scholarly journals Fixed Investment and Economic Growth: ARDL and Causality Exploration for SADC Countries

2021 ◽  
Vol 11 (4) ◽  
pp. 18
Author(s):  
Reginald Masimba Mbona ◽  
Chilombo Stephania Mumba ◽  
Tinashe Mangudhla
Keyword(s):  
Economic Growth ◽  
Purchasing Power Parity ◽  
Power Parity ◽  
Fixed Investment ◽  
Economic Activities ◽  
Long Run ◽  
Short Run ◽  
Using Data ◽  
The Cost ◽  
Marginal Returns

In assessing the short run and the long-run effects of fixed investment and economic growth among Southern Africa countries, we evaluated the economic progress of the SADC (Southern African Development Committee) region. Our objective is to determine how variables (GDP, purchasing power parity, inflation, electricity, balance-of-payments, and unemployment) can be affected by the fixed investment. In determining how fixed investment affects economic activities and policies among the states, the ADRL estimation approach is applied. Using data from 13 countries in the SADC region from the period 1992-2018, we enumerate the variables’ marginal returns against the fixed investment component. The results of diagnostic and other tests show that all statistical procedures are robust. The result proves that the benefits of fixed investment are yielded over a long period rather than short periods. As a result, the cost in the short term cannot be compared to the benefits that will be enjoyed later by an economy as it becomes productive. Furthermore, the lack of consistent fixed investment among countries will eventually lead to insufficient cash flow, which will negatively affect the currency. These results would seem to suggest that the introduction of policies that promote investment will massively contribute to increased productivity and positive economic growth in the region.

Electricity consumption and economic growth in ASEAN

2017 ◽  
Vol 5 (2) ◽  
pp. 16
Author(s):  
Ahmad Ghazali Ismail ◽  
Arlinah Abd Rashid ◽  
Azlina Hanif
Keyword(s):  
Economic Growth ◽  
Energy Use ◽  
Electricity Consumption ◽  
Panel Estimation ◽  
Real Gdp ◽  
Long Run ◽  
Bidirectional Relationship ◽  
Short Run ◽  
Using Data ◽  
The Relationship

The relationship and causality direction between electricity consumption and economic growth is an important issue in the fields of energy economics and policies towards energy use. Extensive literatures has discussed the issue, but the array of findings provides anything but consensus on either the existence of relations or direction of causality between the variables. This study extends research in this area by studying the long-run and causal relations between economic growth, electricity consumption, labour and capital based on the neo-classical one sector aggregate production technology mode using data of electricity consumption and real GDP for ASEAN from the year 1983 to 2012. The analysis is conducted using advanced panel estimation approaches and found no causality in the short run while in the long-run, the results indicate that there are bidirectional relationship among variables. This study provides supplementary evidences of relationship between electricity consumption and economic growth in ASEAN.

scholarly journals THE CO - INTEGRATION ANALYSIS OF EFFECT OF VALUE ADDED TAX AND EXCISE DUTIES ON ECONOMIC GROWTH IN NIGERIA

2021 ◽  
Vol 1 (1) ◽  
pp. 44-53
Author(s):  
ADEGBITE, TAJUDEEN ADEJARE
Keyword(s):  
Economic Growth ◽  
Negative Impact ◽  
Value Added ◽  
Value Added Tax ◽  
Excise Duty ◽  
Long Run ◽  
Short Run ◽  
Using Data ◽  
Excise Duties ◽  
Integration Analysis

This study examined the co-integration analysis of effect of value added tax and excise duties on economic growth in Nigeria. It also looked at the direction of causality among value added tax excise duty, interest rate, exchange rate and economic growth employing the method of Johansen co-integration and the Granger causality tests using data spanning the period 1994- 2014. Results showed that VAT has positive significant impact on GDP in the short run but has negative impact on GDP in the long run with (  = 1.296417; t=7.41; P>|t|= 0.000) and ( =- 13.38159; z=-3.60 , P>|z|= 0.000) respectively. Also, VAT does not granger cause GDP. Excise duty impacted GDP negatively in the short run but positively in the long run with (=-1.111069; t=-5.16, , P>|t|= 0.000) and ( =37.54469; z = 4.07; P>|z|= 0.000) respectively. It is recommended that, once the value added tax impacted economic growth positively in the shortrun but negative in the long run, government should increase the rate of value added tax in Nigeria, this will in turn boosting the revenue generation in Nigeria. Also, government should increase excise duty on tobacco and alcoholic so as to have positive significant impact on economic growth in the short run.

scholarly journals Islamic Financial Development and Economic Growth of Emerging Economy of Pakistan; a Panel Data Approach

2020 ◽  
Vol 6 (1) ◽  
pp. 197-208
Author(s):  
Muhammad Yasir Saeed ◽  
Kashif Hamid ◽  
Muhammad Ahmad Ur Rehman ◽  
Muhammad Nazam
Keyword(s):  
Economic Growth ◽  
Islamic Banks ◽  
Economic Activities ◽  
Dynamic Interactions ◽  
Policy Framing ◽  
Panel Ardl ◽  
Long Run ◽  
Short Run ◽  
Individual Capacity ◽  
Islamic Economic

The purpose of this study is to investigate the dynamic interactions between five pure Islamic banks of Pakistan and economic growth by using Panel ARDL method over the period of 2006-2016. The study elaborates strong confirmation and advocates the significant positive long-run relationship with economic growth. However, in short-run, each bank has individual significant positive relationship with economic growth in its individual capacity. The findings of this study are encouraging and signify a considerable contribution to recognize how pure Islamic banks activities translated into economic performance of the country. Although prudential regulations of State Bank of Pakistan are quite sound and their legislative structure and policy framing is also equally good but they are required to enhance the number of pure Islamic banks in the country for offering multiple options to clientele in order to promote Islamic economic activities in the country  to make Pakistan more prosperous.

scholarly journals Environmental Kuznets Curve for Sustainable Development

2019 ◽  
Vol 8 (12S) ◽  
pp. 813-818
Keyword(s):  
Economic Growth ◽  
Purchasing Power Parity ◽  
Environmental Kuznets Curve ◽  
Theoretical Framework ◽  
Kuznets Curve ◽  
Power Parity ◽  
China And India ◽  
Long Run ◽  
Energy Needs ◽  
Installed Capacity

Economies today are relying on coal and other finite sources for their energy needs which has not only resulted in exhaustion of finite resources but also has adversely affected the environment as burning of coal alone is responsible for emission of Green House Gases . As the economy grows the consumption of power also rises and in order to keep pace with the growing demand for power, economies are forced to increase the installed capacity. But in economies like US, China and India dependence on coal has been in rise for last few decades. Simon Kuznet rightly brought this to our notice and established the relationship between carbon emission and GDP which would be positively related initially but growth in GDP would enable the economies to find out some alternatives and reduce the emissions n long run. This paper critically analyses the existence of hypothesized relationship of Environmental Kuznets Curve (EKC) between Gross Domestic Product (GDP) and CO2 emissions of U.S., India and China. In trying to prove the theoretical framework that economic growth (GDP) in terms of purchasing power parity and environmental deterioration are strongly related, the paper used the data of developed and developing countries mentioned above. The main aim of the paper is to check the applicability of Environmental Kuznets Curve (EKC) on the economic growth of U.S., China and India. The researcher used regression for time series analysis in analyzing the data from 1999-2018. The paper is divided into three sections with the first section covering the introduction; the second section is theoretical framework. Data analysis and presentation of findings formed the third section. The researcher finally concluded the paper by giving some suggestions in lieu of the findings.

scholarly journals Effects of Agricultural, Manufacturing, and Mineral Exports on Angola’s Economic Growth

Energies ◽  
2020 ◽  
Vol 13 (6) ◽  
pp. 1494 ◽  
Author(s):  
Titus Isaiah Zayone ◽  
Shida Rastegari Henneberry ◽  
Riza Radmehr
Keyword(s):  
Economic Growth ◽  
Positive Impact ◽  
Dutch Disease ◽  
Ardl Model ◽  
Agricultural Exports ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
Long Run ◽  
Short Run ◽  
Using Data

This study investigates the effects of Angola’s agricultural, manufacturing, and mineral exports on the country’s economic growth using data from 1980 to 2017. An Autoregressive Distributed Lag (ARDL) model is employed to estimate the effect of sectoral exports on economic growth. The estimation results show that while exports from all three sectors (manufacturing, mineral, and non-mineral) have driven Angola’s economic growth in the long-run; only non-manufacturing (agricultural and mineral) exports have led its growth in the short-run. Moreover, growth in non-export GDP was driven by mineral exports in the long-run and agricultural exports in the short-run. Considering the statistically significant and positive impact of mineral exports on the Angolan GDP as well as on its non-export GDP, this study points to a lack of evidence supporting the Dutch disease phenomenon in Angola.

scholarly journals Official Development Aid: Plaster in A Wound? Evidence Using Data From Ethiopia

2021 ◽  
Author(s):  
Cherkos Meaza
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Development Aid ◽  
Aid Effectiveness ◽  
Political Leader ◽  
Real Gdp ◽  
Long Run ◽  
Short Run ◽  
Using Data ◽  
Official Development Aid

Abstract The flow of aid to developing countries has increased massively and they receive billions of dollars per year in the form of aid from bilateral and multilateral donors. However, the economic growth achieved by many developing countries in general has not been satisfactory. Poverty is still there and resulted in a custom of aid dependence and foster the opportunity for the corrupted political leader. The conclusion on aid effectiveness is doubtful among economists, found to be inconclusive. This paper intends to see how ethiopian economy is reacting to the flow of foreign aid coming from rest of the world viz-a-viz the current most prestigous and influential arguments against and pro-effectiveness of aid. A time series on important parameters extending from 1981 to the most current 2017 is used and an econometrics techniques ECM is employed to examine the short run dynamics and long run relationship among the variables. The result of the short run dynamics showed that aid has a negative and statistically significant impact on economic growth. However, the impacts turns to be positive in the long run. economic growth measured by the real GDP adjusts to its long run equilibrium with an average speed of about 25.7 percent annually and it will roughly take it about 4 years to restore back to equilibrium, ceteris paribus.

scholarly journals Government Spending and Economic Growth in Ghana: Evidence from Granger Causality Analysis

2017 ◽  
Vol 3 (2) ◽  
pp. 50-58 ◽  
Author(s):  
Lucy Anning ◽  
Wang Haisu ◽  
Joshua Sunday Riti
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Government Spending ◽  
Causality Analysis ◽  
Economic Activities ◽  
Bounds Testing ◽  
Causality Test ◽  
Distributed Lag ◽  
Long Run ◽  
Short Run

In spite of the diverse major issues affecting the economy of Ghana over the years, the economy continues to experience a downward spiral in its economic growth. Taking into account three opining views regarding government spending and economic growth, this study sets to investigate the causal nexus fractious and economic growth in Ghana. We apply the autoregressive distributed lag (ARDL) bounds testing approach to co-integration and the vector error correction model (VECM)-Granger causality test to evaluate both long- and short-run parameters including the direction of causation with data spanning from 1980 and 2015.The empirical results show evidence of co-integration for the existence of a long-run relationship between the dependent and independent variables. The Granger causality tests, in addition, indicated causal independence between government spending and economic growth within the time framework of the study in the economy of Ghana. Government spending has a cause effect on economic growth in Ghana. However, government spending channeled into a more fractious use with the building of resilience and infrastructural development that are self-liquidating if encouraged will enhance economic activities in the short run and also propel growth in the long run in the Ghana.

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