Emerging from the Global Crisis - Macroeconomic Challenges Facing Low-Income Countries

Policy Papers ◽  
2010 ◽  
Vol 2010 (40) ◽  
Author(s):  
Keyword(s):  
Interest Rates ◽  
Low Income ◽  
Low Income Countries ◽  
Gdp Growth ◽  
Export Demand ◽  
Global Crisis ◽  
Economic Growth Rate ◽  
Per Capita Gdp ◽  
Per Capita ◽  
The Impact

While the impact of the global crisis has been severe, real per capita GDP growth stayed positive in two-thirds of low-income countries (LICs), unlike in previous global downturns, and in contrast to richer countries. The crisis affected LICs not so much through the terms of trade or global interest rates, but rather through a sharp contraction in export demand, foreign direct investment, and remittances (oil exporters also suffered from a sharp fall in oil prices). LICs saw the sharpest decline in their economic growth rate over the last four decades. However, this slowdown followed a period of strong expansion, and real per capita GDP growth has generally held up in LICs, remaining well above growth in richer countries.

The Impact of Infrastructure on Growth in Developing Countries

2017 ◽  
pp. 40-68 ◽  
Author(s):  
Derya Yılmaz ◽  
Işın Çetin
Keyword(s):  
Developing Countries ◽  
Instrumental Variables ◽  
Dynamic Panel Data ◽  
Gdp Growth ◽  
Per Capita Gdp ◽  
Gdp Growth Rate ◽  
Generating Capacity ◽  
Catch Up ◽  
Per Capita ◽  
The Impact

Infrastructure and growth nexus has been debated in the literature since 1980s. This debate has a vital importance for the sake of developing countries. These countries need to grow faster in order to catch-up their advanced counterparts. Thus, it is important to detect the effect of infrastructure on growth. Bearing in mind this fact, we develop a standard growth regression in this present chapter using per capita GDP growth rate as a dependent variable. Infrastructure is added to the model as an index constructed from the indicators of infrastructure: total electric generating capacity, total telephone lines and the length of road network. We also employ set of instrumental variables comprising 29 developing countries between 1990 and 2014. In order to estimate our dynamic panel data we prefer GMM estimators. According to our empirical analysis, we can claim that infrastructure has a positive and significant impact on growth. But this impact is smaller than the earlier studies predict.

scholarly journals Health spending and vaccination coverage in low-income countries

2020 ◽  
Author(s):  
Francisco Castillo-Zunino ◽  
Pinar Keskinocak ◽  
Dima Nazzal ◽  
Matthew C Freeman
Keyword(s):  
Vaccination Coverage ◽  
Low Income ◽  
National Income ◽  
Health Spending ◽  
Gross National Income ◽  
Low Income Countries ◽  
Childhood Immunization ◽  
Government Health ◽  
Per Capita ◽  
The Impact

SummaryBackgroundRoutine childhood immunization is a cost-effective way to save lives and protect people from disease. Some low-income countries (LIC) have achieved remarkable success in childhood immunization, despite lower levels of gross national income or health spending compared to other countries. We investigated the impact of financing and health spending on vaccination coverage across LIC and lower-middle income countries (LMIC).MethodsAmong LIC, we identified countries with high-performing vaccination coverage (LIC+) and compared their economic and health spending trends with other LIC (LIC-) and LMIC. We used cross-country multi-year linear regressions with mixed-effects to test financial indicators over time. We conducted three different statistical tests to verify if financial trends of LIC+ were significantly different from LIC- and LMIC; p-values were calculated with an asymptotic χ2 test, a Kenward-Roger approximation for F tests, and a parametric bootstrap method.FindingsDuring 2014–18, LIC+ had a mean vaccination coverage between 91–96% in routine vaccines, outperforming LIC- (67–80%) and LMIC (83–89%). During 2000–18, gross national income and development assistance for health (DAH) per capita were not significantly different between LIC+ and LIC- (p > 0·13, p > 0·65) while LIC+ had a significant lower total health spending per capita than LIC- (p < 0·0001). Government health spending per capita per year increased by US$0·42 for LIC+ and decreased by US$0·24 for LIC- (p < 0·0001). LIC+ had a significantly lower private health spending per capita than LIC- (p < 0·012).InterpretationLIC+ had a difference in vaccination coverage compared to LIC- and LMIC that could not be explained by economic development, total health spending, nor aggregated DAH. The vaccination coverage success of LIC+ was associated with higher government health spending and lower private health spending, with the support of DAH on vaccines.

scholarly journals Health, employment and recession: the impact of the global crisis on health inequities in New Zealand

2010 ◽  
Vol 6 (4) ◽  
Author(s):  
Clair Mills
Keyword(s):  
New Zealand ◽  
Gross Domestic Product ◽  
Economic Crisis ◽  
Economic Recession ◽  
Health Inequities ◽  
Global Crisis ◽  
Per Capita Gdp ◽  
Unemployment Rates ◽  
Per Capita ◽  
The Impact

New Zealand entered a period of economic recession in early 2008, intensified by the global economic crisis of September 2008. Gross domestic product (GDP) fell consistently during 2008, and that year saw the economy’s worst performance in over a decade (The Treasury, 2010a). Real per capita GDP contracted through 2009 and, despite some market optimism in early 2010, economic indicators remain sluggish. Unemployment rates have risen and remain the highest seen since the last recession in 1997–98. The Treasury recently stated that ‘the current recovery is likely to remain muted relative to past recoveries’ (The Treasury, 2010b). 

High-Amplitude Atlantic Hurricanes Produce Disparate Mortality in Small, Low-Income Countries

2016 ◽  
Vol 10 (6) ◽  
pp. 832-837 ◽  
Author(s):  
Caleb Dresser ◽  
Jeroan Allison ◽  
John Broach ◽  
Mary-Elise Smith ◽  
Andrew Milsten
Keyword(s):  
Mortality Rate ◽  
Low Income ◽  
Negative Binomial ◽  
High Amplitude ◽  
Low Income Countries ◽  
Population Exposure ◽  
Storm Events ◽  
Per Capita Gdp ◽  
Small Countries ◽  
Per Capita

AbstractObjectivesHurricanes cause substantial mortality, especially in developing nations, and climate science predicts that powerful hurricanes will increase in frequency during the coming decades. This study examined the association of wind speed and national economic conditions with mortality in a large sample of hurricane events in small countries.MethodsEconomic, meteorological, and fatality data for 149 hurricane events in 16 nations between 1958 and 2011 were analyzed. Mortality rate was modeled with negative binomial regression implemented by generalized estimating equations to account for variable population exposure, sequence of storm events, exposure of multiple islands to the same storm, and nonlinear associations.ResultsLow-amplitude storms caused little mortality regardless of economic status. Among high-amplitude storms (Saffir-Simpson category 4 or 5), expected mortality rate was 0.72 deaths per 100,000 people (95% confidence interval [CI]: 0.16–1.28) for nations in the highest tertile of per capita gross domestic product (GDP) compared with 25.93 deaths per 100,000 people (95% CI: 13.30–38.55) for nations with low per capita GDP.ConclusionsLower per capita GDP and higher wind speeds were associated with greater mortality rates in small countries. Excessive fatalities occurred when powerful storms struck resource-poor nations. Predictions of increasing storm amplitude over time suggest increasing disparity between death rates unless steps are taken to modify the risk profiles of poor nations. (Disaster Med Public Health Preparedness. 2016;10:832–837)

Informal financial transactions and monetary policy in low-income countries: Interpolated informal credit and interest rates in Malawi

2018 ◽  
Vol 21 (1) ◽  
Author(s):  
Harold Ngalawa
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Low Income ◽  
Economic Activity ◽  
Financial Sector ◽  
Low Income Countries ◽  
Policy Outcomes ◽  
Vector Autoregressive ◽  
Financial Transactions ◽  
The Impact

Background: Official monetary data usually exclude informal financial transactions although the informal financial sector (IFS) forms a large part of the financial sector in low-income countries. Aim and setting: Excluding informal financial transactions in official monetary data, however, underestimates the volume of financial transactions and incorrectly presents the cost of credit, bringing into question the accuracy of expected effects of monetary policy on economic activity. Methods: Using IFS data for Malawi constructed from two survey data sets, indigenous knowledge and elements of Friedman’s data interpolation technique, this study employs innovation accounting in a structural vector autoregressive model to compare monetary policy outcomes when IFS data are taken into account and when they are not. Results: The study finds evidence that in certain instances, the formal and informal financial sectors complement each other. For example, it is observed that the rate of inflation as well as output increase following a rise in either formal financial sector (FFS) or IFS lending. Further investigation reveals that in other cases, the FFS and IFS work in conflict with each other. Demonstrating this point, the study finds that a rise in FFS interest rates is followed by a decline in FFS lending while IFS lending does not respond significantly and the response of FFS and IFS loans combined is insignificant. When IFS interest rates are raised, total loans decline significantly. Conclusion: The study, therefore, concludes that exclusion of IFS transactions from official monetary data has the potential to frustrate monetary policy through wrong inferences on the impact of monetary policy on economic activity.

scholarly journals The Impact of Foreign Aid on Economic Growth in Ethiopia

2012 ◽  
Vol 13 (2) ◽  
pp. 87-112
Author(s):  
Mohammed Seid Hussen ◽  
Kye Woo Lee
Keyword(s):  
Economic Growth ◽  
Foreign Aid ◽  
Positive Impact ◽  
Aid Effectiveness ◽  
Gdp Growth ◽  
Domestic Investment ◽  
Per Capita Gdp ◽  
Democratic Regimes ◽  
Per Capita ◽  
The Impact

This paper investigates the impact of foreign aid on investment and economic growth of Ethiopia for the period 1971-2010. The result indicates that foreign aid has a statistically significant positive impact on domestic investment, while aid’s positive impact on per capita GDP growth does not depend on any macroeconomic policy conditionality. Rather, aid effectiveness depends on the peculiar social, political and economic institutions of particular periods. Aid is effective during both socialist and democratic regimes. However, aid’s impact on growth was greater for socialist regimes.

scholarly journals Impact of Interest Loan, Growth of Regional Gross Domestic Product, Inflation and Economic Growth on Loans at Credit Union in West Kalimantan, Indonesia

2021 ◽  
Vol 2 (3) ◽  
pp. 37-47
Author(s):  
Maran Maran
Keyword(s):  
Economic Growth ◽  
Interest Rate ◽  
Interest Rates ◽  
Inflation Rate ◽  
Credit Unions ◽  
Credit Union ◽  
Gdp Growth ◽  
Inflation Rates ◽  
Per Capita ◽  
The Impact

 Loans or credits offered by Kopdit credit unions are a potential source of funds that need to be developed, to help accelerate the home industry and the micro and small economies. Therefore, we want to see the impact of several conditions such as the loan interest rate, GDP per capita growth, inflation rate and economic growth. Quite a number of studies have looked at the impact of interest rates, GDP growth, inflation rates and economic growth on loans or credits to banks or banking institutions. We do not look at credit or loans from banks, but on Kopdit credit unions (CU). The results of our research show that simultaneously the loan interest rate, GDP growth, inflation rate and economic growth have a strong enough influence on loans at Credit Union Credit Unions, namely 79.2454%. Partially the variable of loan interest rate, GDP growth per capita, inflation rate affects outstanding loans, while economic growth partially has no effect on outstanding loans.

scholarly journals Financial Crises, Income Levels and Access to Finance

2017 ◽  
Vol 12 (2) ◽  
pp. 112-124
Author(s):  
Halil Dincer Kaya
Keyword(s):  
Low Income ◽  
High Income ◽  
Low Income Countries ◽  
Access To Finance ◽  
Global Crisis ◽  
Middle Income ◽  
Market Capitalization ◽  
Middle Income Countries ◽  
Run Up ◽  
The Impact

Abstract In this study, we examine the impact of the 2008 Global Crisis on “access to finance” in high-income OECD, high-income non-OECD, middle-income, and low-income countries. We use three measures of access to finance. These are “Number of bank branches per 100,000 adults”, “Value traded of top 10 traded companies to total value traded (%)”, and “Market capitalization outside of top 10 largest companies to total market capitalization (%)”. During the run-up to the crisis and immediately after the crisis, we do not find any significant change in any of the three “access to finance” measures. We find that, during the crisis, only middle-income countries were affected significantly. These countries were affected in only one of the measures which is “Value traded of top 10 traded companies to total value traded (%)”. This measure went up and this change is marginally significant. We conclude that the global crisis only affected “access to finance” in middle-income countries.

The impact of a country’s level of development on the nexus between bank lending structure and economic growth

2021 ◽  
pp. 51-70
Author(s):  
I. N. Gurov ◽  
E. Y. Kulikova
Keyword(s):  
Economic Growth ◽  
Low Income ◽  
Banking Sector ◽  
Negative Impact ◽  
Positive Impact ◽  
Bank Lending ◽  
Low Income Countries ◽  
Gdp Per Capita ◽  
Per Capita ◽  
The Impact

The purpose of this paper is to determine how the impact of the bank lending structure on economic growth differs depending on the level of a country’s development. The article provides suggestions on how much one can rely on the leading growth of corporate and consumer bank lending in order to promote economic growth. The study is based on the panel data for 211 countries for the period 1990—2019 using methods of qualitative and quantitative analysis. The authors have identified three groups of the countries where the impact of the bank lending structure on economic growth is different. In the least developed and low-income countries, the leading growth of both consumer and corporate lending has a positive impact on economic growth. As GDP per capita reaches 4,700—7,000 constant 2010 U.S. dollars, the outstripping growth of consumer lending begins to negatively affect economic growth, while corporate lending continues to have a positive impact. As GDP per capita continues to increase, corporate lending also begins to negatively affect economic growth. The GDP per capita threshold level, after which the negative impact of corporate lending begins, ranges from 6,000 to 42,000 constant 2010 U.S. dollars, some estimates allow us to specify these limits from 13,000 to 22,000 constant 2010 U.S. dollars. Such broad boundaries are determined by the fact that the role of the banking sector in investments financing may differ because of the financial sector model and the national economy structure. However, our results show that in the most developed and high-income countries, faster growth in corporate lending will not contribute to economic growth. The study also finds that the share of mortgage loans in GDP has a positive but insignificant effect on economic growth in all groups of the countries.

scholarly journals Nonlinear growth effect of remittances in recipient countries: an econometric analysis of remittances-growth nexus in Bangladesh

2016 ◽  
Author(s):  
Gazi Mainul Hassan ◽  
Shamim Shakur
Keyword(s):  
Financial Development ◽  
Econometric Analysis ◽  
Growth Effect ◽  
Gdp Growth ◽  
Per Capita Gdp ◽  
Nonlinear Growth ◽  
Migrant Families ◽  
Per Capita ◽  
In The Beginning ◽  
The Impact

The paper examines the impact of inward remittances flows on per capita GDP growth in Bangladesh during 1976-2012. We find that the growth effect of remittances is negative at first but becomes positive at a later stage, an evidence of a non-linear. Unproductive use of remittances was rampant in the beginning when they were received by migrant families but better social and economic investments led to more productive utilisation of remittances receipts at later periods. This was the possible mechanism behind the U-shaped relationship. Unlike what is suggested in the literature that the effect of remittances is more pronounced in a less financially developed economy, our evidence do not show that the effect of remittances on per capita GDP growth in Bangladesh is conditional on the level of financial development.

Sign in / Sign up

Export Citation Format

Share Document