adewale Samuel Hassan ◽  
Daniel Francois Meyer ◽  
Sebastian Kot

This article investigates the role of institutional quality in the oil wealth–economic growth nexus for 35 oil-exporting developing countries between 1984 and 2016. To achieve this objective, an empirical model was employed with linear interaction between oil wealth and institutional quality, and estimated by means of panel autoregressive distributed lag (ARDL) with a dynamic fixed effect estimator. From the results, a contingent effect of oil wealth on economic growth, both in the long run and in the short run, was established. Specifically, institutional quality was found to mitigate the negative effect of oil wealth on economic growth in the long run, while in the short run, institutional quality was found to enhance the positive effect of oil wealth on economic growth. Furthermore, the results provide the threshold levels of institutional quality, beyond which oil wealth enhances economic growth, both in the long run and in the short run, for the sampled countries. These results suggest that in order for oil-exporting developing countries to benefit from an increase in oil wealth, they must adopt appropriate policy measures to improve their levels of institutional quality and embed their entire oil wealth-generating mechanism in a sound institutional framework. Also of importance is that governments must ensure sustainable development through the benefits of wealth from oil.


2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jean Gaston Tamba

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.


2019 ◽  
Vol 2 (1) ◽  
pp. 15
Author(s):  
Ahmadi Murjani

 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. 


2019 ◽  
Vol 22 (1) ◽  
pp. 103-122
Author(s):  
Badri Narayan Rath ◽  
Danny Hermawan

This paper investigates, using annual data from 1980 to 2014, whether adoption of information and communication technologies (ICT) fosters economic growth in Indonesia. We employ an Autoregressive Distributed Lag cointegration technique on an augmented neoclassical growth model. The empirical results indicate a positive effect of ICT development on economic growth in both the long-run and short-run. The other regressors, such as total factor productivity, human capital, and capital per worker, also positively affect economic growth. From a policy perspective, the Indonesian government should promote ICT development through greater investment.


2018 ◽  
Vol 37 (2) ◽  
Author(s):  
Adenuga Fabian Adekoya ◽  
Nor Azam Abdul-Razak

This study examines the link between unemployment and violence by controlling for income and security expenditure as an antidote to reduce violence in Nigeria. Violence claims many lives and properties in the country, which further increased the demand for public security as tax on the nation’s resources. Also, the increased unemployment in Nigeria, deserving urgent attention to be reduced, as literature has pointed out, causes idleness, deception, frustration and anger. The idea of criminal motivation and strain as an inducement to violence are supported by evidence. Considering the nature of the variables in this study, we tested for endogeneity by using annual data set from 1980 to 2015 before proceeding to test for the long-run and short-run relationship. The Bound Test used to test the cointegration while the Autoregressive Distributed Lag Model (ARDL) approach was used to conduct endogeneity test. ARDL Instrumental Variable is also employed to determine long-run and short-run estimates. The results showed that unemployment causes violence while income as a variable to economic growth reduces violence at the 1% level of significance. Similarly, the deterrence variable of security expenditure adversely affects violence at the 10% level of significance. Therefore, this study suggests policy to promote economic growth as the means of income-employment generation among the youth and the unemployed. Youth programs should be provided especially among the unemployed by granting credit facilities to finance their own projects and further strengthen the deterrence institutions. RESUMEN Este estudio examina el vínculo entre el desempleo y la violencia mediante el control de los ingresos y el gasto de seguridad, como un antídoto para reducir la violencia en Nigeria. La violencia se cobra muchas vidas y propiedades en el país, lo que aumenta aún más la demanda de seguridad pública, traducida como un impuesto a los recursos de la nación. Además, el aumento del desempleo en Nigeria, la cual merece una atención urgente que se reduzca ya que, la literatura señala, provoca ociosidad, engaño, frustración e ira. La idea de la motivación y la tensión delictiva como un incentivo a la violencia está respaldada por la evidencia. Teniendo en cuenta la naturaleza de las variables en este estudio, probamos la endogeneidad mediante el uso de datos anuales de 1980 a 2015, antes de proceder a la prueba de la relación de largo y corto plazo. El Bound Test se usó para probar la cointegración, mientras que el enfoque del Modelo de retardo distribuido autorregresivo (ARDL), se usó para realizar pruebas de endogeneidad. La variable instrumental de ARDL también se emplea para determinar estimaciones a largo y corto plazo. Los resultados mostraron que el desempleo causa violencia; mientras que el ingreso, como variable del crecimiento económico, reduce la violencia, al nivel de significancia del 1%. De manera similar, la variable de disuasión del gasto en seguridad afecta adversamente la violencia, al nivel de significancia del 10%. Por lo tanto, este estudio sugiere una política para promover el crecimiento económico como el medio de generación de empleo-empleo entre los jóvenes y los desempleados. El empoderamiento de la juventud debe proporcionarse especialmente entre los desempleados mediante la concesión de servicios de crédito para financiar proyectos propios y fortalecer aún más las instituciones de disuasión.


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