176 research outputs found
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Economic integration and income convergence in the EU and the ASEAN
Full text linkAbstract. In this paper, examine per capita income convergence among the countries of the EU and the ASEAN during 2000-2014 using both beta and sigma convergence and theil index of inequality in order to to explain the process of structural change contributing to the process of income convergence. Our analysis of theil index of inequality indicates that the inter-country inequality, in general, has been decreasing for GDP in the EU and the ASEAN, which is in line with the findings of β- and σ- convergence for these two groups of countries during 2000-2014. While in the case of EU, reduction in inequality in the industrial sector has positively affected the reduction in inequality in income; for ASEAN, industrial and services sector have contributed to income convergence.Keywords. Convergence, EU, ASEAN, Theil Index of Inequality.JEL. O00, O10, O40
Climate change and profit efficiency in Punjab, Pakistan: Evidence from household-level panel data
Full text linkAbstract. This study seeks to examine, both theoretically and empirically, the impact of climate change on farm Profit efficiency in Rural Punjab Pakistan. Current study explores the climate change impact by using Stochastic Profit Frontier Model at farm level with panel data. The outcomes of this study are indicative of a strong impact of climate change on the agriculture of Punjab, Pakistan. Increase in long run normal precipitation and temperature have significant effect on farm profit that fluctuates in direction as well as magnitude across quarters. The incidence of weather shocks and socioeconomic characteristics of the farming households are important factors of profit efficiency at farm level. The quasi fixed inputs are positively and significantly related to farm profits while input prices contribute negatively to farm profitability. The average profit efficiency score turned out to be 0.72, suggesting that the average farm, by improving their efficiency can increase the profit up to 28 percent. The findings of present study are evocative of huge impact of climate change on the rain-fed areas of Punjab since these are water scarce areas depending on rain fall for cropping. Arguably, it is vital for the better performance of the agriculture sector to combat the impact of climate change more effectively through implementation of adaptation strategies.Keywords. Agriculture, Farm production, Climate change, Profit efficiency, Stochastic profit frontier model and farm level panel data.JEL. C23, D01, Q12
Evidence of random walk in Pakistan stock exchange: An emerging stock market study
Full text linkAbstract. The study reports the empirical evidence on the presence of weak-form efficiency under the random walk hypothesis on the emerging stock market of Pakistan; Pakistan stock exchange (PSX), formerly known as Karachi stock exchange (KSE) from January 01, 2009 to August 31, 2014, by investigating two categories of stock indices; one in which the selection of firms is based upon market capitalization and the other where the selection criteria of firms is based upon free-float methodology. The study applied both non-parametric and parametric tests; Kolgomorov-Simirnov (K-S), runs, serial correlation and unit root tests on daily returns of KSE-100 index; KSE- all share index; KSE-30 index and KMI-30 index. The study finds absence of random walk on the former two indices, where chronology of firms and selection criteria are based on traditional market capitalization technique. However, evidence of random walk is found in stock-indices where selection of firms is based on free floating methodology. The trace of random walk advocates the free floating methodology over market capitalization criteria.Keywords. Random walk, Weak-form efficiency, Karachi stock exchange, Pakistan stock exchange, Unit root test, Autocorrelation.JEL. G10, G12, G14
African emerging economies: The leading economies of Africa in the 21st Century
Full text linkAbstract. In the last couple of decades, some African countries have achieved a significant economic improvement even though it is overshadowed by the severe poverty and conflicts in the continent. In fact, some of these countries, such as South Africa, Nigeria, and Egypt are recognized as emerging economies by many international organizations. However, there are many other economies in the continent which achieved an equivalent economic improvement recently. The objective of this study is to assess the progress of all African countries and identify the African Emerging Economies. An index with various measurements which are commonly employed by similar studies is used. Considering, the absence of the topic from the literature, this study may attract further works. The results show that at least there are 15 African economies, including the three biggest ones, which recorded a remarkable progress in the last couple of decades. These countries can be recognized as African Emerging Economies. All of these countries are also categorized as either global emerging or frontier economies by various rating agencies.Keywords. African emerging, Emerging economies, Frontier economies.JEL. O10, O55, F02
The future of economic growth in the World’s largest economies
Full text linkAbstract. The future of economic growth is projected by solving differential equations describing growth rate date. Analysis was carried out for 12 countries representing the leading economies responsible for around70% of the global economic output. Out of all these countries, the most secure and stable economic growth is in Japan, Germany and France. In contrast, economic growth in China, India and Brazil are strongly insecure and potentially leading to the economic collapse. Economic growth in the United States, United Kingdom, Canada and Australia are on the border line. They also might become unsustainable. Economic growth in the remaining two countries, Italy and Russian Federation, is unpredictable. As for the preventive measures, for Japan, Germany and France, growth rate should be, if possible, maintained at a small value below 1%. Economic growth in these countries is described by logistic trajectories. Their asymptotic approach to a maximum value is hard to control but the growth rate should not be allowed to be substantially increased. For China, India and Brazil, growth rate should be now decreasing sufficiently fast to avoid the potential economic collapse. For the USA, UK, Canada and Australia, it would be also advisable to decrease their growth rate faster than in the recent years. For two countries, Italy and Russian Federation, it is essential to stabilise, if possible, their economic growth.Keywords. Gross Domestic Product; Future Economic Growth; Sustainable Economic Growth; Economic Collapse; USA, China, Japan, Germany, France, UK, Brazil, India, Italy, Canada, Russian Federation, Australia.JEL. A10, B41, C02, C20, C50, F00, F01
Interest rates volatility and its consequences on stock returns: The case study from Amman Stock Exchange, Jordan
Full text linkAbstract. This paper examines the special effects of interest rates on the stock market return by using monthly time series data for the economy of Jordan over the period of 2006 to 2016. An extensive variety of econometric procedures have been involved to analyze the relationship between the interest rate and stock market return. The study exposes a constant and significant long-run relationship between the variables. By using Cointegration methods the experimental in the long run represents that a one percent rise in interest rate causes (12.3459 %)reduction in market index. The assessed error correction coefficient highlight that (-0.678522) percent deviation of stock returns are corrected in the short run. Impulse response function of the study furthermore sustains the positive relationship between the variables. The result of Variance decompositions recommends that about (99.99705%) of the variation in stock market returns is referring to its own shock which denotes that stock market returns are mostly independent of the other variables in the structure. To go over the main points, Granger causality analysis yield that there is no presence of a unidirectional causality as of interest rate to the market index.Keywords. Stock market, Cointegration, Granger causality, Interest rate, ASE.JEL. E40, E43, G12
Managed the economy: Now time to manage the peace in Middle East
Full text linkAbstract. The paper utilizes religious philosophy to explain motivations for peace in Middle East where it is suggested in the paper that Kingdom of Saud-i-Arab has the potential to realize this goal.Keywords. Middle East, Business economics, Conflict resolution.JEL. E30, F20, F44
An introduction to the theories of institutional change
Full text linkAbstract. Institutional change explains the change of institutions considered as rules and expectations that govern human interactions and paths of development in society. This conceptual paper describes, with an historical perspective, the most important definitions of institution and of institutional change and shows some theories that analyze these critical topics in economics to assess similarities and differences. The future challenge of institutional scholars concludes this study.Keywords. Institutions, Institutional theory, Deinstitutionalization.JEL. D02, E02, G20, I20
The impact of macroeconomic variables on stock prices in Tanzania
Full text linkAbstract. This paper examines the relationship between stock prices and macroeconomic variables namely, inflation rate, Treasury bill rate, exchange rate and money supply in Tanzania. The paper uses monthly time series data spanning from January 2012 to December 2016 across 10 companies listed on the Dar es Salaam Stock Exchange. Johansen’s co-integration and vector error correction models have been applied to investigate the long-run relationship between stock prices and macroeconomic variables while considering average stock price on one hand and individual companies stock prices on the other hand. We specify 11 models, whereas model 1 examines the effects of macroeconomic variables on overall stock price, models 2-11 explore the effects of the same macroeconomic variables on individual firm’s stock price across 10 firms. This is important because some firms tend to behave differently as far as changes in macroeconomic variables are concerned. The empirical analysis reveals that macroeconomic variables and the stock prices are co-integrated across all models and, hence, a long-run equilibrium relationship exists between them. Equally important, all regression models pass the specification tests of heteroscedasticity, serial correlation, Ramsey RESET test of specification and Jacque-Bera Normality test. The overall model regression results show that money supply and exchange rate have a positive effect on stock prices. By contrast, Treasury bill rate tends to have a negative effect on stock prices. Inconsistent with the a priori expectation, inflation rate seems to exert no impact on overall stock prices. However, individual firms’ regressions show that the coefficient on inflation is negative and statistically significant in 6 models but weakly significant in 2 models, and positive and statistically significant in 1 model. Similar controversial results across firms are revealed on the other macroeconomic variables while considering individual firms regressions. Nevertheless, money supply is found to be the main determinant of stock and hence, it should be targeted as the main monetary policy aimed at directing the stock market in Tanzania.Keywords. Stock prices, Macroeconomic variables, Error correction models.JEL. D51, H54, O24
Competition between basic and applied research in the organizational behaviour of public research labs
Full text linkAbstract. The purpose of this paper is to investigate the competition between basic and applied research within public research organizations. International publications are considered here a proxy of basic research, whereas self-financing deriving from technology transfer activities is an indicator of applied research. Results suggest, within one of the largest European research organizations an increasing competition between basic and applied research, both in human and natural sciences, due to shrinking of public research lab budgets. In particular, institutes and scientists pay more attention to applied research activities, which are capable of attracting market funds for economic survival of public research labs but this organizational behaviour reduces basic research activity in the long run. Managerial and organizational behaviour of public research organizations are also discussed.Keywords. Applied research, Basic research, Public research organization, Public lab, Science policy, Organizational behaviour, Public management.JEL. B50, B59, I23, L20, L29, O33