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Economies, Volume 9, Issue 1 (March 2021) – 28 articles

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Open AccessArticle
International Investment Agreements Provisions and Foreign Direct Investment Flows in the Regional Comprehensive Economic Partnership Region
Economies 2021, 9(1), 28; https://doi.org/10.3390/economies9010028 - 02 Mar 2021
Abstract
The international investment agreements (IIAs) are a strategic policy instrument that member countries could use to achieve win-win cooperation. Meanwhile, the extension of the Association of Southeast Asian Nations (ASEAN) membership toward the Regional Comprehensive Economic Partnership (RCEP) membership has induced the rich [...] Read more.
The international investment agreements (IIAs) are a strategic policy instrument that member countries could use to achieve win-win cooperation. Meanwhile, the extension of the Association of Southeast Asian Nations (ASEAN) membership toward the Regional Comprehensive Economic Partnership (RCEP) membership has induced the rich and deep investment agreement that challenges the ASEAN countries to take advantage. This study demonstrates the effects of investment provisions in international investment agreements on the bilateral foreign direct investment (FDI) in the RCEP economies. It also investigates the effect of ASEAN membership on investment creation and investment diversion toward the RCEP region. Using panel data on RCEP countries during the period 2009 to 2018 and a Poisson pseudo-maximum likelihood estimator, the results show that the relationship between inward FDI and investment provisions in IIAs are positive and significant. Likewise, the investment protection, facilitation, and promotion provisions in bilateral investment treaties have positive and significant effects on the inward FDI. Moreover, the findings indicate that the ASEAN membership tends to cause the investment creation toward the RCEP region; and it is a stepping stone on the road to the investment policy framework for sustainable development. Full article
Open AccessArticle
The Impact of Foreign Direct Investment on Income Inequality in Vietnam
Economies 2021, 9(1), 27; https://doi.org/10.3390/economies9010027 - 01 Mar 2021
Abstract
Foreign direct investments (FDI) is an important determinant of economic growth. FDI does not only contribute to the growth and economic development but also affects income through contributing to economic development and the impact on employment and salary structure of developing countries. The [...] Read more.
Foreign direct investments (FDI) is an important determinant of economic growth. FDI does not only contribute to the growth and economic development but also affects income through contributing to economic development and the impact on employment and salary structure of developing countries. The aim of this paper is to analyze the impact of FDI on income inequality in Vietnam. This study is the first attempt to examine the impact of FDI on income inequality under the constraints of the institution and education levels. To address the potential endogeneity problem, this study adopts Genernalized Method of Moment (GMM) model to conduct the estimation. A two-step GMM model with robust standard errors is used in the study. Empirical results show that FDI tends to increase income inequality in Vietnam and the existence of a non-linearity relationship between FDI and income inequality is also validated. Moreover, the study finds that the effects of FDI on income inequality are different depending on the level of education and institutions of the host provinces in Vietnam. The results of this study imply that, in order to ensure sustainable development, Vietnam’s policies should focus on improving the quality of economic governance and the administrative reform efforts of the government of the provinces and cities. Besides, policies should focus on increasing investment in public education and improving human capital, which not only can reduce income inequality but also can attract more FDI inflows. Full article
(This article belongs to the Special Issue FDI (Foreign Direct Investment) and Economic Growth)
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Open AccessFeature PaperArticle
Corruption and Tax Burden: What Is the Joint Effect on Total Factor Productivity?
Economies 2021, 9(1), 26; https://doi.org/10.3390/economies9010026 - 01 Mar 2021
Abstract
A common conclusion in the literature is that both corruption and taxation hamper economic growth. It is also plausible that both affect total factor productivity, which, by the famous Solow residual, is a vital driver of economic progress. Moreover, corruption and tax burden [...] Read more.
A common conclusion in the literature is that both corruption and taxation hamper economic growth. It is also plausible that both affect total factor productivity, which, by the famous Solow residual, is a vital driver of economic progress. Moreover, corruption and tax burden are supposed to be intertwined. This paper focuses on the supposedly linked effects of corruption and tax burden on total factor productivity. The empirical study uses panel data from 90 countries for the time span of 1996–2014. The results show that both corruption and tax burden deteriorate total factor productivity, but that an increase in tax burden mitigates the negative effect of corruption. Full article
(This article belongs to the Special Issue Impact of Corruption on the Economy)
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Open AccessArticle
The Policy Framework of Natural Resource Management in Oil-Dependence Countries
Economies 2021, 9(1), 25; https://doi.org/10.3390/economies9010025 - 23 Feb 2021
Viewed by 134
Abstract
A variety of critical empirical studies are interested in and focused on complex issues related to natural resource management and resource curse, whilst less can be found combining diverse factors that affect the dynamics of this curse and mitigate it. The case study [...] Read more.
A variety of critical empirical studies are interested in and focused on complex issues related to natural resource management and resource curse, whilst less can be found combining diverse factors that affect the dynamics of this curse and mitigate it. The case study of Norway is used as the benchmark policy framework in oil-rich countries to invest oil revenues and set correct fiscal policies. In this study, an analytical framework was structured to evaluate the coherence of resource management with sustainability as a starting point, contributing to further assessments of how the adaptation of such policies is incorporated in resource management to mitigate the resource curse. The analysis also suggests that oil-rich countries can learn from Norway’s experience to mitigate this resource curse and utilize oil revenues in the interest of the country. In addition, the analysis helps in effective management and the protection of ecological resources as these are becoming an increasingly important strategic part of natural wealth. This study aimed to provide an overarching framework designed to help conceptualize key issues of natural resource management and the resource curse in oil-rich countries and understand the challenges facing those countries in managing the natural resources. Full article
Open AccessArticle
Generation Y’s Perception of Servant Leadership and Job Satisfaction
Economies 2021, 9(1), 24; https://doi.org/10.3390/economies9010024 - 20 Feb 2021
Viewed by 158
Abstract
Generation Y wants to know the reason for everything in their lives, they are curious and most importantly, their characteristic of questioning everything makes them stand out. At the same time, it is hard to influence their characteristic features such as their lack [...] Read more.
Generation Y wants to know the reason for everything in their lives, they are curious and most importantly, their characteristic of questioning everything makes them stand out. At the same time, it is hard to influence their characteristic features such as their lack of social skills, little respect for authority, and low level of commitment to their employers when Generation X management tactics are used. The purpose of this study is to better understand Generation Y, to examine their relations with servant leadership practices, and to determine what effects they have on businesses. The field study was made at an established organized industrial zone (OIZ) dating back to 1963. This OIZ is built on an area bigger than 10 million m2 and is divided into 5 subzones. It is currently home to 53,500 employees, has a gross foreign trade volume of $7,200,000,000 and is located in the western Aegean Region of Turkey. The data for the study was collected from 248 participants and scales tested for validity and reliability in Turkish. A model was developed using the data and then it was tested using the confirmatory factor analysis method. The study used Structural Equation Model (SEM) to define the causal relationships between latent variables with a model in the analysis of the data and test its compliance. The result of the analysis reveals that dimensions of accountability and forgiveness from servant leadership practices have a statistically significant effect on personal success, whereas empowerment, accountability, and personal success dimensions have statistically significant effects on job satisfaction. Modesty dimension does not have a significant effect on the personal success and job satisfaction and the dimensions of accountability and forgiveness do not have a significant effect on job satisfaction. In addition, empowerment dimension does not have a meaningful effect on personal success. There is need for more studies to support the accuracy of the result for modesty dimension, since it seems like there is no effect on personal success and job satisfaction. This is a pioneer study since it is an empirical one looking at the application of the servant leadership theory on Generation Y employees. Full article
(This article belongs to the Special Issue Leadership in Business and Economics)
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Open AccessArticle
The Effect of Education and Macroeconomic Variables on Corruption Index in G20 Member Countries
Economies 2021, 9(1), 23; https://doi.org/10.3390/economies9010023 - 16 Feb 2021
Viewed by 238
Abstract
The purpose of this study was to analyze the effect of several macroeconomic variables consisting of gross domestic products (GDP) per capita, economic openness, government effectiveness index, inflation, and the level of education on the corruption index in G20 member countries. This study [...] Read more.
The purpose of this study was to analyze the effect of several macroeconomic variables consisting of gross domestic products (GDP) per capita, economic openness, government effectiveness index, inflation, and the level of education on the corruption index in G20 member countries. This study focused on the effect of education on the level of corruption in the G20 member countries by treating other macroeconomic variables as control variables that were not analyzed in depth. This research used mixed methods with multiple regression with two stage least square (2SLS) estimation method followed by phenomenological analysis. This study found that primary education enrolment and the lifelong learning index did not significantly influence the level of corruption for all G20 member countries, developed member countries, and developing member countries. Secondary education enrolment showed a negative and significant influence on the level of corruption in all categories of countries (all members, developing, and developed countries). Tertiary education enrolment had a negative and significant influence on the level of corruption in all members and developing countries, but had a positive influence in the developed countries. GDP per capita had a contrasting influence: negative and significant influence in the developed countries, but positive and significant influence in the developing countries. Similar to secondary education, the government effectiveness index had a negative and significant influence in all categories of countries (all members, developing, and developed countries). In contrast, inflation and economic openness had a positive and significant influence on the level of corruption, but only in developing countries. The policy implication of this study is the prioritization of secondary education to tackle corruption problems. Full article
(This article belongs to the Special Issue Impact of Corruption on the Economy)
Open AccessArticle
Testing the Role of Trade on Carbon Dioxide Emissions in Portugal
Economies 2021, 9(1), 22; https://doi.org/10.3390/economies9010022 - 15 Feb 2021
Viewed by 210
Abstract
This article considers the relationship between trade intensity, energy consumption, income per capita, and carbon dioxide emissions from 1970–2016 for the Portuguese economy. Considering the arguments of monopolistic competition, the article tests the hypotheses of trade and energy consumption on climate change. We [...] Read more.
This article considers the relationship between trade intensity, energy consumption, income per capita, and carbon dioxide emissions from 1970–2016 for the Portuguese economy. Considering the arguments of monopolistic competition, the article tests the hypotheses of trade and energy consumption on climate change. We use the autoregressive distributed lag-ARDL model, quantile regression, and cointegration models such as fully modified ordinary least squares (FMOLS), canonical cointegration regression, and dynamic ordinary least squares (DOLS) as an econometric strategy. The econometric results have support with the literature review. The variables used in this research are integrated with the first differences, as indicated by the unit root test. The empirical study proves that trade intensity contributes to environmental improvements. However, energy consumption presents a positive impact on CO2 emissions. The econometric results also demonstrated that a sustainable environmental system exists in the long run. Full article
Open AccessArticle
Administrative Costs and Tariff Rates in the Presence of Customs Evasion: Evidence from Ecuador
Economies 2021, 9(1), 21; https://doi.org/10.3390/economies9010021 - 08 Feb 2021
Viewed by 253
Abstract
This paper seeks to assess the effectiveness of customs policies in increasing the resources devoted to controlling and inspection. Specifically, it seeks to analyze whether an increase in the administrative cost of collecting taxes on foreign trade in Ecuador contributes to reducing customs [...] Read more.
This paper seeks to assess the effectiveness of customs policies in increasing the resources devoted to controlling and inspection. Specifically, it seeks to analyze whether an increase in the administrative cost of collecting taxes on foreign trade in Ecuador contributes to reducing customs fraud. To this end, we identify and estimate a transfer function model (ARIMAX), considering information on foreign trade such as official international trade statistics report and tariff rates, as well as the execution of budgetary expenditure and Ecuador’s gross domestic product (GDP). The period under study includes quarterly series from 2006 to 2018. The results obtained by the model indicate that allocating greater material and budgetary resources to combat customs fraud does not always achieve the objective of reducing customs evasion. Full article
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Open AccessArticle
Tolerance, Cultural Diversity and Economic Growth: Evidence from Dynamic Panel Data Analysis
Economies 2021, 9(1), 20; https://doi.org/10.3390/economies9010020 - 05 Feb 2021
Viewed by 355
Abstract
This study aims to examine the impact of social tolerance of cultural diversity, and the ability to speak widely spoken languages, on economic performance. Based on the literature, the evidence is still controversial and unclear. Therefore, the study used panel data relating to [...] Read more.
This study aims to examine the impact of social tolerance of cultural diversity, and the ability to speak widely spoken languages, on economic performance. Based on the literature, the evidence is still controversial and unclear. Therefore, the study used panel data relating to (99) non-English speaking economies during the time period between 2009 and 2017. Following the augmented Solow model approach, the related equation was expanded, in this study, to include (besides human capital) social tolerance, the English language (as a lingua franca) and the level of openness. The model was estimated using the two-step system GMM approach. The results show that social tolerance of diversity and English language competence have a positive, but insignificant impact on the economy. Regarding policy implications, government and decision-makers can avoid the costs deriving from cultural diversity by adopting democratic and effective institutions that aim to achieve cultural justice and recognition, which, in turn, enhance the level of tolerance, innovation and productivity in the economy. Moreover, to ease intercultural communication within heterogeneous communities, it is necessary to invest in enhancing the quality of second language education which is necessary to make society more tolerant and the country more open to the global economy. Full article
(This article belongs to the Special Issue The Application of Time Series Analysis in Economic Growth)
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Open AccessArticle
How Do Women Managers Avoid Paying Bribes?
Economies 2021, 9(1), 19; https://doi.org/10.3390/economies9010019 - 04 Feb 2021
Viewed by 239
Abstract
Previous studies have found that firms where women have greater influence are less likely to pay bribes than other firms. In this study, we ask how these firms avoid paying bribes. Using data from the World Bank’s Enterprise Surveys, we find that firms [...] Read more.
Previous studies have found that firms where women have greater influence are less likely to pay bribes than other firms. In this study, we ask how these firms avoid paying bribes. Using data from the World Bank’s Enterprise Surveys, we find that firms run by women avoid meeting and interacting with government officials when they can. Female-managed firms, for example, are less likely to apply for construction and import licenses, less likely to meet with tax officials, and less likely to bid for government contracts than male-managed firms. However, female-managed firms are no less likely to say that officials sought bribes when they met with them than male-managed firms. This suggests the main way that firms with women in positions of power avoid paying bribes is by avoiding situations where officials might seek them. Full article
(This article belongs to the Special Issue Impact of Corruption on the Economy)
Open AccessArticle
Corruption, Taxation and the Impact on the Shadow Economy
Economies 2021, 9(1), 18; https://doi.org/10.3390/economies9010018 - 04 Feb 2021
Cited by 1 | Viewed by 414
Abstract
While assessing the economic impacts of corruption, the corruption-related transmission channels which influence taxation as such have to be duly considered. Taking the example of the Czech Republic, this article aims to evaluate the impacts corruption has on the size of the shadow [...] Read more.
While assessing the economic impacts of corruption, the corruption-related transmission channels which influence taxation as such have to be duly considered. Taking the example of the Czech Republic, this article aims to evaluate the impacts corruption has on the size of the shadow economy as well as on the individual sources of long-term economic growth, making use of a transmission channel through which corruption affects the tax burden components. Using the method of an extended DSGE model, it confirms the initial assumption that an increase in perceived corruption supports the shadow economy’s growth, but at the same time, it demonstrates that corruption and especially its perception has a significantly different effect on two key areas—the capital accumulation and the labour force size. It further identifies another sector of the economy representing taxes which are prone to tax evasion while asserting that corruption has a much more destructive effect on this sector of the economy, offering generalized implications for other post-communist EU member states in a similar situation. Full article
(This article belongs to the Special Issue Impact of Corruption on the Economy)
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Open AccessArticle
Earnings Management in Frontier Market: Do Institutional Settings Matter?
Economies 2021, 9(1), 17; https://doi.org/10.3390/economies9010017 - 04 Feb 2021
Viewed by 247
Abstract
We analyse whether differences in earnings management practices in frontier countries can be explained by institutional settings, considering their diverse corporate governance environments, legal regimes, and accounting standards. Across 22 frontier market countries from 2000–2017, we find that financial disclosure, legal environments, and [...] Read more.
We analyse whether differences in earnings management practices in frontier countries can be explained by institutional settings, considering their diverse corporate governance environments, legal regimes, and accounting standards. Across 22 frontier market countries from 2000–2017, we find that financial disclosure, legal environments, and the number of analysts following to be correlated with reduced levels of earnings management (EM). The impact of wealth, GDP growth, firm size, and the use of Big-4 auditors were also associated with reduced EM. Contrary to developed markets and novel to this study, higher levels of societal trust failed to show significance in its ability to constrain EM, suggesting informal institutions are less influential as control monitors. Findings herein verify that the factors that moderate EM are not universally applicable, and help highlight international differences in the management of earnings. Full article
Open AccessArticle
Social Aspects of Tourism Policy in the European Union. The Example of Poland and Slovakia
Economies 2021, 9(1), 16; https://doi.org/10.3390/economies9010016 - 04 Feb 2021
Viewed by 244
Abstract
Since the beginning of the 21st century, the European Union tourism policy has been increasingly focused on initiatives in the field of social tourism, which are one of the ways of achieving sustainable development in the European tourism economy. Most of the research [...] Read more.
Since the beginning of the 21st century, the European Union tourism policy has been increasingly focused on initiatives in the field of social tourism, which are one of the ways of achieving sustainable development in the European tourism economy. Most of the research projects that have so far been conducted in the field have focused on the benefits for its participants (subjective one: Children and youths, seniors, disabled people, people (families) with low incomes and/or unemployed, big families). However, there is a lack of research on the analysis of the place of social aspects of tourism in the general socio-economic policy of the state and, in a detailed aspect, in the sectoral policy represented by tourism policy, as well as its potential impact on the development of the national economy and meeting tourism needs of the society. The authors tried to fill this research gap in this study. The aim of the study is to differentiate the issues related to the social aspects of tourism policy from the entire socio-economic policy pursued in the European Union and selected member states (Poland and Slovakia). The article is of a theoretical–analytical–conceptual nature. Empirical research, due to the nature of its issues, was conducted with the use of qualitative research methods. The results of the conducted research showed that activities in the field of social tourism policy are conditioned by organizational solutions for the entities that undertake them, as well as economic ones, especially in the field of financing. Moreover, they made it possible to propose the concept of a model social tourism policy with an indication of its place in the European policy on the basis of the past and future EU financial perspectives. Full article
Open AccessArticle
Linkage between Leaders’ Behaviour in Performance Management, Organisational Justice and Work Engagement in Public Sector
Economies 2021, 9(1), 15; https://doi.org/10.3390/economies9010015 - 03 Feb 2021
Viewed by 249
Abstract
In the last decade, leaders’ behaviour in performance management has been gaining increasing attention, arguing that it is beneficial in terms of improved employee attitudes, behaviour, and performance in the public sector. However, empirical support for such claim is still scant. Given the [...] Read more.
In the last decade, leaders’ behaviour in performance management has been gaining increasing attention, arguing that it is beneficial in terms of improved employee attitudes, behaviour, and performance in the public sector. However, empirical support for such claim is still scant. Given the relevance of work engagement and organisational justice in the public sector and acknowledging a worldwide employee engagement crisis, the paper aims at revealing the linkage between leaders’ behaviour in performance management, organisational justice, and employee engagement in the public sector. In doing this, quantitative data were collected in a survey from employees working in the public sector in Lithuania (299 responses). The findings showed that goal setting and feedback had a significant and positive effect on employee engagement, supporting the theoretical notion that leaders’ behaviour in performance management was crucial in engaging people. As it was expected, goal setting and feedback had a positive effect on organisational justice; meanwhile, organisational justice significantly and positively predicted employee engagement. Turning to the mechanism by which leaders’ behaviour influences work engagement, it seems that organisational justice partly mediated the relationships between goal setting and employee engagement and fully mediated the relationships between feedback and work engagement. These findings affirm that public sector should strive for improving the leaders’ behaviour in performance management as it in turn might impact overall organisational performance. Full article
(This article belongs to the Special Issue Leadership in Business and Economics)
Open AccessArticle
Causal Interaction between FDI, Corruption and Environmental Quality in the MENA Region
Economies 2021, 9(1), 14; https://doi.org/10.3390/economies9010014 - 03 Feb 2021
Viewed by 332
Abstract
The present work analyzes the impact of foreign direct investment (FDI) and corruption on the quality of the environment in the MENA region. Indeed, the magnitude of corruption and the quality of institutions are often cited as the main factors affecting the FDI [...] Read more.
The present work analyzes the impact of foreign direct investment (FDI) and corruption on the quality of the environment in the MENA region. Indeed, the magnitude of corruption and the quality of institutions are often cited as the main factors affecting the FDI inflow. Here, the Autoregressive Distributed Lag (ARDL) approach was used to examine data on a group of MENA countries from 1990 to 2016. Our findings verify the Environmental Kuznets Curve. Furthermore, the empirical estimates approve the “pollution haven” hypothesis, which postulates that the polluting industrial activities of developed countries shift to developing countries which have less stringent environmental regulations. Based on the study findings, we recommend greater awareness of the harmful effects of corruption among political and economic actors. Full article
Open AccessArticle
Applying Quantum Mechanics for Extreme Value Prediction of VaR and ES in the ASEAN Stock Exchange
Economies 2021, 9(1), 13; https://doi.org/10.3390/economies9010013 - 03 Feb 2021
Viewed by 292
Abstract
The advantage of quantum mechanics to shift up the ability to econometrically understand extreme tail losses in financial data has become more desirable, especially in cases of Value at Risk (VaR) and Expected Shortfall (ES) predictions. Behind the non-novel quantum mechanism, it does [...] Read more.
The advantage of quantum mechanics to shift up the ability to econometrically understand extreme tail losses in financial data has become more desirable, especially in cases of Value at Risk (VaR) and Expected Shortfall (ES) predictions. Behind the non-novel quantum mechanism, it does interestingly connect with the distributional signals of humans’ brainstorms. The highlighted purpose of this article is to devise a quantum-wave distribution methodically to analyze better risks and returns for stock markets in The Association of Southeast Asian Nations (ASEAN) countries, including Thailand (SET), Singapore (STI), Malaysia (FTSE), Philippines (PSEI), and Indonesia (PCI). Data samples were observed as quarterly trends between 1994 and 2019. Bayesian statistics and simulations were applied to present estimations’ outputs. Empirically, quantum distributions are remarkable for providing “real distributions”, which computationally conform to Bayesian inferences and crucially contribute to the higher level of extreme data analyses in financial economics. Full article
(This article belongs to the Special Issue The Theory Applications of Finance and Macroeconomics)
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Open AccessArticle
Participating to Compete: Do Small Firms in Developing Countries Benefit from Global Value Chains?
Economies 2021, 9(1), 12; https://doi.org/10.3390/economies9010012 - 02 Feb 2021
Viewed by 457
Abstract
Standard trade theory suggests that the profile of exporting firms is characterized by large firms which dominate domestic productivity distribution. Large manufacturing multinationals have increased their productivity by participating, creating and shaping global production networks. In recent decades, trade flows have become increasingly [...] Read more.
Standard trade theory suggests that the profile of exporting firms is characterized by large firms which dominate domestic productivity distribution. Large manufacturing multinationals have increased their productivity by participating, creating and shaping global production networks. In recent decades, trade flows have become increasingly dominated by trade-in-tasks within global production networks. Given the importance of pro-competitive effects in establishing the gains from trade following trade liberalizations, it is important to look at the link between participation in global value chains and a firm’s competitiveness. The paper does so by using the International Trade Centre’s competitiveness index, for small, medium-sized and large firms, coupled with global value chain participation measures extracted from multi-regional input-output tables, and together forming a panel dataset at country and firm category level. The main finding establishes that the gains from integration into value chains are greater for small firms than for large firms. In particular, at the sample median, an increase of participation by 2.5% reduces the competitiveness gap between small and large firms by 1.25%. In addition, the analysis suggests that it is the use of foreign inputs that drives the result. In contrast, the domestic value in intermediate goods matters only in cases where value chains respond to domestic demand needs. The identification strategy relies on a fractional probit model allowing for unobserved effects, and a causal framework using the depth of trade agreements as instrument, in order to mitigate potential reverse causality. Full article
(This article belongs to the Special Issue Trade and Investment Policy and Global Value Chains)
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Open AccessArticle
Moderate Innovator Trap—Does the Convergence of Innovation Performance Occur in the World Economy?
Economies 2021, 9(1), 11; https://doi.org/10.3390/economies9010011 - 01 Feb 2021
Viewed by 323
Abstract
Based on β and σ convergence analysis, we find a high persistence of innovation gaps for international innovation indices reported by the European Commission. Our research confirms the diverging scientific potential across the analyzed economies. Estimation provides evidence of convergence in the case [...] Read more.
Based on β and σ convergence analysis, we find a high persistence of innovation gaps for international innovation indices reported by the European Commission. Our research confirms the diverging scientific potential across the analyzed economies. Estimation provides evidence of convergence in the case of R&D expenses and the relative position on the global technological frontier. We propose a simple fixed effect panel regression measuring relative innovativeness potential. Our model suggests that current ranking leaders, i.e., Nordic countries (Sweden, Denmark, and Finland) and Germany, are likely to further outpace the United States. Central and Eastern European countries are achieving the greatest relative gains but are unlikely to exceed 70% of US potential. Peripheral European countries, South Africa, Turkey, and Russia are projected to further lose their innovativeness position despite their weaker initial position. Full article
Open AccessArticle
A Metafrontier Analysis on the Performance of Grain-Producing Regions in Norway
Economies 2021, 9(1), 10; https://doi.org/10.3390/economies9010010 - 01 Feb 2021
Cited by 1 | Viewed by 357
Abstract
Previous application of the stochastic frontier model and subsequent measurement of the performance of the crop sector can be criticized for the estimated production function relying on the assumption that the underlying technology is the same for different agricultural systems. This paper contributes [...] Read more.
Previous application of the stochastic frontier model and subsequent measurement of the performance of the crop sector can be criticized for the estimated production function relying on the assumption that the underlying technology is the same for different agricultural systems. This paper contributes to estimating regional efficiency and the technological gap in Norwegian grain farms using the stochastic metafrontier approach. For this study, we classified the country into regions with district level of development and, hence, production technologies. The dataset used is farm-level balanced panel data for 19 years (1996–2014) with 1463 observations from 196 family farms specialized in grain production. The study used the true random effect model and stochastic metafrontier analysis to estimate region level technical efficiency (TE) and technology gap ratio (TGR) in the two main grain-producing regions of Norway. The result of the analysis shows that farmers differ in performance and technology use. Consequently, the paper gives some regionally and farming system-based policy insights to increase grain production in the country to achieve self-sufficiency and small-scale farming in all regions. Full article
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Open AccessArticle
Analysis of the Territorial Efficiency of European Funds as an Instrument to Reduce Labor Gender Differences
Economies 2021, 9(1), 9; https://doi.org/10.3390/economies9010009 - 27 Jan 2021
Viewed by 316
Abstract
Gender equality has been one of the goals of the European Union since 1957. Article 157 of the Treaty on the Functioning of the European Union authorizes the European Parliament and the Council to adopt all those measures that guarantee the application of [...] Read more.
Gender equality has been one of the goals of the European Union since 1957. Article 157 of the Treaty on the Functioning of the European Union authorizes the European Parliament and the Council to adopt all those measures that guarantee the application of the principle of equality opportunities and equal treatment for men and women in employment and occupation matters. The main goal of this article was to determine whether the use of European Funds by Eurozone countries has made it possible to reduce labor differences in gender matters. To this end, the efficiency levels of the Funds are analyzed in two different periods, 2007 to 2013 and 2014 to 2020. Data Envelopment Analysis (DEA), a methodology frequently used by researchers in efficiency analyses, was applied. Among the main conclusions obtained are that the efficiency levels from the period 2014 to 2020 have been higher than that obtained in the previous period, but there are significant and persistent differences over time in the levels of gender efficiency between the different countries of the Eurozone. Full article
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Open AccessEditorial
Acknowledgment to Reviewers of Economies in 2020
Economies 2021, 9(1), 8; https://doi.org/10.3390/economies9010008 - 26 Jan 2021
Viewed by 221
Abstract
Peer review is the driving force of journal development, and reviewers are gatekeepers who ensure that Economies maintains its standards for the high quality of its published papers [...] Full article
Open AccessArticle
The Impact of Transportation on the Croatian Economy: The Input–Output Approach
Economies 2021, 9(1), 7; https://doi.org/10.3390/economies9010007 - 21 Jan 2021
Viewed by 370
Abstract
The aim of this paper was to determine the economic impact of the transportation sector on the Croatian economy by using input–output analysis. According to the input–output tables for the Croatian economy for 2004, 2010, 2013, and 2015, output and gross value-added multipliers [...] Read more.
The aim of this paper was to determine the economic impact of the transportation sector on the Croatian economy by using input–output analysis. According to the input–output tables for the Croatian economy for 2004, 2010, 2013, and 2015, output and gross value-added multipliers were calculated. The results of the conducted analysis indicated that the multiplicative effects of the transportation sector in Croatia were significant in the observed period, especially for the air transport sector. Furthermore, comparative multiplier analysis with selected European Union countries was performed to assess the Croatian transportation industry position from an international perspective. Lower output and gross value-added multipliers for the Croatian transportation sector imply that old European Union member states capitalized the transportation sector more for growth and development. The Croatian transportation sector recorded lower imported intermediate inputs, average domestic inputs, and higher value-added multipliers similar to new European Union members. Simulations based on multiplicative effects show that restrictions on movements and human contacts, imposed due to the COVID-19 pandemic, could induce a strong reduction in the economic activity of transport and other sectors that are included in the value-added chain of the transport industry. Full article
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Open AccessArticle
A Review of the Applications of Genetic Algorithms to Forecasting Prices of Commodities
Economies 2021, 9(1), 6; https://doi.org/10.3390/economies9010006 - 19 Jan 2021
Viewed by 355
Abstract
This paper is focused on the concise review of the specific applications of genetic algorithms in forecasting commodity prices. Genetic algorithms seem relevant in this field for many reasons. For instance, they lack the necessity to assume a certain statistical distribution, and they [...] Read more.
This paper is focused on the concise review of the specific applications of genetic algorithms in forecasting commodity prices. Genetic algorithms seem relevant in this field for many reasons. For instance, they lack the necessity to assume a certain statistical distribution, and they are efficient in dealing with non-stationary data. Indeed, the latter case is very frequent while forecasting the commodity prices of, for example, crude oil. Moreover, growing interest in their application has been observed recently. In parallel, researchers are also interested in constructing hybrid genetic algorithms (i.e., joining them with other econometric methods). Such an approach helps to reduce each of the individual method flaws and yields promising results. In this article, three groups of commodities are discussed: energy commodities, metals, and agricultural products. The advantages and disadvantages of genetic algorithms and their hybrids are presented, and further conclusions concerning their possible improvements and other future applications are discussed. This article fills a significant literature gap, focusing on particular financial and economic applications. In particular, it combines three important—yet not often jointly discussed—topics: genetic algorithms, their hybrids with other tools, and commodity price forecasting issues. Full article
Open AccessArticle
Brand and Firm Value: Evidence from Arab Emerging Markets
Economies 2021, 9(1), 5; https://doi.org/10.3390/economies9010005 - 12 Jan 2021
Cited by 2 | Viewed by 423
Abstract
This study aims to estimate the impact of brand as the most important intangible marketing asset on firm value, measured by share return in some Arab emerging market, as well analyze the moderating role of agency costs in the relationship between share return [...] Read more.
This study aims to estimate the impact of brand as the most important intangible marketing asset on firm value, measured by share return in some Arab emerging market, as well analyze the moderating role of agency costs in the relationship between share return and brand. We use the Ohlson model of valuation with a sample of the most traded companies on four markets under study. The panel data regression results show a significant impact of brand on return as well as agency costs that promote the valuation model power, meaning that good corporate governance increases the degree of marketing investment efficiency in value creation. Our findings support the literature relating to the residual earnings valuation model. Furthermore, the results confirm the informative content of marketing application besides the traditional accounting figures as a promising approach for firm valuation. Full article
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Open AccessArticle
A Debt Market Model for the BRICS
Economies 2021, 9(1), 4; https://doi.org/10.3390/economies9010004 - 12 Jan 2021
Viewed by 379
Abstract
The author introduces an approach for a consensual economic policy for a group of rapidly developing countries as a response to contemporary global economic challenges. This article reconsiders the problems of international economic integration in the period of deglobalization. The author puts forward [...] Read more.
The author introduces an approach for a consensual economic policy for a group of rapidly developing countries as a response to contemporary global economic challenges. This article reconsiders the problems of international economic integration in the period of deglobalization. The author puts forward the hypothetical model of a debt market of BRICS-bonds. The paper discusses approaches to servicing government debt and budget deficits in the BRICS based on the shared framework of financial and economic institutions. The author formulates the possibilities of a shared economic policy in the BRICS that could help overcome the consequences of the crisis caused by COVID-19. The author proposes a unique budget deficit optimization approach for the BRICS. The article evaluates the options for automatic and state-run budget deficit services and identifies the optimal level of taxation and the average weighted tax rate for the BRICS. The author investigates the potential of the BRICS to use financial resources of the shared debt market based on the gradualist approach for a consensual economic policy. Full article
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Open AccessArticle
Impact of Economic Freedom on Corruption Revisited in ASEAN Countries: A Bayesian Hierarchical Mixed-Effects Analysis
Economies 2021, 9(1), 3; https://doi.org/10.3390/economies9010003 - 05 Jan 2021
Viewed by 516
Abstract
Conceptual and applied studies assessing the linkage between economic freedom and corruption expect that economic freedom boosts economic growth, improves income, and reduces levels of corruption. However, most of them have concentrated on developed and developing groups, while the Association of Southeast Asian [...] Read more.
Conceptual and applied studies assessing the linkage between economic freedom and corruption expect that economic freedom boosts economic growth, improves income, and reduces levels of corruption. However, most of them have concentrated on developed and developing groups, while the Association of Southeast Asian Nations (ASEAN) countries have drawn much less attention. Empirical findings are most often conflicting. Moreover, previous studies performed rather simple frequentist techniques regressing one or some freedom indices on corruption that do not allow for grasping all the aspects of economic freedom as well as capturing variations across countries. The study aims to investigate the effects of ten components of economic freedom index on the level of corruption in ten ASEAN countries from 1999 to 2018. By applying a Bayesian hierarchical mixed-effects regression via a Monte Carlo technique combined with the Gibbs sampler, the obtained results suggest several findings as follows: (i) In view of probability, the predictors property rights, government integrity, tax burden, business freedom, labor freedom, and investment freedom have a strongly positive impact on the response perceived corruption index; (ii) Government spending, trade freedom, and financial freedom exert a strongly negative effect, while the influence of monetary freedom is ambiguous; and (iii) There is an existence of not only random intercepts but also random coefficients at the country level impacting the model outcome. The empirical outcome could be of major importance for more efficient corruption controlling in emerging countries, including ASEAN nations. Full article
(This article belongs to the Special Issue Impact of Corruption on the Economy)
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Open AccessArticle
‘Sequencing Economics’ on the ICT Industry Agglomeration for Economic Integration
Economies 2021, 9(1), 2; https://doi.org/10.3390/economies9010002 - 01 Jan 2021
Viewed by 405
Abstract
In this paper, we seek to establish ‘sequencing economics’ in an architectural theory on agglomerations that are comprised of various segments, such as infrastructure, institutions and human resources. The sequencing of such segments is based on a causal chain, with the notion of [...] Read more.
In this paper, we seek to establish ‘sequencing economics’ in an architectural theory on agglomerations that are comprised of various segments, such as infrastructure, institutions and human resources. The sequencing of such segments is based on a causal chain, with the notion of ‘economies of sequence’ regarded as a tool with which to efficiently sequence the segment construction, as defined by Granger causality relationships. The use of ‘new economic geography’ for cases in which such economies of sequence were applied to the information and communication technology (ICT) industry, the paper concludes that as the starting conditions for the sequencing of the segments of the agglomeration, the value of the share of skilled workers exceeds the threshold value at which the symmetric equilibrium shifts to an agglomeration equilibrium. The results of Granger causality testing identified that an increase in research expenses Granger-causes an increase in the number of patents, and an increase in the number of patents Granger-causes an increase in value added. Based on our results, we conclude that when sequencing the segments of an agglomeration in the ICT industry, the development and invitation of researchers is a precondition, and that the procurement of research funds for patent development precedes any increase in patents. Subsequently, the procurement of funds is necessary for the development of products based on the patents. Full article
(This article belongs to the Special Issue Anti-Globalization vs. Regional Integration)
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Open AccessArticle
Does Foreign Direct Investment and Trade Promote Economic Growth? Evidence from Albania
Economies 2021, 9(1), 1; https://doi.org/10.3390/economies9010001 - 01 Jan 2021
Viewed by 574
Abstract
Albania has experienced a rapid transition from a centrally planned economy to a mixed economy since the fall of communism in 1989. Policy changes, trade liberalization, and privatization have come about at a rapid pace, allowing foreign direct investment (FDI) and international trade [...] Read more.
Albania has experienced a rapid transition from a centrally planned economy to a mixed economy since the fall of communism in 1989. Policy changes, trade liberalization, and privatization have come about at a rapid pace, allowing foreign direct investment (FDI) and international trade to become key components of Albania’s economy. Against this backdrop, this study investigates the relationships among FDI, trade, and economic growth in Albania. Annual time-series data were obtained from the World Bank. Then, the following econometric tests were performed on the variables representing FDI inflows, exports, and GDP as proxies for FDI, trade, and economic growth: the unit root test; the unit root test with a structural break; Johansen cointegration analysis; the error correction model; and the Granger causality test. The results revealed a long-term relationship between FDI, trade, and economic growth. The Granger causality tests found unidirectional causality. Economic growth brought about exports and FDI in the short term but not vice versa. In conclusion, policymakers need to design policies that promote technology-based, export-promoting FDI to meet the needs of the economy and develop specialized sectors that are competitive in the global market. Furthermore, the salient takeaway is that the penetration of export markets should be promoted as much as the furtherance of FDI. Full article
(This article belongs to the Special Issue FDI (Foreign Direct Investment) and Economic Growth)
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