Exchange Rate and Trade in Services Nexus in Nigeria: A Non-Linear ARDL Approach

A nonlinear ARDL model is employed to investigate the asymmetric drivers of non-oil trade in services between Nigeria and Netherlands. A significant number of past studies have concentrated their attention on the elasticity of trade in services to real exchange rates and income as well as on non-oil export, total export trade or import, yet none have delve into asymmetric relationship. This study aims to fills this void. Our result shows that the effects of exchange rate variations have both positive and negative displays with more negative asymmetry. This provides further insights in the nature of service asymmetries. (JEL Codes: C22, D43, E31, L71, Q41) Keywords: asymmetric cointegration, exchange rate adjustment, disaggregated, services

Exchange Rate Dynamics, Energy Consumption, and Sustainable Environment in Pakistan: New Evidence From Nonlinear ARDL Cointegration

Pakistan's local currency has been devalued during different exchange regimes, which may substantially affect energy consumption and CO2 emissions. Therefore, this study investigates the effects of exchange rate depreciation on Pakistan's CO2 emissions and energy consumption from 1990–2018. We apply the nonlinear autoregressive distributed lag (ARDL) cointegration approach for the empirical analysis and found that exchange rate depreciation increases CO2 emissions and energy consumption in both the short and long runs. These results suggest that currency devaluation has an expansionary effect which enhances economic growth at the cost of high energy consumption and CO2 emissions. Therefore, the government needs regulations along with an exchange rate policy to control CO2 emissions. Moreover, the government should search for alternate energy resources such as renewable energy resources that meet the country's energy needs and mitigate CO2 emissions.

A Symmetry and Asymmetry Investigation of the Nexus Between Environmental Sustainability, Renewable Energy, Energy Innovation, and Trade: Evidence From Environmental Kuznets Curve Hypothesis in Selected MENA Countries

The motivation of the study is to gauge the role of renewable energy consumption (REC), energy innovation (EI), and total trade (TR) on environmental sustainability (ES) in selected MENA (Middle East and North Africa) countries for the period 1980–2018 under the assumption of environmental Kuznets curve (EKC). The study implemented several econometrical tools, including structural break unit root test, Bayer–Hanck combined cointegration test, autoregressive distributed lag (ARDL), nonlinear ARDL, and Granger causality test under error correction term. Variables properties test detected that all the variables are stationary after the first difference but neither exposed to stationary after the second difference. The test statistics of the combined cointegration test documented a long-run association between ES, RE, EI, and TR, which is valid for both countries concerned. Regarding EKC concern, study findings with ARDL and nonlinear ARDL validated the EKC hypothesis for Tunisia and Morocco. Finally, the direction causality test documented unidirectional causality between renewable energy and ES, trade and ES, but the feedback hypothesis holds between EI and ES. We can advocate for specific sectoral environmental reforms in Tunisia and Morocco and suggest continuous environmentally friendly technologies by combining study findings. At the same time, subsidies on nonrenewable energy should be reduced, and green trade policies to help advance sustainable development should be implemented.

The Asymmetric Impact of Economic Growth, Energy Consumption, Population, and R&D on Carbon Emission in Turkey

The presented study analyzes the asymmetry effect of research and development (R&D) expenditures, population growth, energy consumption, and economic growth on carbon emissions in the sample of Turkey for the period 1990-2020. Nonlinear ARDL is used to control the asymmetry of the variables. Linear ARDL is used to control the long-term and short-term relationships between the variables. The findings show that there is a symmetrical or linear relationship between the variables of R&D expenditures, population growth, energy consumption, economic growth, and carbon emissions. The findings display that economic growth and R&D are effective in reducing carbon emissions, while energy consumption seems to increase carbon emissions. Interestingly, the population was found to be effective in reducing carbon emissions in the study. In order for Turkey to reach its 2050 target, it is necessary to give priority to environmental regulations and policies.

Long-run asymmetric association between FDI and productivity in Turkey

Incoming foreign direct investments (FDI) may enhance the productivity level of the host country by bringing new advanced technologies. On the other hand, the nexus of FDI and productivity, rather than being linear, might be nonlinear because the effect of increases and decreases in FDI on productivity may not be symmetric. In this sense, this study investigates the asymmetric relationship between FDI and productivity in Turkey by using two different productivity indicators (i.e., PROD1 and PROD2) and employing a Nonlinear ARDL approach. Our hypothesis claims there is an asymmetric association between FDI and productivity in the long run in Turkey. Nonlinear cointegration test findings indicate that selected variables are cointegrated. Hence, they move together in the long run. Our study uses aggregated data at the macro level to analyze the long-term asymmetric relationship between foreign direct investment and labor productivity in Turkey using the NARDL estimation technique. Concerning the estimation results, a long-run nonlinear relationship between incoming FDI and labor productivity was detected, and this finding remained valid across two models constructed by using two distinct labor productivity indicators. As a whole, our results are consistent with the ones found in the literature. Besides, for the first time in the literature, this study addresses the long-run asymmetric nexus between FDI and labor productivity by using macro-level data specific to Turkey and makes various policy recommendations.

MODELING TOURISM–ENVIRONMENT RELATIONSHIP IN AUSTRALIA: DOES ASYMMETRY MATTER?

Prior empirical studies have employed various econometric estimation techniques to study the environmental effect of tourism demand. Prominently, these econometric modeling techniques implicitly assume that the environmental effect of tourism is symmetrical, which could sometimes be problematic. This study, therefore, utilized two econometric estimation techniques, namely, the Pesaran et al. ( 2001 ). Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics, 16(3), 289–326) symmetric autoregressive distributed lag (ARDL) and Shin et al. ( 2014 ). Modelling asymmetric cointegration and dynamic multipliers in a nonlinear ARDL framework. In Festschrift in Honor of Peter Schmidt, pp. 281–314. New York: Springer) nonlinear ARDL (NARDL) estimation technique to disentangle the effect of tourism demand on carbon emissions in Australia. The results from the symmetric ARDL model reveal that tourism demand significantly increases carbon emissions in the long run, indicating that a 1% increase in tourism demand contributes to a 0.155% increase in carbon emissions in the long run. Contrarily, the NARDL model shows that a positive shock (an increase) in tourism demand reduces carbon emissions while a negative shock (a decrease) in tourism demand increases carbon emissions in the long run. From the NARDL estimate, a 1% increase in tourism demand is associated with a 0.220% decline in carbon emissions, while a 1% decrease in tourism demand increases carbon emissions by 0.250%. Therefore, I argue that carbon emissions depend not only on the size of tourism demand but also on the pattern — thus the increase and decline — of tourism demand. The implications of these results for policy are discussed.

Asymmetric effect of financial development and remittance on economic growth in MINT economies: an application of panel NARDL

The empirical analysis examines the asymmetric effect of financial development and remittance on economic growth in MINT nations (Mexico, Indonesia, Nigeria, and Turkey). The present study utilized panel data covering the period from 1980 to 2019. The research objectives are to address the questions: (a) Is there a long-run association between economic growth and the regressors? (b) Do financial development and remittance trigger MINT nations' economic growth? Moreover, the present study applied both linear panel ARDL and the novel panel nonlinear ARDL to capture the asymmetric impact of development and remittance on economic growth. The outcomes of the linear ARDL disclosed that both financial development and remittance triggers economic growth positively. Furthermore, the outcomes of the NARDL disclosed that both positive and negative shocks in financial development increase economic growth. In addition, a positive and negative shock in remittance increases economic growth in the long-run.