International Liquidity Channel and Performance of Commercial Banks in Nigeria

This study examined the effect of international liquidity channels on the profitability of quoted commercial banks in Nigeria. The objective was to examine the direction which international liquidity channel affects commercial banks profitability. Return on equity was used as dependent variable while Monetary policy channels proxy by percentage of net foreign assets, financial market channel proxy by percentage of net foreign portfolio investment, international trade channel proxy by percentage of Nigeria terms of trade, capital mobility channel proxy by net foreign direct investment and currency channel proxy by variation of Nigeria naira to US dollar. Panel data of return on equity were sourced from financial reports of the commercial banks while international liquidity variables were sourced from Central banks of Nigeria statistical bulletin. Ordinary least square methods were used as data analysis methods. The study found that 50.3 percent of the variation in return on equity of the commercial banks is explained by the variables in the equation. Monetary policy channel, international trade channel and currency have negative effect on return on equity while financial market channel and capital mobility channel has positive and no significant effect on return on equity of the commercial banks. The study recommends that Central Bank of Nigeria should adopt an appropriate macro prudential framework to enable Nigeria banks become internationally active in terms of liquidity and solvency. The depreciating naira exchange rate should be integrated to the monetary and the macroeconomic policies to avert its negative effect on the economy and the banking industry. The regulatory authorities and the bank management should formulate policies to manage international monetary shocks, the international financial environment and global financial crises to enhance Nigerian banking system soundness.

Wage- and profit-led growth regimes: a panel-data approach

The extensive empirical effort made in the growth and distribution literature to estimate whether economic growth is wage- or profit-led has not sufficiently considered the theoretical foundation of the Neo-Kaleckian model. This paper attempts to respect key tenets of the investment function by estimating a panel-data model in which country-specific structural characteristics and possible endogenous relationships in income distribution and economic growth are explicitly considered. The identification strategy is based on several estimates of the capital stock and the rate of capacity utilization for 61 countries over the period between 1995 and 2014. The main results suggest that the growth regime was wage-led in developed countries, while most developing countries exhibited a profit-led growth regime. Interestingly, however, while the profit-led regime occurs through the international trade channel in Latin American countries, in other developing countries, the causality channel is mainly related to the domestic investment function.

Modeling Transit Flow Through Port Gates and Connecting Channel in Baltic Sea—Liepaja Port—Liepaja Lake System

This study investigates a water transport features by extending Copernicus Marine Environment Service (CMEMS) to the Liepaja coast-port-channel-lake system with a two-way nested model. The Liepaja lake and Liepaja port are connected by Trade channel. The Liepaja port has three gates—the openings in wave breakers connecting the port aquatory with the Baltic sea. Each of gates has a corresponding dredged channel for securing the navigation. A hydrodynamic model is set up to study the flow and water level in this system. The area of the port gates, port and Trade channel are resolved by 33 m grid. The model results are verified against currents and sea level observations inside/outside port, Trade channel and Liepaja lake. Results and observations show that strong currents occur in the Trade channel in case of rapid sea level change in Baltic sea despite the Trade channel is rather shallow at the connection with Liepaja lake. The northern part of the Liepaja lake gets filled with brackish water during storm surge events. The channel has notable alternating current also during a relatively calm weather due to the port seiches. Long and narrow shape of the channel implies the Helmholtz type oscillations between the lake and the port with a period in approximately semidiurnal range. Hydrodynamic simulations describe well these oscillations but the phase of hourly scale oscillations in the port may differ in case of weak external forcing. Water exchange is significantly increased by the transit (gate to gate) sea currents. This transit flow usually occurs between South or Central gate and the North gate carrying sea water into the port. Northward flow of the surface layer is more characteristic in the port aquatory due the prevailing south-western winds. There are intense morphological processes at the coastline and underwater slope near the Liepaja port due to a sandy western coastline of Latvia, long fetch of the waves and strong currents at the port gates. Liepaja port is one of the Latvian ports in HywasPort operational service of hydrodynamics, waves and siltation.

Effects of the European Monetary Union on High-Technology Exports

Our study estimates the effects of the European Monetary Union (EMU) on high-technology (HT) export and assesses the potential knowledge spillovers of such trade. Irrespective of the importance of the HT trade channel, none of the previous studies in the literature focus on the effects of a common currency on HT trade. Increasing trade in the HT sector may lead to more efficient use of resources and help countries to move towards a knowledge-based economy. Moreover, it may lead to higher overall growth. After considering multilateral resistances, pair fixed effects and bias correction in the preferred (three-way bias-corrected) model, EMU membership becomes negative and statistically non-significant for HT exports. Furthermore, our findings indicate that the effect of the EMU on HT exports is country-specific, which lends support to the notion of non-homogenous knowledge transfer and country-related knowledge-based economic development within the EMU.

Japan’s Foreign Assets and Liabilities

The composition of Japan’s current account balance has changed over time, with an increasing income balance primarily reflecting a growing net foreign asset position and higher corporate saving. A comparison of Japan’s income balance with peer countries highlights: (i) relatively high yields on FDI assets, and (ii) very low FDI liabilities in Japan. Panel estimation is used to derive separate exchange rate elasticities for income credit and debit, with novel accounting that disentangles the mechanical from the economic response to exchange rate fluctuations. Despite the changing composition of Japan’s current account balance, its response to exchange rate movements still operates mostly through the traditional trade channel, with a small but reinforcing contribution from the income balance.

Drivers of elephant tourism in Thailand.

This chapter details the development of elephant tourism in Thailand. Following a logging ban enacted by the government in 1989, in response to devastating floods and loss of life brought about by unsustainable logging practices, elephants used in logging and their mahouts suddenly found themselves unemployed. From positions of high esteem, some 2000 elephants and their mahouts were forced to resort to begging on the streets of Thailand, in order to survive. Seeing this as an opportunity, Thai entrepreneurs began to offer visits to old logging camps that had been turned into attractions for tourists, beginning the involvement of elephants in the tourism sector. The welfare of the elephants at this stage was at best a secondary concern for many of the camp owners and operators. The authors note however that this is now changing. Interestingly, for the elephants in Thailand, the improvements in their welfare resulted from the actions of travel trade associations such as ABTA (the Association of British Travel Agents), travel trade channel members, and specialist animal welfare and ethnic community NGOs.

Internet, Participation in International Trade and Tax Revenue Instability

This paper investigates the effect of the Internet on tax revenue instability, notably through the international trade channel. It has used a sample of 142 countries over the period 1995-2017, and relied primarily on the two-step system Generalized Methods of Moments (GMM) estimators (but also incidentally on the Error Component Two-Stage Least Squares estimator). Tax revenue instability is primarily measured by the instability of non-resource tax revenue, but also by the instability of total tax revenue (for robustness check). The findings indicate that the Internet exerts a negative effect on tax revenue instability. Interestingly, this effect genuinely translates through the international trade channel, regardless of the measure of tax revenue instability considered. Countries enjoy a higher negative effect of the Internet on tax revenue instability as they enjoy a greater participation in international trade. These findings, therefore, add to the potential benefits of the Internet adoption (e.g., strengthening countries' participation in international trade, enhance their tax revenue performance and promote tax reform, including in developing countries) by showing that it could also help to stabilize tax revenue, particularly through the degree of countries' participation in international trade.

The drivers of Italian exports and product market entry: 1862–1913

Between its unification and WWI, Italy’s changing export composition echoed its economic transformation. In this paper, I decompose Italian export growth in its margins and then analyze the determinants of Italian exports and product market entry (and exit). To do so, I use two different databases (aggregate and product-level bilateral trade data) and methodologies (gravity and logit models). Besides confirming some well-known empirical and historical facts for the Italian case (gravity variables hold; trade follows a Heckscher–Olhin pattern), the regression results offer a new perspective on two distinctive features of its history: trade policy and emigration. These two factors are positively associated with Italian exports and product market entry. These findings also have additional implications for the role of emigration on the course of the Italian economy: accounting for the trade channel, its overall effect may be larger than previously thought.

Estimation of the Impact of the New International Land and Sea Trade Channel on the Development of the Trade Potential of 8 Domestic Provinces and Cities

The new international land and sea trade channel is an important part of China’s “The Belt and Road Initiative” going south, with Chongqing as the operating center, and 7 provinces and cities such as Guangxi, Guizhou, and Gansu as key nodes. Gravity Model of Trade is adopted to analyze the issue of trade creation effect and trade transfer effect in the flow of China-ASEAN trade in detail. According to the theoretical trade value calculated by the export gravity model, the actual trade value was divided by the theoretical value to calculate the trade potential coefficient, which has been applied to measure the trade potential of export of 8 provinces and cities to the ten ASEAN countries. It is concluded that trading partners are in different types ranging from “potential remodeling”, “potential expansion” to “great potential”, and heterogeneity tests are performed to prove the self-consistency of the effect measurement. Further, it is proposed that to further develop trade relations, we must develop positive factors to promote export trade, stimulate trade needs of partner countries, and actively develop trade market countermeasures.