Public Capita and Growth: The Role of Institutions in Development

This study analyzes the links between public capital and growth using an econometric model of simultaneous equations, estimated on a panel of forty-three developing countries over the period 2003-2020. This growth model explains the determinants of GDP and public and private capital stocks. The accumulation of public, private and human capital generates externalities that are sources of endogenous growth. However, the formation of public capital generated a crowding out effect, to the detriment of that of private capital, because of differentiated budgetary constraints. Our results show that several developing countries have moved away from an optimal structure for the growth of sharing of available capital between the public and private sectors. In doing so, are institutions a prerequisite for the economic development of African countries.

IPO, private capital? Not! SPAC!

The introductory part of the article is devoted to a brief overview of the typical methods of raising funds for a company’s capital. Then, I compared The pros and cons of each approach. Further, the author introduces the company’s new fundraising – through the merger with a SPAC (from now on referred to as the merger with SPAC). The article discusses the advantages and disadvantages of this option for a company to enter public capital markets or raise capital in a company compared to the already traditional methods – raising private capital and entering public capital markets through an IPO. As a result of this comparison, the author concludes that the merger with SPAC has the advantages of both classical options for raising capital, without their disadvantages, which makes this option a unique offer on the market. Statistical data confirmed this conclusion. The separate section in the article is devoted to the peculiarities and complexities of the merge with SPAC. The advantages of the merger with SPAC for the leading Russian companies compared with other types of capital raising are separately highlighted, and the contrast between the placement on the MICEX and the merger with SPAC. The article also presents statistics on the public capital market and the impact on the public market of the new opportunity for companies to go public. In the final section of the article, the author discloses the chain of events that brought the merger with a SPAC such a fame and popularity at the current moment in time. The article resulted in an explanation of the attractiveness of institutional investors’ investment of funds in companies that have chosen the merger with a SPAC as a potentiality for entering public capital markets.

Stock market dysfunctionality in Ukraine: factor of voucher privatisation

The author determines the peculiarities of privatisation processes in transformational economies compared with mature ones and considers the difference of the goal – to accelerate the development of the already existing stock market, and in fact, to create the market anew. Socio-economic transformations, privatisation of property and creation of market infrastructure are prerequisites but not a guarantee for the emergence of the domestic stock market as a specific institutional phenomenon, especially in the absence of adequate incentives for public equity. It is established that some local stock markets are degraded against the background of increasing size, globalisation, liquidity, and integration of world capital markets, including the Ukrainian one. It is stated that, unlike the neighbouring post-socialist states (firstly, Poland), the stock market has not been built in Ukraine as a basis for compelling attraction and allocation of capital. Paper substantiated that this is primarily a consequence of inefficient and protracted privatisation, mainly over-the-counter sale of shares, inconsistency of state and regulatory policy, optional iterations in the development of market infrastructure, the creation irrationality of privatised enterprises (even the smallest) exclusively in the form of open joint-stock companies, which die to their objective inability to raise public capital faced inadequate financial burden and coercion of listing on exchanges. The author identified the main problems of the Ukrainian stock market laid down during privatisation: excessively consolidated share capital structure, insecurity of minorities, meagre free-float and liquidity, conditional exchange pricing, the predominance of over-the-counter circulation of shares, etc. Emphasis is placed on the consequences of the attempt to implement the squeeze-out procedure in Ukraine. In the absence of market prices and the acquisition of control by dominant shareholders long before the legislative changes, the share buyback did not protect minorities. However, it led to significant investors’ losses, termination of circulation of shares of most issuers, even greater conditionality of indices, capitalisation and other indicators of market development. It is noted that the effectiveness of the announced state plans for the development of the stock market due to the privatisation of state property remains in doubt in the absence of prerequisites for balancing economic interests between market participants, the objectivity of pricing, incentives for public capital raising and effective institutional environment. It is concluded that in Ukraine, the focus on privatisation procedures in the stock market development has no prospects in the absence of adequate incentives for the public raising of capital.

Impact of Public Capital Expenditure on Inflation Rate in Nigeria

This paper examines the impact of public capital expenditure on inflation rate in Nigeria. The data for the study were sourced from various issues of the Central Bank of Nigeria’s statistical bulletin. The data was subjected to unit root test using Augmented Dickey fuller (ADF) approach to ascertain the time series properties. Descriptive statistics was used to assess the socioeconomic characteristics of the variables. Due to the mixed order of integration witnessed in the unit root, ARDL- Autoregressive Distributed Lag approach was used for cointegration and regression analysis. The result found that Public capital expenditure is negatively and statistically significant (tcal = -2.903) in influencing Inflation Rate in Nigeria. This outcome is highly directional in the sense that prudent and productive spending will always subdue inflation in any economy; therefore, this study recommend that government should increase its investment in production sectors and encourage skilful and willing citizens to participate, since this would reduce the expenses being incurred on business as a result low currency value and raise the profitability of firms.

Impact of Public Capital Expenditure on Economy Growth of Nigeria

The research investigates the relationship between governmental capital spending and economic development in Nigeria. Several issues of the Central Bank of Nigeria's statistics bulletin were used in the research, which yielded a large amount of data. The data was submitted to a unit root test, which was performed using the Augmented Dickey fuller (ADF) method, in order to determine its time series characteristics. The variables' socioeconomic characteristics were obtained via the use of descriptive statistics. Because of the varying order of integration seen in the unit root, cointegration and regression analysis were carried out utilizing the ARDL- Autoregressive Distributed Lag method, which is an acronym for Autoregressive Distributed Lag. The results show that public capital investment has a negative and statistically significant (tcal = -2.6996) impact on the Nigerian economy, as assessed by the GDP growth rate, according to the data. The results demonstrate that when capital expenditures in Nigeria get the attention they deserve, they have the potential to contribute to economic development in the country. This research recommends that the government manage capital spending in an appropriate manner in order to enhance the nation's productive capacity and accelerate economic development in light of the results.

Going Far by Going Together: James M. Buchanan’s Economics of Shared Ethics

We explore themes in Nobel Prize–winning economist James M. Buchanan’s work and apply his Ethics and Economic Progress to problems facing individuals and firms. We focus on Buchanan’s analysis of the individual work ethic, his exhortations to “pay the preacher” of the “institutions of moral-ethical communication,” and his notion of law as “public capital.” We highlight several ways people with other-regarding preferences can contribute to social flourishing and some of the ways those who have “affected to trade for the public good” might want to redirect their efforts. We show how Buchanan’s work has considerable implications for business ethics. Just as his economic analysis of politics changed how we understand government, we think his economic analysis of ethics can (and should) change how we understand business.

Government Capital Expenditure and Economic Growth: An Empirical Investigation

The purpose of this study was to investigate how capital government expenditure contributes to economic growth in East African countries. Many past empirical studies on the relationship between public capital spending and output growth show inconsistent results and mainly focus on total public expenditure. Hence, this study aims to determine the impact of public capital spending on economic growth using panel data series for East African countries. The secondary data sources were statistical abstracts and World Bank reports. To check if the variables have a relationship, this study used the panel least squares (OLS) estimation technique. The results showed that capital spending has a positive and significant effect on economic growth in East Africa. This research suggests that in East African economies, the strategy and policy of increasing government spending on the capital budget to promote economic growth will be appropriate, but fewer funds should be channeled towards recurrent programs.