scholarly journals Foreign Direct Investment and Financial Development in Guinea: Causality Analysis

2022 ◽  
Vol 17 (3) ◽  
pp. 1
Author(s):  
Oumar Keita ◽  
Baorong Yu ◽  
Nthabeleng Lilian Moshoeshoe

This essay provides a better comprehension of the other disregarded impacts of FDI by examining first, the causality direction then the long- and short-term interaction among inward FDI and financial development in Guinea using 1990-2017 data set. The empirical assertions are grounded on the Granger causality wald test, Bounds test for co-integration, Error correction model (ECM) and the Auto regressive distributed lag (ARDL) framework. FDI per GDP net inflows and Credit to private sector are respectively adopted as FDI measure and financial advancement indicator. The following outcomes are established: first, FDI in the long term negatively influence financial advancement in Guinea at 5% magnitude. This inference indicates that 1 percent surge in FDI per GDP induces 0.389 decrease in credit to private sector. Second, FDI per GDP [L1] negatively and significantly interact with financial advancement in the short term. Suggesting that 1 percent increase in FDI in the short term engenders 0.215 decrease in credit to private sector. Third, the causality direction remains unidirectional irrespective to the number of lags. Finally, the long- and short-term coefficients tell us the same story regardless of the time effects. Overall, contrary to the common perceptions, we found strong evidence that foreign investment does not enhance financial development in Guinea. In terms of practical implications, it seems ineffective to use FDI as financial advancement instrument within the Guinean context.

2020 ◽  
Vol 66 (No. 12) ◽  
pp. 527-541
Author(s):  
Zaid Ashiq Khan ◽  
Mansoor Ahmed Koondhar ◽  
Noshaba Aziz ◽  
Uzair Ali ◽  
Liu Tianjun

Pakistan is an agriculture-based country, so the agricultural sector is known as the backbone of the national economy. Considering the national economy and the agricultural industry, it is necessary to focus on earnings through agricultural products export to improve the livelihood of local farmers. Therefore, the current study aimed to analyse the short-term and long-term factors affecting agricultural products export. The annual time series of 1976–2016 were collected from World Bank indicators, the Food and Agriculture Organization, and the Statistical Bureau of Pakistan. An autoregressive distributed lag, along with a vector error correction model, was employed. A cointegration test showed long-term associations between the selected variables. While the autoregressive distributed lag model confirmed the short-term correlation between area sown and crop production towards agricultural products export, there is no long-term relationship between the selected variables. In addition, the bidirectional correlation between employment in agriculture and agricultural products export was confirmed by the vector error correction model. Therefore, it is essential to increase agricultural production with the available natural resources to increase foreign earnings.


Author(s):  
Muhammad Yusuf Ibrahim ◽  
Indra Indra

The research is aim to attest and assess empirically the contribution of Islamic banking (IBs) on the inclusive growth in Indonesia. By taking a trial-stage method i.e. descriptive analysis to elaborate a statistical data, autoregressive distributed lag (ARDL) model to assess empirically the contribution in a long-term, and error correction model (ECM) to assess the contribution in a short-term empirically. The findings are, total deposits and total financing only contribute positively significant into GDP and gini ratio in a long-term, that similiar with the previous study. Then, a total financing contribute negatively to all indicators of inclusive growth in a long-term, but, its only significance on GDP and gini ratio. Means, it was contribute significantly to all indicators in a short-term.


2020 ◽  
Vol 6 (4) ◽  
pp. 1133-1138
Author(s):  
Muhammad Umair Ali ◽  
Saliha Gul Abbasi ◽  
Mazhar Abbas ◽  
Ghulam Dastgeer

The paper analyzed the long-term and short-term impact of interest rate, exchange rate and inflation on the private sector credit of Pakistan during the period from 1975 to 2018. To test the stationarity of data Augmented Dick Fuller (ADF) Test was applied. While the main model to explore the long-term and short-term dependence was based on Auto Regressive Distribution Lag (ARDL) Model. The results suggested no effect of exchange rate on private sector credit, while inflation has significant as well as positive impact on Private Sector Credit (PSC) in long as well as short run. Lastly, the most important dependence i.e. interest effect on PSC; depicted negative impact in both short and long term.


Author(s):  
Syarifah Labibah ◽  
Abd. Jamal ◽  
Taufiq C. Dawood

There are some factors predicted tohave an effect on the countries’ economic devlopment. This study aimed to analyze the long-term and short-term effects of In-flation, Exchange Rate, and Foreign Economic Growth (the destination of the United States, China, and Japan) on the Indonesian Export. The Auto-Regressive Distributed Lag (ARDL) Model is used in this analysis from 1968 through 2017. The results of the analysis show that in the long-term, the inflation and the economic growth in China as well in Japan has a positive sign and significant effect on Indonesian exports. In addition, in the short-term, the US exchange rate and economic growth have a positive significant effect on Indonesian exports.


2020 ◽  
Vol 12 (17) ◽  
pp. 6959 ◽  
Author(s):  
Mingyuan Guo ◽  
Yanfang Hu

This paper studies the impact of financial development on carbon emissions in China from 1997 to 2016. First, this paper uses the entropy method to construct a synthetical index to measure the financial development. Meanwhile, a two-dimensional panel framework is introduced to group provinces in the panel analysis. The estimation results of the time series autoregressive distributed lag model show that for China as a whole, there is a weak carbon emissions reduction effect of financial development, whether it is a long-term effect or a short-term effect. The estimation results of the panel autoregressive distributed lag model also support that an increase in financial development suppresses carbon emissions. Although financial development inhibits carbon emissions both in the short run and in the long run, the absolute value of the long-term coefficient of financial development is significantly greater than that of the short-term coefficient.


2015 ◽  
Vol 7 (1) ◽  
pp. 59-72
Author(s):  
Yoghi Citra Pratama

The  purpose  of  this  research  is  to  analyze  the macroeconomics  variables  that  affect  to  the  performance  of  Islamic  banks  in Indonesia. Methods used in this research is the Vector Auto regressive (VAR) / Vector Error correction model (VECM) to see the effect of the shock and the long-term effect on the performance of Islamic Banking. The results show that based on the analysis of IRF, the performance of Islamic banking having short-term shocks to fluctuations in macroeconomics variables but stable in the long term, and based on the variance decomposition, shocks of macro variables only gives little effect on the performance of Islamic banking.DOI:10.15408/aiq.v7i1.1359


2017 ◽  
Vol 9 (1) ◽  
pp. 45 ◽  
Author(s):  
Nguyen Quang My ◽  
Mustafa Sayim ◽  
Hamid Rahman

This study examines if there is an equilibrium relationship between gross domestic product (GDP), exchange rate fluctuation and trade balance in long-term and short-term in Vietnam. The results show that the short-term and long-term exchange rate fluctuations impact the trade balance in Vietnam; both ARDL (Autoregressive Distributed Lag) and ECM (Error Correction Model) methodologies implied that exchange rate has a statistically negatively impact on the trade balance. Particularly, Autoregressive distributed lag (ARDL) utilized to test the long -term impact, shows the trade balance deficit becomes worse when the REER (real effective exchange rate) increases. ECM (Error Correction Model) equation based on the long-term cointegration equation and impulse response, reveals that the domestic currency devaluation could not improve the trade balance, indicating that the J-curve effect does not hold on the dong, the currency of Vietnam.


2020 ◽  
Vol 8 (2) ◽  
pp. 68
Author(s):  
Bilgehan Tekin

The purpose of this study to examine the relationship between financial development and human development in the health and welfare dimensions of developing countries. This study aims to determine whether the financial developments of the countries have an effect on the basic human development of the individuals and whether human development indicators have an impact on financial development. In this study, the relationship between financial development and human development has been tried to be revealed by using data obtained from developing countries. Financial development levels of the countries were measured with the developed financial development index. The index is calculated by using M3 / GDP, private sector loans / GDP and loans to banks from private sector / GDP ratios. The human development index is calculated by considering various health indicators and GNP per capita. The data includes annual data for the period 1970-2016. Pedroni and Kao cointegration analysis and Dumitrescu & Hurlin panel causality analysis were performed in the study. According to the results of the study, the cointegration relationship was determined between the two variables. There is also a two-way causality between the variables.


2016 ◽  
Vol 10 (1) ◽  
pp. 45-62
Author(s):  
Muhammad Fawaiq

Penelitian ini bertujuan untuk menganalisis hubungan antara Moda 2 dan Moda 3 dalam perdagangan internasional di sektor jasa pariwisata. Metode penelitian yang digunakan dalam penelitian ini adalah Panel Vector Error Correction Model (VECM) Granger. Data yang digunakan adalah data kedatangan wisatawan mancanegara dan Foreign Direct Investment (FDI) jasa hotel dan restoran tahun 1997-2014 di Bali, Jakarta, Kepulauan Riau dan Sumatera Utara. Daerah-daerah ini berkontribusi sebesar 81,26% dari total kedatangan wisatawan mancanegara di Indonesia dan 68% terhadap total FDI di jasa hotel dan restoran Indonesia. Hasil penelitian menunjukkan bahwa tidak terdapat hubungan kausalitas jangka pendek antara kedua variabel tetapi terdapat hubungan jangka panjang satu arah yaitu variabel Moda 3 dipengaruhi oleh variabel Moda 2. Hasil pengujian pada gabungan antara jangka panjang dan jangka pendek menujukkan bahwa variabel Moda 3 secara kuat dipengaruhi oleh variabel Moda 2. Dengan demikian diketahui bahwa semakin banyak jumlah wisatawan mancanegara yang datang ke Indonesia maka akan mendorong meningkatnya FDI di jasa hotel dan restoran, tetapi meningkatnya FDI di jasa tersebut tidak signifikan berpengaruh terhadap masuknya jumlah wisatawan mancanegara. This paper examines the relationship between Mode 2 and Mode 3 of international trade in tourism sector. The method used is the Panel Vector Error Correction Model (VECM) Granger. The data used in this study were the number of foreign tourist arrivals and the Foreign Direct Investment (FDI) in some hotels and restaurants during 1997-2014 in Bali, Jakarta, Riau Islands and Nort Sumatera.These regions contributed for 81.26% out of the total tourist arrivals in Indonesia and 68% of the total FDI in the services of hotels and restaurants Indonesia. The results using VECM Granger demonstrated that there was no short-term causality relationship between these two variables but they had a long-term causality relationship that the Moda 3 was affected by the variable mode 2. Test results on a combination of long-term and short-term showed that the variable mode 3 was strongly influenced by variable mode 2. Thus, it is known that the more foreign tourists coming to Indonesia, the more FDI we gained from the service of hotels and restaurants, but this increase does not significantly affect the number of foreign tourists.


2013 ◽  
Vol 3 (2) ◽  
Author(s):  
N. Jyothi ◽  
Dr. T. Satyanarayana Chary

Financial performance of individual organizations differ very significantly, however, the performance is distinguishable between public sector companies and private sector companies as their nature and size of investment and business environment is different . The ECIL is a very vast growing company which requires additional funds on a regular basis, whether internal or external. Particularly, the company needs both long term and short-term finances in view of its present position and enormous scope for improvement in the services provided. The present paper is a modest attempt to discuss the financial performance analysis of ECIL, Hyderabad in terms operating profits, capital employed ratios and turnover in a comprehensive manner over a period of 10 years.


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