scholarly journals Is Greenfield Investment Greener for the Welfare of Lower-Middle Income Countries? Market based Empirical Analysis with GMM Approach

2021 ◽  
Vol 3 (3) ◽  
pp. 194-206
Author(s):  
Ali Raza ◽  
Muhammad Iqbal ◽  
Nasir Hussian
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Income Group ◽  
Economic Activities ◽  
Host Countries ◽  
Middle Income ◽  
Middle Income Countries ◽  
Middle Income Group ◽  
One Step ◽  
Complete Data Analysis

Globalization is considered as the catalyst for the progress of economic activities and economic development of lower-middle-income countries. Greenfield investment not only promotes welfare but also helps in the health and education sector of these countries. This study examined thirty-four (34) sampled countries of the lower-middle-income group from different regions for a time span of 1998-2017. Im, Pesaran and Shin (2003) test is applied for testing panel unit root and one step system GMM technique is applied for the complete data analysis. The results of the study concluded that greenfield investment has increased economic growth and helped to push the welfare activities of sampled countries. Besides the increase in economic growth and welfare, greenfield investment also brings improvement in the health and education sectors through the transfer of new and advanced technologies from the developed nation firms to the host countries. Therefore, lower-middle-income countries must approve soft and friendly economic and business policies for the attraction of foreign investors from abroad. Such policies will help in promoting and increasing economic activities and economic development of the sampled countries.

scholarly journals The potential role of aid in escaping the middle-income trap

2020 ◽  
Vol 42 (4) ◽  
pp. 420-441
Author(s):  
Timothy Yaw Acheampong ◽  
Beáta Udvari
Keyword(s):  
Economic Growth ◽  
Latin American ◽  
Income Group ◽  
Annual Growth Rate ◽  
Middle Income ◽  
Middle Income Countries ◽  
Income Status ◽  
Middle Income Group ◽  
Middle Income Trap ◽  
The Impact

AbstractRecently, the middle-income trap (MIT) has gained considerable attention – besides European countries, several African, Asian, and Latin-American developing countries are also affected. Many countries have remained in the middle-income bracket for decades, whilst only a few have advanced to high-income status. Felipe et al. in 2012 showed that an annual growth rate of at least 3.5 and 4.7% sustained for a period of 14 and 28 years is required respectively for upper-middle-income and lower-middle-income countries to escape the MIT. Economic growth is influenced by several factors including foreign aid received. Thus, in this study, we aim to answer the question of how aid affects economic growth in middle-income countries and whether aid may contribute to escaping the MIT. Focusing on the countries that have remained in the middle-income group between 1990 and 2017, our analysis confirms that aid contributes to economic growth; however, the impact is positive in the upper-middle-income countries and negative in the lower-middle-income countries. Aid is therefore, likely to be more effective in helping the upper-middle income countries to escape the MIT but not the lower-middle income countries.

scholarly journals FDI & economic growth in selected Country groups for (1989-2018)

2020 ◽  
Vol 9 (3) ◽  
pp. 196
Author(s):  
Khalil Gh. Hassan
Keyword(s):  
Economic Growth ◽  
Low Income ◽  
Null Hypothesis ◽  
Time Series Data ◽  
Income Group ◽  
Low Income Countries ◽  
Series Data ◽  
Host Countries ◽  
Middle Income ◽  
Middle Income Group

Theoretically, it is heavily believed that FDI is as a source of development, modernization, income, and employment growth and that FDI boosts the productivity of host countries and promotes economic growth. This paper examines, within a growth theory framework, the role which foreign direct investment (FDI) plays in the growth process in the context of different income group countries characterized by their per capita income. The paper tests (using time series data relating High, Middle- and Low-income countries) the hypothesis adopted is that FDI, enhance economic growth. The estimated indicators show evidence of rejecting Null hypothesis in the case of High- and Middle-income group countries but, vice versa the Null hypothesis is accepted for Low-income group countries.

scholarly journals Financial Inclusion between Financial Innovation and Economic Growth A Study of Lower Middle Income Economies

2021 ◽  
Vol 7 (4) ◽  
Author(s):  
Hina Affandi ◽  
Qaisar Ali Malik
Keyword(s):  
Economic Growth ◽  
Financial Innovation ◽  
Income Group ◽  
Financial Inclusion ◽  
Sample Period ◽  
Middle Income ◽  
Underserved Community ◽  
Middle Income Group ◽  
The Relationship

Financial inclusion is a key concern that has achieved much impulsion in the last two decades internationally. It has the scope of reporting of financial scheme and institutions to the underserved community in the economy. This study examined the effect of financial innovation on economic growth with the mediation of financial inclusion. To address the relationship researchers in this study have used measures from a dataset of low and lower middle income group economies over a sample period from 2010-2017. The results of this study shows that financial innovation creates opportunities for financially excluded segment of the society which results in financial inclusion that leads to economic growth of low and lower middle economies. Therefore, financial innovation is a way for creation of financial inclusion in low and lower middle economies. 

scholarly journals Landlessness, Economic Activities and Household Income in the Red River Delta, Vietnam

2020 ◽  
Author(s):  
Quang Vu ◽  
Tuyen Quang Tran
Keyword(s):  
Rural Households ◽  
Income Group ◽  
River Delta ◽  
Red River ◽  
Economic Activities ◽  
Red River Delta ◽  
Middle Income ◽  
Self Employment ◽  
Middle Income Group ◽  
Wage Earning

Abstract The main aim of the current study is to investigate the influence of landlessness and landholding on the choice of livelihoods among rural households in the Red River Delta. Among five livelihoods adopted by local households, we find that the highest income derives from formal wage earning, the lowest from agricultural and informal wage-paying livelihoods. The middle income group comprises livelihoods based on formal wage-paying jobs and other sources, and nonfarm self-employment and other income. Notably, the study provides evidence that landlessness or land shortage is not a potential barrier preventing rural households from pursuing gainful livelihoods in the Red River Delta. Specifically, households affected by landlessness or a shortage of land tend to adopt non-farm livelihoods that are more profitable than agricultural livelihoods. The finding suggests that landlessness or shortage of land should not be viewed as an absolutely negative phenomenon in the region.JEL codes: K25; Q15; Q12: Q57

scholarly journals Analysis of the impact of information communication technology on economic growth: empirical evidence from Asian countries

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Meta Ayu Kurniawati
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Communication Technology ◽  
High Income ◽  
Information Communication ◽  
Asian Countries ◽  
Middle Income ◽  
Content Type ◽  
Middle Income Countries ◽  
Ict Infrastructure

PurposeThis study examines the causal relationship between information communication technology (ICT) and economic growth in high-income and middle-income Asian countries.Design/methodology/approachThis study utilises a high-quality data from 25 Asian countries from 2000 to 2018. This study presents the robustness results by employing panel cointegration and estimation procedures to account for the endogeneity and cross-sectional dependence issues.FindingsThe results illustrate that high-income Asian countries have achieved positive and significant economic development from high Internet penetration. Additionally, the middle-income countries have started to benefit from ICT Internet. The findings show that the telephone line and mobile phone penetration is highly capable of promoting economic growth in middle-income Asian countries.Practical implicationsIn high-income Asia countries, an appropriate ICT infrastructure policy will support feasible ICT penetration, which may drive the processes of economic development and innovation that contribute to economic growth. Moreover, in middle-income Asian countries, the establishment of better-quality ICT service and infrastructure is more critical. Policymakers should accommodate sufficient support to establish the ICT infrastructure and expand ICT penetration.Originality/valueThis study reveals that high-income Asian countries have been more proactive and effective than middle-income countries in embracing ICT to foster economic growth. Examining the case of high-income and middle-income Asian countries provides comprehensive insight for policymakers regarding the relevance of ICT in boosting economic growth through the advantages of technology expansion.

Trapped in the Middle?

2020 ◽  
Keyword(s):  
Low Income ◽  
Income Group ◽  
Middle Income ◽  
Middle Income Countries ◽  
Income Status ◽  
Middle Income Group ◽  
Policy Measures ◽  
Analytical Approaches ◽  
New Evidence ◽  
Global Population

There is growing evidence that overcoming the low-income threshold and reaching middle-income status is not sufficient for countries to converge toward high-income levels. Few middle-income countries have successfully completed that transit in recent decades, with the majority remaining in the middle-income group, and so facing what has come to be called"the middle-income trap". It is therefore essential to explore whether middle-income traps really exist and, if they do, how these pitfalls are manifested, what their causes are, what economic policy measures are required to escape from them, and what international cooperation can do to support this process. Trapped in the Middle? brings together diverse perspectives on these important questions, providing new evidence and analytical approaches to enrich the debate on the domestic and international challenges faced by a significant number of middle-income countries, in which over three-quarters of the global population live.

The Relevance of Science in Development

2014 ◽  
pp. 1-17 ◽  
Author(s):  
Klaus Jaffe
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
National Income ◽  
Scientific Productivity ◽  
Economic Policies ◽  
Middle Income ◽  
Developed Economies ◽  
Middle Income Countries ◽  
Wealth Of Nations ◽  
Relative Productivity

Scientific knowledge and technical expertise promote the wealth of nations. The traditional view is that science allows the expansion of technology, which, in turn, promotes economic development. This chapter shows that: 1) the scientific productivity of a country correlates more strongly with gross national income per capita than its technological sophistication; 2) science is important for economic growth among developed economies, whereas technical complexity is more important for the economic development of poorer countries; 3) scientific productivity of countries correlates more strongly with present and future wealth than indices reflecting its financial, social, economic, or technological sophistication; and 4) middle-income countries with higher relative productivity in basic sciences such as physics and chemistry have the highest economic growth in the following five years compared to countries with a higher relative productivity in applied sciences. No simple direct causal relationship between scientific productivity and economic growth could be detected. The results are best explained by assuming that science favors economic development by providing society with a more rational atmosphere, allowing the implementation of sound policies and institutions, and/or that rational societies with successful economic policies are also the ones giving priority to basic natural sciences.

scholarly journals Financial Globalization, Output Gap and Foreign Output Gap on inflation: Evidenced from Developing Economies

2021 ◽  
Vol 7 (2) ◽  
pp. 411-425
Author(s):  
Muhammad Azhar Bhatti ◽  
Imran Sharif Chaudhry ◽  
Hafeez-ur- Rehman ◽  
Furrukh Bashir
Keyword(s):  
Low Income ◽  
Political Institutions ◽  
Inflation Rate ◽  
Developing Economies ◽  
Income Group ◽  
Output Gap ◽  
Middle Income ◽  
Middle Income Countries ◽  
Income Groups ◽  
Middle Income Group

This paper covers previous studies' deficiencies and re-examine the theoretical model using a heterogeneous panel GMM technique, which overcomes cross-section dependency. In the current sample of developing nations, developed two models'; model 1 consists of the domestic output gap, and the second model includes the foreign output gap. According to model 1, foreign globalization and imports boost the inflation level in developing countries and disaggregation analysis (low, lower-middle, and upper-middle-income countries). The output gap impedes inflation in overall, lower-middle, and upper-middle-income countries, while it boosts inflation in low-income nations. And unemployment level increases the inflation rate in the overall and middle-income groups, while in low- and high-income countries, it decreases. According to the second model, foreign globalization and the foreign output gap boost overall low-income, middle-income, and upper-middle-income groups. While import reduces the inflation level globally, while in low-income, middle-income, and upper-middle-income groups, it increases inflation. Finally, the unemployment level boosts the global inflation level and as well as in low income, and it impedes inflation rate in upper-middle-income group. Despite this, there is considerable variation in countries' effect, perhaps due to differences in political institutions' quality, central bank independence, exchange rate systems, financial development, and legal traditions.

scholarly journals A Discussion on Whether Turkish Economy is in Middle Income Trap or Not: A Perspective on Framework of the Exchange Rates Appreciation

2015 ◽  
Author(s):  
Murat Nişancı ◽  
Mine Gerni ◽  
Adem Türkmen ◽  
Ömer Selçuk Emsen
Keyword(s):  
Exchange Rate ◽  
Income Group ◽  
Middle Income ◽  
Income Per Capita ◽  
Middle Income Countries ◽  
Turkish Economy ◽  
The World ◽  
Middle Income Group ◽  
Per Capita ◽  
Middle Income Trap

Since 2007 long staying in the middle income group or especially unable to state a higher category, has begun to be considered as middle-income trap (MIT). According to World Bank (WB) classification, in 1955, Turkey reached to lower-middle income countries category from low-income category and staying there about 50 years. In 2004 Turkey has been reached constantly to upper-middle income countries category. However, last three years’ low growth figures and reaching 20% of the US income per capita have created many discussions whether Turkey entered in MIT. Besides, in parallel the integration of Turkish Economy to the world economy and to be exposed financial flows because of the world expansionary policies may result to have excessive appreciation of the national currency and to seem overvalued than real level of GDP in dollars. In emerging artificial bloating in income per capita is a result of undervaluation on the exchange rate. Therefore, in this study; the correct exchange rate is calculated with using base year determined depending on current account deficit’s minimum valued year or years which is assumed correct value of the exchange rate. By using calculated exchange rate, examined new GDP per capita series shows that Turkish economy could not reach the threshold 10000-12000 dollars despite being included in upper-middle income group in the WB classification. Furthermore, according to other classifications which are investigating MIT, it is also reached that Turkey has been placed in MIT long time period due to exchange rate pressures in terms of Turkey reached upper middle income position.

Middle Income Group and Debt Fund

2011 ◽  
Vol 2 (3) ◽  
pp. 43-43
Author(s):  
Dr. Shakti Kumar ◽  
Keyword(s):  
Income Group ◽  
Middle Income ◽  
Middle Income Group
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