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Bayesian dynamic systems modelling. Bayesian model averaging for dynamic panels with weakly exogenous regressors
Get PDFThis manuscript introduces the bdsm package,
which enables Bayesian model averaging
for dynamic panels with weakly exogenous regressors
— a methodology developed by Moral-Benito (2016).
The package allows researchers to simultaneously address model uncertainty and reverse causality.
The manuscript includes a hands-on tutorial
accessible to users unfamiliar with this approach.
In addition to calculating the model space and providing key BMA statistics, the package offers flexible options for specifying model priors, or including a dilution prior that accounts for multicollinearity. It also provides graphical tools for visualizing prior and posterior model probabilities,
as well as functions for plotting histograms
and kernel densities of the estimated coefficients.
Furthermore, the package enables researchers to compute jointness measures and perform Bayesian model selection
to examine the most probable models based on posterior model probabilities
The Corruption Paradox: Assessing Environmental Impacts in the GCC Region
Get PDFThis study examines the impact of corruption on environmental quality in GCC countries from 2003 to 2021, focusing in particular on direct and indirect impacts on CO2 emissions. We use two-stage least squares (2SLS) panel regression analysis to account for potential endogeneity and provide robust empirical evidence. The results show that corruption has a direct and significant positive effect on environmental quality. This suggests that some corrupt practices can lead to short-term emission reductions by delaying or distorting large, environmentally harmful projects. However, it also has indirect negative effects: corruption undermines economic growth and institutional integrity and ultimately worsens long-term environmental impacts. Overall, the positive effects of corruption on environmental quality are positive, although they are differentiated and context-dependent. In addition, the Environmental Kuznets Curve (EKC) hypothesis is tested. This suggests that after an initial decline in emissions, environmental destruction could resume as income levels rise. These findings provide valuable insights for policymakers seeking to strengthen institutional governance, eradicate corruption, and promote sustainable environmental policies in resource-dependent economies
AGRICULTURE AS AN ACCELERATOR FOR AFRICAN ECONOMIC SUSTAINABLE DEVELOPMENT
Get PDFAgricultural sector has been identified as the engine room for economic transformation for most African countries, which plays an important role in their economic transformation process via huge revenue generation, employment creation, source of foreign exchange and food supply to mentioned a few. The impact of agriculture sector on Africa countries economic growth has become a significant area of study. The main focus of this paper is to investigate the impact, explore the possibilities and highlight the teething challenges that have masked the significant roles of agricultural sector in the transformation process of the Nigeria’s economy from transforming from a developing one to advanced nation. This paper span from the period 1970 to 2010 by using annual times series data. The Ordinary Least Square (OLS) estimation method was adopted to examine the impact of agricultural sector in the economic growth of Nigeria. The variables employed include: Gross Domestic Product (GDP), output of agricultural sector, share of agriculture in the GDP, index of agricultural production, and ratio of agricultural output to GDP. The results of the analyses showed that the Nigeria agricultural sector contributes immensely to the economic growth of Nigeria but the over-dependence on the oil sector has over shadowed the potentials of the sector.
In conclusion, some of the recommendations made in the study are that: the Nigerian agricultural policy needs to be evolved; there is need for national re-orientation towards agriculture or farming, the activities of agriculture financing, institutions in providing finance and credit for rural farmers, should be supplemented with the provision of road networks, rail system and warehouses, in order to further encourage farmers to increase their production etc
Unwitting Markowitz’ Simplification of Portfolio Random Returns
Get PDFIn his famous paper, Markowitz (1952) derived the dependence of portfolio random returns on the random returns of its securities. This result allowed Markowitz to obtain his famous expression for portfolio variance. We show that Markowitz’s equation for portfolio random returns and the expression for portfolio variance, which results from it, describe a simplified approximation of the real markets when the volumes of all consecutive trades with the securities are assumed to be constant during the averaging interval. To show this, we consider the investor who doesn’t trade shares of securities of his portfolio. The investor only observes the trades made in the market with his securities and derives the time series that model the trades with his portfolio as with a single security. These time series describe the portfolio return and variance in exactly the same way as the time series of trades with securities describe their returns and variances. The portfolio time series reveal the dependence of portfolio random returns on the random returns of securities and on the ratio of the random volumes of trades with the securities to the random volumes of trades with the portfolio. If we assume that all volumes of the consecutive trades with securities are constant, obtain Markowitz’s equation for the portfolio’s random returns. The market-based variance of the portfolio accounts for the effects of random fluctuations of the volumes of the consecutive trades. The use of Markowitz variance may give significantly higher or lower estimates than market-based portfolio variance
The Natural Rate of Unemployment and the NAIRU: Theoretical Foundations, Empirical Evidence, and Policy Debates
Get PDFThis paper explores the concepts of the natural rate of unemployment and the non-accelerating inflation rate of unemployment (NAIRU). It discusses their theoretical foundations, empirical estimation, and policy implications. While both concepts have been central to macroeconomic theory and policymaking, they remain controversial. The analysis draws on historical developments, empirical evidence, and contemporary debates to evaluate the relevance of these concepts in modern economies
Nassau Senior and the Long-Term Effect of Tithes
Get PDFThe paper argues that Senior was still under the influence of Ricardo’s economics from the point of view of economic growth. Senior generally emphasised a sustainable growth of economy brought by the prudential check to population and the technological progress in agriculture, but it depended on wise institutions. However, on the other hand, he was familiar enough with Ricardian growth which enabled him to develop the initial effect of taxes, also existed in Ricardo, into the long-term consequences on the stationary state. In this sense, Senior was the orthodox successor of Ricardo, which means that his growth theory should be understood in the continuity with Ricardo’s growth theory
Winning at Cricket: How Game Theory Influences Team Tactics and Player Mindsets?
Get PDFGame theory offers a structured framework for
analyzing strategic decision making. This paper is trying
to examine strategic decision-making in cricket, where
both the teams aim to maximize their outcomes in a
competitive environment. By examining payoffs,
probabilities, and opponent strategies, we investigate the
interplay between possible risk and reward, bolstering to
more informed and effective tactics in the match
Emprendimiento en redes sociales
Get PDFEn la actualidad, las redes sociales han adquirido una gran
relevancia en el ámbito
empresarial, permitiendo a las pequeñas y medianas empresas (pymes) conectar con su
audiencia, promocionar sus productos y fortalecer su presencia en el mercado. A raíz de
la crisis del COVID-19, el emprendimiento digital ha experimentado un crecimiento
significativo, consolidándose como una vía clave para la generación de negocio.
El objetivo de este estudio es analizar el impacto del uso de redes sociales en el
emprendimiento, utilizando datos de la encuesta Future of Business Survey de Facebook,
que recoge información sobre cómo las pymes utilizan plataformas como Facebook,
Instagram y WhatsApp para desarrollar sus actividades. A través de un análisis
econométrico de datos agregados por país, se estudiarán las variables clave que
determinan el éxito de los negocios en redes sociales
Economic growth and income inequality: Non-linearities and income level threshold effect.
Get PDFDespite the pioneering works of Kuznets and Kaldor in the mid-fifties, it was not until the nineties that economists began to thoroughly investigate whether income inequality is detrimental or conducive to growth. A brief survey of the literature does not yield a definitive conclusion. Some authors argue that inequality is beneficial, as higher-income populations are more likely to save and invest in innovative activities. Conversely, other authors contend that concentrating income in the hands of a few limits the number of potential investors, hinders the development of markets and industries with increasing returns, and may dis-incentivize investment in human capital. Since the mid-nineties, most empirical studies attempting to uncover a link between income inequality and growth have concluded that the relationship is predominantly negative. In this study, we reveal a more complex link, characterized by an inverted-U shape that is mostly negative and only applicable to countries with intermediate income per capita. For poor and rich countries, this link does not exist. We employ a panel threshold model approach, introducing income inequality in linear, quadratic, and cubic forms to allow for potential linear, U-shaped, inverted-U-shaped, and even more complex relationships between inequality and growth
Introducing a new measure of inflation pressure for South Africa
Get PDFInflation dispersion affects the extent to which inflation harms welfare. As a result, inflation dispersion bears on the optimal inflation target and assessment of the appropriate stance of policy at any particular point in time. In this policy brief, we propose a new measure of inflation dispersion for South Africa, drawing on hundreds of goods and services categories to summarise inflation pressure in South Africa. We show that inflation dispersion describes divergences in inflation from the inflation target. Our analysis suggests that a lower average inflation level may not automatically imply lower inflation dispersion in South Africa, making it harder to anchor inflation expectations at a lower inflation target. This means that reforms to address persistently high administered price inflation and monetary policy communication focused on what policy must do to address inertial price and wage settings are particularly important