Relationship between Macroeconomic Policy and Long-Run Economic Growth of Nepal

Background: The paper is an attempt to find the long-run relationship between macroeconomic variables and economic growth in Nepal. The variables in the study are run across the Cobb-Douglas production model. Objective: This paper examines the relationship between Gross Fixed Capital Formation, Population, Trade openness, Money Supply and GDP growth economic growth in Nepal. Method: The ARDL bound test and Error Correction model incorporated in the study to examine the long-run relationship among macroeconomic variables. Conclusion: Based on the Bound Test of F-statistics the Cointegration Result exists among the variable and ARDL (1,1,1,1,1) relation is estimated. Implications: Since the study has found the existence of a cointegration relationship on the variables of the study and the long-term relationship among economic growth is significant with GFCF. The policy should be targeted at investment growth in Nepal.

Potential GDP and its factors assessment

The object of the study is the reserves of economic growth in the country on the example of Ukraine. One of the problems of such studies is the calculation of potential GDP, which is not observed, but is calculated on the basis of various methods. Also problematic is the choice of method/methods of calculating potential GDP and potential values of its factors. Any estimate of the potential value of a variable is based on one or more statistical relationships and therefore contains an element of uncertainty. In order to reduce uncertainty, 2 methods were used to determine the potential values of the components of GDP – the growth rate of employment, fixed capital and TFP (total factor productivity). The study used the methods of one-dimensional statistical filters Hodrick-Prescott and Baxter-King to estimate the potential values of GDP and the model of the production function to calculate potential GDP based on the potential values of its factors. The main reasons for the slowdown in Ukraine's GDP have been identified, the main of which is low capital productivity due to budget constraints. The second place in this ranking was taken by labor productivity, the last third – by TFP. Weak productivity and investment growth reinforced each other. Capital has the highest growth potential in Ukraine. Therefore, measures to stimulate capital investment, including in research and innovation and human capital, are important. Other factors that affect GDP through labor productivity and TFP are population aging, emigration, and tight lending conditions. To neutralize these factors, it is necessary to create new jobs, facilitate the conditions for obtaining loans by enterprises, stimulate advanced training and lifelong learning. The proposed approach to the separate calculation of potential values of GDP factors and their analysis find reserves for GDP growth. This provides the advantages of this method over other approaches.

Multinational Firm Growth and Sustainability Responses to Dynamics of Business Regulations in Host Market

Dynamics in business regulations measured by ease of doing business is a new approach that indicates countries’ business climate reforms toward suitability for investment growth. The present study took three variables from the ease of doing business data and evaluated them toward predictive power of FDI flow to 19 Sub-Saharan African countries by using fixed-effect model. Based on the analysis, the official time, procedures, costs, and minimum capitals in starting a business stage, enterprise registrations and official permissions of the firm establishment had a material effect on investment growth. Even though, on one side trade openness and the growing market size was seen as an opportunity, the deep-rooted corruption and landlocked was the trap for the smooth growth of firms in the region.

Exploration of PPP Investment and Financing Model for Infrastructure: A Case Study of the Beijing-Tianjin-Hebei Region

With the overall weakening of the macroeconomic situation, the investment growth in Beijing-Tianjin-Hebei continued to slow down. This article focuses on the reform and innovation of investment and financing models in the vertical and horizontal collaborative construction of Beijing-Tianjin-Hebei infrastructure. Under the framework of the PPP model, this article discusses how to design a market-oriented platform of infrastructure investment and financing model, introduce and use private capital, build remote capital access and exit mechanism, measure the government’s financial capacity and financial risks in the PPP model, set up PPP institutions, and improve relevant laws and regulations to make the infrastructure construction and operation more efficient, thus promoting the coordinated development of infrastructure construction in the Beijing-Tianjin-Hebei region.

Short- and long-term effects of responsible investment growth on equity returns

PurposeThe growth of socially responsible assets has been exponential over the last decade, they now account for almost a third of professional investments. As the growth persists, faith and conviction investors reshape the equity markets. To fully comprehend the impact of socially conscious participants on security returns, this paper attempts to provide insights on how responsible investment growth has impacted the returns of sustainable stocks. The examination is split by investment horizon to account for short and long effects.Design/methodology/approachUsing an exclusive dataset of non-financial ratings, provided by MSCI ESG research, the authors examine the cross-sectional returns of US and European sustainability-leading and lagging corporations between 2007 and 2019. Panel models robust to country, firm-year and industry effects were then employed to examine the impact of responsible investment growth on future stock returns.FindingsThe authors find evidence that the impact of responsible investment growth is dual contingent upon the timeframe considered. In the short run, sustainability-leading and lagging firms display similar stock returns. However, the spread in returns is negative over long horizons and increasing over time.Originality/valueThe examination performed in this study highlights the significant effect of responsible investment growth on future stock returns. Overall, the authors’ findings are consistent with the price pressure hypothesis in the short run and the cost of capital alteration over longer horizons.

Financialization, premature deindustrialization, and instability in Latin America

The paper analyses the relation between premature deindustrialization in Latin America and what is termed premature financialization. Premature financialization is defined as a turn to finance, organized as an industrial concern, which is a vehicle for accumulation before the process of industrialization has reached maturity. This contrasts with developed countries where financialization occurs after an advanced stage of economic and social development has been reached, and where the growth of the financial sector, beyond a certain threshold, can be detrimental to economic activity. The paper examines the consequences of premature financialization for investment, growth, and financial stability.

Kajian Hukum Perbandingan Kemudahan Investasi Asing di Singapura dan di Kota Batam, Indonesia Beserta Legal Standing OSS Dalam Penerapannya

Investment is one of the first steps in moving the wheels of a country's economy. In the city of Batam itself is strongly identified with the investment climate. With its strategic location, Batam City is located adjacent to its neighboring countries, namely Singapore and Malaysia. The OSS (Online Single Submission) system emerged as one of the steps aimed at increasing the competitiveness of the global region and encouraging investment growth. However, in the OSS system there are still many obstacles both in terms of regulations and implementers of regulations that are considered less than optimal in applying electronically integrated business licenses. This is also worsen by the dualism of authority in managing the region. Looking to neighboring countries, Singapore is a favorite destination for global companies wishing to expand their business in Asia. The ease of obtaining a business license has become the main focus for this Lion Country. This study uses a normative legal research method with a comparative law approach and a statutory regulation approach. The purpose of writing this article is to study the ease of foreign investment in Singapore compared to Batam City and the legal standing of OSS in its application. Based on the research conducted, the ease of investment is examined from various factors, namely in the areas of legal certainty, taxation, employment, and licensing of the Indonesian OSS system including Batam City which still does not fully support a conducive investment climate in doing business compared to Singapore.

Macroeconomic, Political, And Institutional Determinants of Private Investment In Ethiopia: A Dynamic Analysis

This article investigates the macroeconomic, political, and institutional determinants of private investment in Ethiopia based on a time series data from 1985 to 2018. We apply ARDL approach to Co-integration to investigate the long-run and short run outcomes. The result reveals that real GDP has positive significant effect on private investment growth in both long run and short run while public investment has a crowding-out effect in short run but crowding-in effect in the long run. Real interest rate has a significant negative effect on private investment growth in long run unlike its short run effect. Hence, we recommend more effort has to be excreted to increase the market-size and real income of the people to promote private investment. Secondly, public investment in infrastructures is crucial to attract private investors though public investment in sectors that compete directly with the private sector retard private investment growth. Thirdly, given the negative significant effect of real effective exchange rate on private investment, devaluation is not a long-lasting solution to promote private investment unless the marshal-learner condition is satisfied. Fourthly, the government has to ensure consistent management strategies to minimize corruption, violent uprisings, and bureaucratic inefficiencies to build up confidence of private investors.

Financial depth in the context of the relationship with economic growth

The generalization of quantitative and qualitative scientific approaches to the essence of financial depth enables to define it as a resulting characteristic that demonstrates the saturation of the economy with financial resources, that allows assessing the ability of the financial system to effectively mobilize and redistribute financial resources to achieve sustainable economic development. The retrospective analysis of empirical hypotheses linking the financial depth of the economy and economic growth suggests that while some scholars focus on the importance of financial depth in economic development, others emphasize the effects of financial crises caused by rapid financial deepening, in particular credit expansion. The focus of contemporary research is on the nonlinearity of the relationship between financial depth and long-term economic growth and on defining the limit of financial development, exceeding which inhibits economic growth or negatively impacts it. Among the positives of financial deepening is the expansion of access to financial resources (increase in the volume and diversification of financial instruments), reduction of income inequality and smoothing of consumption, diversification of production risks. Among the risks of financial deepening is the deterioration of the current account due to excessive lending, unproductive investment, growth in employment in non-productive sectors, limitation of the use of fiscal policy as an instrument of countercyclical policy. It is noted that formation of the financial depth of the economy depends on the characteristics of financial resources and as well in structural, macroeconomic, political and institutional factors of economic development. While the world tends to increase the ratio of financial assets, broad money, domestic credit provided by financial institutions, the capitalization of listed companies to GDP, in Ukraine since 2014 there has been a significant decrease in these indicators, which is not typical in comparison with countries with the same level of income and demonstrates the low level of financial depth of the domestic economy.

Faktor-Faktor yang Mempengaruhi Financial Distress: Pendekatan Model Springate dan Grover (Studi Empiris pada Badan Usaha Milik Negara Periode 2015-2019)

Financial distress is a condition in the stage of financial decline that occurs before the occurrence of bankruptcy or liquidation. This study aims to examine the factors that affect financial distress in State-Owned Enterprises (BUMN). The independent variables tested were managerial compensation, working capital, investment growth, operating cash flow, and leverage. Financial distress in this study was measured by the springate method and the grover method. This study selects the sample by purposive sampling method. With the final result as many as 58 samples for 6 years of observation. Research data for the period 2014-2019 was analyzed using multiple linear regression analysis. The results showed that the working capital and leverage variables had an influence on financial distress. Managerial compensation, investment growth, and operating cash flow have no effect on financial distress.