Wage- and profit-led growth regimes: a panel-data approach

2021 ◽  
Vol 9 (3) ◽  
pp. 394-412
Author(s):  
Guilherme de Oliveira ◽  
Eduardo Prado Souza
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Panel Data ◽  
Latin American ◽  
Structural Characteristics ◽  
Developed Countries ◽  
Domestic Investment ◽  
Growth Regime ◽  
Investment Function ◽  
Trade Channel

The extensive empirical effort made in the growth and distribution literature to estimate whether economic growth is wage- or profit-led has not sufficiently considered the theoretical foundation of the Neo-Kaleckian model. This paper attempts to respect key tenets of the investment function by estimating a panel-data model in which country-specific structural characteristics and possible endogenous relationships in income distribution and economic growth are explicitly considered. The identification strategy is based on several estimates of the capital stock and the rate of capacity utilization for 61 countries over the period between 1995 and 2014. The main results suggest that the growth regime was wage-led in developed countries, while most developing countries exhibited a profit-led growth regime. Interestingly, however, while the profit-led regime occurs through the international trade channel in Latin American countries, in other developing countries, the causality channel is mainly related to the domestic investment function.

Impact of Trade Openness on Economic Growth in Emerging Economies: A Panel Data Analysis

2021 ◽  
Vol 9 (2) ◽  
pp. 210-216
Author(s):  
Muhammad Atiq Ur Rehman ◽  
Ruqia Shaheen ◽  
Farzana Munir
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Panel Data ◽  
Emerging Economies ◽  
Panel Data Analysis ◽  
Trade Openness ◽  
Generalized Method Of Moments ◽  
Developed Countries ◽  
Export Promotion ◽  
Promotion Strategies

The role of international trade in boosting economic growth is imperative in the era of globalization and trade liberalization. A trade openness policy can help stimulate economic growth mainly in two ways. Firstly, technology is transferred from developed countries to developing countries through imports. Secondly, the export promotion strategies facilitate the innovations and inventions promoting competition among the producers. In this way, research-intensive specialization culture is flourished in developing countries. This study aims at examining the effect of global trade orientation on growth in 23 emerging economies for the period 1995-2018. The panel data estimation approach including fixed effect and generalized method of moments (GMM) reveal a positive and statistically significant influence of trade openness on economic growth.  The empirical results are robust to the various specifications, supporting the trade-led growth notion in the economies under consideration. The emerging economies can achieve higher growth rates through trade openness and export promotion strategies.

The Impact of FDI Inflows and Outflows on Economic Growth: An Empirical Study of some Developed and Developing Countries

2019 ◽  
Vol 6 (1) ◽  
pp. 129-157
Author(s):  
Younis Ali Ahmed ◽  
Roshna Ramzi Ibrahim
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Panel Data ◽  
Fixed Effects ◽  
Positive Impact ◽  
Developed Countries ◽  
Fdi Inflows ◽  
Panel Data Estimation ◽  
The Impact ◽  
Data Estimation

FDI is an investment including a long-term relationship and reflecting a lasting interest and control of a resident entity in one economy. FDI is a combination of capital, technology, marketing and management. Based on the Neoclassical, Exogenous and modern theories FDI has a positive role in accelerating economic growth and development. Many countries are improving their economy in order to attract FDI.  The main objective of this study is to examine the impact of FDI inflows and outflows on economic growth of developed countries such as (USA, UK and France) and developing countries such as (Malaysia, Turkey and Iran) from (1980 to 2017). To accomplish that, ARDL approach and panel data estimation were used. The empirical findings reveal that the FDI inflows and outflows for developed countries (US and UK) have a positive impact on economic growth (GDP), while the FDI inflows of France have a negative impact. Nevertheless, FDI inflows and outflows for developing countries of (Malaysia, Turkey, and Iran) have a positive impact on economic growth. The result of panel data estimation shows that Fixed effects model is appropriate for estimating the parameters. In conclusion, Developing countries should diversify their FDI inflows and outflows to cover all the sectors and they should benefit from the developed countries’ experiences with higher impact of FDI on economic growth.

Analysis of Major Problems Faced by Small Firms in North India

2015 ◽  
Vol 15 ◽  
pp. 150-160
Author(s):  
Davinder Singh ◽  
Jaimal Singh Khamba ◽  
Tarun Nanda
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Economic Development ◽  
Small Firms ◽  
Small And Medium Enterprises ◽  
Developed Countries ◽  
North India ◽  
Small Enterprises ◽  
Employment Generation ◽  
Medium Enterprises

Micro, Small and Medium Enterprises (MSMEs) have been noted to play a significant role in promoting economic growth in less developed countries, developing and also in developed countries. Worldwide, the micro and small enterprises have been accepted as the engine of economic growth of any nation. Small and Medium Enterprises are the backbone of the economies, because it trigger employment, output, export, poverty alleviation, economic empowerment, economic development etc. in developed as well as in developing countries. It is more important to developing countries as the poverty and unemployment are burning problems. MSMEs have been playing a momentous role in overall economic development of a country like India where millions of people are unemployed or underemployed. Therefore, the growth of small sectors is essential for the growth in the GDP, employment generation, total manufacturing production and export. India, being one of the fastest growing economies of the world, needs to pay an honest attention for the utmost growth of MSMEs for its increased contribution in above areas.

scholarly journals How Do Budget Deficits and Economic Growth Affect Reelection Prospects? Evidence from a Large Panel of Countries

2008 ◽  
Vol 98 (5) ◽  
pp. 2203-2220 ◽  
Author(s):  
Adi Brender ◽  
Allan Drazen
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Fiscal Policy ◽  
Growth Rates ◽  
Electoral System ◽  
Developed Countries ◽  
Economic Conditions ◽  
New Democracies ◽  
Budget Deficits ◽  
Large Panel

We test whether good economic conditions and expansionary fiscal policy help incumbents get reelected in a large panel of democracies. We find no evidence that deficits help reelection in any group of countries independent of income level, level of democracy, or government or electoral system. In developed countries and old democracies, deficits in election years or over the term of office reduce reelection probabilities. Higher growth rates over the term raise reelection probabilities only in developing countries and new democracies. Low inflation is rewarded by voters only in developed countries. These effects are both statistically significant and quite substantial quantitatively. (JEL D72, E62, H62, O47)

scholarly journals Impact of foreign direct investment, remittances and official development assistance on economic growth: panel data approach

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Amna Zardoub ◽  
Faouzi Sboui
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Foreign Direct Investment ◽  
Panel Data ◽  
Direct Investment ◽  
Development Assistance ◽  
Business Environment ◽  
Official Development Assistance ◽  
Financial Flows ◽  
Content Type

PurposeGlobalization occupies a central research activity and remains an increasingly controversial phenomenon in economics. This phenomenon corresponds to a subject that can be criticized through its impact on national economies. On the other hand, the world economy is evolving in a liberalized environment in which foreign direct investment plays a fundamental role in the economic development of each country. The advent of financial flows – FDI, remittances and official development assistance – can be a key factor in the development of the economy. The subject of this article is to analyses the effect of financial flows on economic growth in developing countries. Empirically, different approaches have been employed. As part of this work, an attempt was made to use a panel data approach. The results indicate ambiguous effects and confirm the results of previous work.Design/methodology/approachThe authors seek to study the effect of foreign direct investment, remittances and official development assistance (ODA) and some control variables i.e. domestic credit, life expectancy, gross fixed capital formation (GFCF), inflation and three institutional factors on economic growth in developing countries by adopting the panel data methodology. Then, the authors will discuss empirical tests to assess the econometric relevance of the model specification before presenting the analysis of the results and their interpretations that lead to economic policy implications. As part of this work, the authors have rolled panel data for developing countries at an annual frequency during the period from 1990 to 2016. In a first stage of empirical analysis, the authors will carry out a technical study of the heterogeneity test of the individual fixed effects of the countries. This kind of analysis makes it possible to identify the problems retained in the specific choice of econometric modeling to be undertaken in the specificities of the panel data.FindingsThe empirical results validate the hypotheses put forward and indicate the evidence of an ambiguous effect of financial flows on economic growth. The empirical findings from this analysis suggest the use of economic-type solutions to resolve some of the shortcomings encountered in terms of unexpected effects. Governments in these countries should improve the business environment by establishing a framework that further encourages domestic and foreign investment.Originality/valueIn this article, the authors adopt the panel data to study the links between financial flows and economic growth. The authors considered four groups of countries by income.

scholarly journals Service Export Sensitivity to Internet Adoption: Evidence From Dynamic Panel Data Analysis

2020 ◽  
Vol 11 (6) ◽  
pp. 259
Author(s):  
Walid Chatti ◽  
Haitham Khoj
Keyword(s):  
Developing Countries ◽  
Panel Data ◽  
Panel Data Analysis ◽  
Developed Countries ◽  
Dynamic Panel Data ◽  
Dynamic Panel ◽  
Internet Adoption ◽  
The Impact ◽  
Dynamic Panel Data Analysis ◽  
Service Export

This study aims to examine the causal linkages relating service exports to internet penetration for 116 countries over the period 2000-2017. Taking into account a wide panel of countries, we apply 2-Step GMM methodology for dynamic panel data models. The results show a bi-directional causality relating service exports to internet adoption for developed countries. For the global panel and developing countries, we find those same results attest a positive relationship between the internet adoption and service exports, but in the opposite way; the impact is very low and not significant. Regarding developing countries, despite the fact that internet positively affects service exports, it is considered less efficient than in developed countries.

scholarly journals How do Poverty and Income Inequality affect Economic Growth in Developing Countries?

2021 ◽  
Vol 4 (2) ◽  
pp. 547-558
Author(s):  
Hamza Saleem ◽  
Fatima Farooq ◽  
Muhammad Aurmaghan
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Panel Data ◽  
Income Inequality ◽  
Negative Impact ◽  
Positive Impact ◽  
Development Indicators ◽  
The Relationship ◽  
Positive Effect ◽  
World Development

The major objective of this research is to examine the relationship between poverty, income inequality and economic growth from some selected developing countries. This study uses panel data for the period of 2002-2015. All the data is taken from world development indicators (WDI). To find out the results, we have used Hausman test an econometrics technique for panel data in this research. The results of the study indicate that poverty and income inequality have a negative impact on economic growth on the other hand Gross capital formation, labor force, total population and government consumption and expenditure have a positive impact on economic growth. The result tells us that changes in these variables have a significant and positive effect on the dependent variable. To achieve the goal of economic growth developing countries should reduce poverty and take meaningful steps to overcome the problem of inequality in the society which can be very helpful in achieving the goal of economic growth.

scholarly journals The nexus between energy consumption, economic growth, and urbanization in Latin American and Caribbean countries: An approach with PVAR model

2017 ◽  
Vol 2 (2) ◽  
pp. 202-219 ◽  
Author(s):  
Matheus Koengkan
Keyword(s):  
Economic Growth ◽  
Energy Consumption ◽  
Panel Data ◽  
Latin American ◽  
Caribbean Region ◽  
Vector Autoregressive ◽  
Data Vector ◽  
Latin America And Caribbean ◽  
The Relationship ◽  
Latin American And Caribbean

The nexus between energy consumption, economic growth and urbanization was analyzed for a panel of twenty-one Latin American and Caribbean countries over a period from 1980-2014. The Panel Data Vector Autoregressive (PVAR) was used in order to analyze the relationship among all variables. The results indicated that there is a unidirectional relationship between urbanization and energy consumption, and a bidirectional nexus among economic growth and energy consumption in Latin America and Caribbean region.

scholarly journals PERAN STRATEGIS PENERAPAN KONSEP SISTER CITY DALAM MENCIPTAKAN SURABAYA GREEN-CITY

2018 ◽  
Vol 2 (1) ◽  
pp. 144-151
Author(s):  
Inggang Perwangsa Nuralam
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Urban Areas ◽  
Developed Countries ◽  
City Development ◽  
Rapid Population Growth ◽  
Good Practices ◽  
Environmentally Sound ◽  
Complex Activities ◽  
Green City

Indonesia has many big cities with dynamic urbanization trend, increased economic growth and activities, rapid population growth, and dense populations such as Jakarta, Bandung, Medan, Surabaya and Balikpapan. As a result, the complex activities of people in urban areas need space and these needs cause environmental degradation, such as the practice of throwing garbage that is not in place. To prevent this in the future, it is important for developing countries like Indonesia to have benchmarks. Benchmarks for developing countries can come from developed countries. So far inter-city development usually has partnerships with cities abroad, including the sister city concept. Sister city practices can be used by cities in Indonesia for the development of good practices. The collaboration of Surabaya (Indonesia) with Kitakyushu (Japan) focuses a lot on creating urban planning that is environmentally sound or commonly known as green city or eco-city.

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