Economies

The rapid digitalisation of retail banking has been promoted as a driver of efficiency and innovation. However, when digital strategies prioritise cost reduction over accessibility, they can generate financial exclusion among older adults. This paper examines how citizen mobilisation can place age-related financial exclusion onto corporate and regulatory agendas, using the Spanish petition “Soy mayor, pero no idiota” as a single case study. Launched in December 2021 by a 78-year-old retired physician, the petition gathered nearly 650,000 signatures and denounced exclusion caused by branch closures and forced digital migration. Drawing on agenda-building theory and Miguel Reale’s three-dimensional theory of law, the analysis traces how a private grievance became a public and institutional problem. Within weeks, Spanish banking associations introduced inclusive measures. Shortly afterwards, Law 4/2022 was approved. While the legislative process had already begun months earlier, the petition coincided with—and may have contributed to—specific banking- and age-related provisions. The findings show that digital banking strategies can heighten age-related vulnerability when they ignore digital literacy and accessibility gaps. Situating the case within the financial-inclusion literature (including the FATF 2025 guidance), the study also highlights unintended consequences of digitalisation such as over-indebtedness, scams and privacy risks. Citizen mobilisation, framed around dignity, prompted industry self-regulation and reinforced legislative attention to inclusion. Full article

This study examines the effects of population, unemployment rate, construction costs, income per capita, and interest rates on housing prices using annual data from 1990 to 2024. Adopting time series econometric analyses, including stationarity, the ARDL model, VAR, Granger causality and dynamic estimation of VDC and IRF. The results confirm a long-run equilibrium relationship between housing prices and the selected macroeconomic variables. Income per capita and construction costs positively influence housing prices, whereas interest rates have a significant negative effect. In the short run, only income per capita is significant. The findings provide important policy insights for improving housing affordability through sustainable income growth, prudent monetary policy, and efficient housing development. Future studies should incorporate regional and institutional factors to better explain housing price dynamics. Full article

The existing empirical literature on Morocco has examined FDI and economic growth, taxation and growth, and taxation and FDI separately. This study addresses this gap by investigating taxation’s moderating role in the FDI–growth nexus using Moroccan data from 1990 to 2024 and an Autoregressive Distributed Lag (ARDL) bounds-testing approach. The findings show that FDI is positively associated with long-run GDP growth, real GDP, and GDP per capita, whereas the aggregate fiscal burden and its interaction with FDI are negatively associated with these outcomes. Nevertheless, the marginal association of FDI remains positive across Morocco’s observed tax range, although it declines by 4.11%, 31.08%, and 13.47%, respectively. These findings show that the realised fiscal burden conditions the FDI–growth relationship. Full article

This article examines how dollarization reinforces the vulnerability of strategic sectors that are highly dependent on imports, using the Lebanese pharmaceutical sector as a case study. To this end, it employs a recursive dynamic computable general equilibrium model calibrated on a 2019 social accounting matrix to assess the effects of exchange rate shocks, constraints on access to foreign currency, and the weakening of healthcare financing mechanisms. The results show that these effects are transmitted mainly through three channels: the pass-through of import prices, the contraction of imports resulting from foreign currency scarcity, and the loss of household purchasing power resulting from the increase in out-of-pocket healthcare expenditures. The simulations reveal an increase in pharmaceutical prices, a decline in imports, a contraction in effective demand, and a deterioration of sectoral equilibria. These effects become particularly pronounced when price shocks and foreign currency constraints occur simultaneously. The results also highlight the central role of institutional healthcare financing mechanisms in amplifying or mitigating the effects of the crisis. The article therefore contributes to the literature on dollarized economies by proposing a conceptualization of sectoral vulnerability under dollarization, applicable to essential sectors exposed to supply disruptions. Full article

This study examines whether exports from Israel to MENA countries influence Israel’s military expenditure indirectly through Israel’s economic growth during the period 1995–2023. The analysis is conducted for three samples: the aggregate MENA region, MENA countries with diplomatic relations with Israel, and MENA countries without diplomatic relations with Israel. Using Ordinary Least Squares (OLS) estimation and Wald tests, the results indicate that growth in Israel’s exports to the aggregate and diplomatic MENA samples contributes positively to Israel’s economic growth, which in turn significantly increases military expenditure. The indirect effect of exports on military expenditure through economic growth is found to be positive and statistically significant in these two samples. By contrast, no significant direct or indirect effects are observed for trade with non-diplomatic MENA countries. Overall, the findings suggest that trade can influence military expenditure indirectly through economic growth, particularly where stronger diplomatic and economic ties exist. Full article

Understanding the relationship between economic growth, energy use, and environmental degradation remains a key challenge for resource-dependent economies undergoing energy transition. This study re-examines the effects of economic growth, energy consumption, renewable energy, and capital formation on CO₂ emissions in Kazakhstan using annual data for 1992–2024. To account for structural changes and ensure robust inference, the analysis employs the Bai–Perron structural break test, the Autoregressive Distributed Lag (ARDL) approach, and alternative cointegration estimators including Fully Modified Ordinary Least Squares (FMOLS), Dynamic Ordinary Least Squares (DOLS), and Canonical Cointegrating Regression (CCR). The results reveal a stable long-run relationship among the variables. Economic growth and energy consumption significantly increase CO₂ emissions, indicating the persistence of a carbon-intensive growth pattern in Kazakhstan. The effect of renewable energy is not robust across estimation techniques and does not provide consistent evidence of an emissions-reducing impact. Capital formation also shows limited explanatory power for long-run environmental outcomes. Overall, the findings suggest that Kazakhstan has not yet achieved a decoupling between economic growth and environmental degradation. The study contributes to the literature by jointly incorporating structural breaks, multiple cointegration estimators, and an extended sample period within a country-specific framework. The results imply that expanding renewable energy capacity alone may be insufficient to improve environmental quality, highlighting the need for broader structural transformation and low-carbon development strategies. Full article

In South Africa, the culture and creative industry still faces structural constraints and rapid technological change. While digital infrastructure has opened new paths for creative production, distribution, and commercialisation, the extent to which digital connectivity and innovation translate into tangible, measurable performance in the creative economy remains a question. In this paper, the study investigates the short- and long-run relationships among technological innovation, telecommunications infrastructure, digital services intensity, and the performance of South Africa’s creative economy over the period 1999–2023 using an Autoregressive Distributed Lag (ARDL) model. The study uses patent applications as an indicator of formal innovation, as well as of fixed telecommunications infrastructure, digital services exports, and overall economic activity. The negative and marginally significant long-run association of digital services exports is also observed, while overall GDP is insignificant. The error-correction mechanism is negative and statistically significant, although its small magnitude suggests a slow recovery toward the long-run equilibrium. The study’s results show that the development of the creative economy is not only about increasing overall digital connectivity but also about innovation capacity and technological infrastructure within the creative innovation ecosystem. The study further observes that technological access alone is insufficient to achieve sector-level benefits and that it must be accompanied by stronger innovation support, commercialisation capabilities, and institutional support for creative companies. From a policy perspective, the findings call for greater attention to intellectual property development, innovation capabilities, digital production capacity, and infrastructure to help creative companies translate their technology into business. The study provides time-series evidence on the link between technological innovation, digital infrastructure, and creative economy performance in an African emerging-market context, and it offers policy-relevant insights for developing innovation-led creative sector development in South Africa amid uneven digital and economic development. Full article

This study describes the evolution and interrelationships of the main productive sectors in the Province of Cotopaxi, Ecuador, over 2001–2023 ($N=23$ annual observations), using provincial accounts from the Central Bank of Ecuador (BCE). The available series spans a legacy 2001–2006 statistical regime and a later 2007–2023 regime with a different monetary basis; sector definitions were therefore harmonized, and each sector-indicator series was standardized separately within its source regime before correlation analysis. Two-tailed Pearson correlations were calculated for Gross Value Added (GVA), Gross Production, and Intermediate Consumption. Robustness was evaluated with detrended residual/partial correlations that control separate linear trends by source regime and with within-regime first differences that exclude the 2006–2007 transition. In standardized levels, the strongest correlations with total GVA were observed for services ($r=0.957$, $p<0.001$), commerce ($r=0.953$, $p<0.001$), and agriculture ($r=0.933$, $p<0.001$). Gross Production showed the strongest associations for commerce ($r=0.959$, $p<0.001$), agriculture ($r=0.946$, $p<0.001$), and services ($r=0.888$, $p<0.001$), while Intermediate Consumption was most strongly associated with agriculture ($r=0.958$, $p<0.001$), commerce ($r=0.948$, $p<0.001$), and industry ($r=0.887$, $p<0.001$). The robustness checks substantially attenuated several level relationships; for industry, signs of GVA association reversed from positive at the level to negative after detrending; meanwhile, commerce and services retained comparatively consistent short-run associations in annual changes in GVA and Gross Production. The results are therefore interpreted as descriptive associations rather than causal effects: Pearson correlation coefficients cannot, by construction, establish the direction or mechanism of influence between sectors. Beyond these sectoral findings, the central contribution of this study is methodological: it illustrates why detrended and first-differenced robustness checks are necessary when Pearson correlations are computed from data spanning incompatible statistical regimes, a common challenge in regional statistics for developing countries. Full article

Nigeria’s digital economy has expanded rapidly, underpinned by growth in digital payments. This study investigates the influences of digital payment infrastructure growth on the liquidity reliability of cross-border banking systems within the West Africa region. Existing literature predominantly examines the effects of digital payment on liquidity in Nigerian banks; however, there is a paucity of knowledge regarding the influence of digital payment channels on liquidity resilience within multinational banks operating in varying regulatory environments in the West African region. This study takes advantage of monthly time-series data from 2011 to 2021 and employs an Autoregressive Distributed Lag (ARDL) framework to assess the short-run and long-run dynamics of digital payment infrastructure and the liquidity behavior of Nigerian cross-border banks. The results indicate that digital channels have different effects. In the long run, modern digital payment channels, especially electronic fund transfers, make liquidity more stable. Traditional channels, on the other hand, have weaker or short-term effects. The findings have significant implications for policymakers and regional regulatory harmonization within West African economics. Full article

Understanding the determinants of electricity consumption is essential for designing effective economic and energy policies in advanced economies. This study examines the macroeconomic, institutional, and environmental factors influencing electricity consumption in 19 Euro Area countries during 2006–2024. Using a balanced panel dataset and a fixed-effects regression model, the analysis examines the associations between electricity consumption and GDP per capita, manufacturing value added, regulatory quality, electricity prices, renewable energy share, and heating degree days. The results indicate that GDP per capita, manufacturing value added, and regulatory quality are positively associated with electricity consumption, suggesting that higher levels of economic development, industrial activity, and institutional quality are associated with higher electricity demand. In contrast, electricity prices and renewable energy are negatively associated with electricity consumption, highlighting the importance of market incentives and structural changes related to the energy transition. Heating degree days exhibited the strongest estimated association with electricity consumption, highlighting the importance of climatic conditions across the Euro Area. The study contributes to the energy economics literature by providing an integrated assessment of economic, institutional, and environmental drivers of electricity consumption within a highly integrated economic region. The findings offer relevant implications for policymakers seeking to balance economic growth, energy transition objectives, and long-term electricity demand management. Full article

We compare three families of Value-at-Risk and expected shortfall estimators—rolling historical simulation, GARCH(1,1) filtered historical simulation (FHS), and a walk-forward multi-quantile LSTM—on identical, strictly out-of-sample footing across thirty-nine developed, emerging, and frontier equity markets over 2005–2025 (192,789 market-days). The answer to the title question is no. Historical simulation fails the Christoffersen independence test in every market. Filtering repairs most of this: FHS passes conditional coverage in nineteen markets, attains a 4.9% breach rate against a 5% target, and prices expected shortfall essentially without bias (mean Acerbi–Székely Z₂ of −0.003). The neural measure improves on historical simulation but passes conditional coverage in only four markets and understates tail severity by roughly 20% (Z₂ = −0.195); it tracks filtered more closely than historical VaR (within-market correlation 0.53 versus 0.40, p < 0.001), which indicates that much of the neural signal is volatility filtering in disguise. Quadrupling the network narrows this gap without closing it. In the macroeconomic panel, however, the neural family is the least procyclical: a one-point rise in GDP growth compresses historical tail risk by 4.3% but neural risk by only 1.5%. Machine learning tail-risk measures should therefore be benchmarked against filtered, not merely unconditional, classical methods and used alongside rather than instead of them. Full article

Tourism, despite being popularly regarded as a leisure activity, is shaped by a complex set of influencing factors and itself generates complex consequences—economic, societal, and environmental. The interaction between economic growth, tourism, and the environment is a crucial policy challenge for transitional economies striving to achieve sustainable development. This paper analyzes the impact of income, international tourism receipts, and energy use on CO₂ emissions as a proxy for environmental deterioration for five Western Balkan economies over the period of 2007–2022. The empirical investigation is conducted following the Autoregressive Distributed Lag (ARDL)—Pooled Mean Group (PMG) approach, favoring a long-run relationship among all the variables with a moderate convergence towards the long-run equilibrium. Tourism development and energy use are significantly and positively associated with carbon emissions in the region, with energy use emerging as the most robust long-run driver of emissions. The results do not support the conventional Environmental Kuznets Curve (EKC). Instead, a U-shaped income–emissions relationship is found, with income levels in all the five economies lying above the corresponding thresholds implied by the common long-run relationship by the end of the sample period. These results call for urgent policy action towards sustainable tourism development and energy transition in the Western Balkan countries. Full article

Rural entrepreneurship is increasingly recognised as a critical driver of economic resilience and regional development, particularly in developing regions such as the Eastern Cape, South Africa. This exploratory study examines how entrepreneurial activities stimulate local economic growth, job creation, innovation, and community empowerment in Mnquma Local Municipality, where persistent unemployment and poverty remain significant challenges. Adopting an exploratory research design underpinned by a positivist philosophy, this study synthesises existing literature on the relationships among employment generation, economic contribution, innovation promotion, economic diversification, community engagement, and local supply chain development. Data were collected from 349 respondents drawn from a population of 3750 formally registered rural entrepreneurs. The data were analysed using descriptive statistics, reliability and validity tests, correlation analysis, and Partial Least Squares Structural Equation Modeling (PLS-SEM) in SPSS and SmartPLS, to examine the relationships among employment generation, economic contribution, innovation promotion, economic diversification, community engagement, supply chain development, and economic resilience. The findings suggest that strong rural entrepreneurship enhances local adaptability and supports sustainable economic performance in the face of external shocks. The study emphasises the importance of inclusive, evidence-based policies that promote rural enterprise development through improved financial mechanisms, infrastructure investment, and strengthened stakeholder networks; thereby providing localised insights to inform policy and sustainable development in South Africa. Full article

We study how relative wages are associated with sectoral exit across public-sector branches in the Netherlands. Sectoral exit is defined as no longer being employed in the same public-sector branch one year later. Using administrative individual-job data from Statistics Netherlands covering 2013–2022, we apply one-to-one nearest-neighbor propensity score matching on individual and job characteristics to compare public-service workers with similar workers employed outside the focal branch. The resulting wage differential provides a relative earnings benchmark rather than a direct measure of each worker’s actual outside option. We subsequently estimate logit models and report average adjusted predicted probabilities of sectoral exit. We find that lower relative hourly wages are associated with higher probabilities of sectoral exit in national government, municipalities, police, the military branch of defense, and healthcare. In contrast, wage differentials play a limited role in water management, provinces, and the justice department. In education, higher relative wages are associated with higher probabilities of sectoral exit. These estimates describe conditional correlations and should not be interpreted as causal effects of wages on exit. This paper contributes to the literature by documenting heterogeneity in the relationship between relative compensation and realized sectoral exit across a broad set of public-sector branches. Full article

Oil-exporting economies are notoriously sensitive to external shocks, but the importance of current oil revenue absorption for macroeconomic shock transmission has not been explored thoroughly. This paper constructs a stylized DSGE model to analyze how macroeconomic shock propagation differs under alternative degrees of current oil revenue absorption. The model combines calibration to resemble Kazakhstan with Bayesian estimation. Six absorption rates are chosen that form three pairwise comparisons: 10% vs. 90%, 20% vs. 80%, and 40% vs. 60%. The model is analyzed under external oil demand, oil price, foreign output, total factor productivity, labor preference, and monetary policy shocks. Simulation impulse responses indicate that increased current absorption dramatically magnifies shocks that impact oil export income directly. External oil demand and oil price shocks exhibit strong responsiveness to changes in the absorption rate, while impulse responses to productivity, labor preference, monetary policy, and foreign output shocks display relatively little sensitivity to the absorption regime. For example, under the 10–90% comparison, the first period output response to an external oil demand shock increases from 3.195 to 19.481, while associated responses to a productivity shock cluster closely together with uncertainty bands that overlap extensively. Intermediate absorption comparisons maintain the same shock-specific conclusion while differences between regimes diminish as absorption rates get closer. This evidence suggests that the macroeconomic vulnerability of oil-exporting economies is a function not only of whether a shock is external, but also if it affects oil export income and has the capacity to interact with the oil revenue smoothing mechanism. These results lend support to intertemporal smoothing as a possible method to alleviate oil-income shock exposure in the short-run, but do not suggest an optimal level of current absorption. Full article

This paper estimates the short-run relationship between real output growth and unemployment in Albania over 1992–2023 and asks how sensitive that relationship is to the way crisis episodes are dated. Albania offers a demanding test: a transition economy with high informality, extensive self-employment and sustained emigration, whose sample contains three major shocks in three decades. We estimate first-difference specifications in which the change in the unemployment rate is regressed on output growth, with a lagged dependent variable capturing persistence and separate indicators for the three crisis episodes. Because conventional standard errors are unreliable at this sample size, we report alternative estimators alongside bootstrap inference and a full set of residual and stability diagnostics. Our main practical result concerns crisis dating. Crisis dummies are conventionally dated to the year a crisis began internationally, but for a small open economy whose transmission is indirect, the year in which a shock reaches domestic activity need not be that year. Albania did not contract in 2008 or 2009. We date the financial-crisis indicator from an external chronology of transmission—credit growth, non-performing loans, exports, investment, remittances and the fiscal stance—assembled from contemporaneous institutional sources and fixed before estimation, which places the arrival of the crisis in the Albanian economy in 2009 and 2010. The estimated crisis coefficient is highly sensitive to that choice: a 2008-dated indicator produces the best-fitting specification in this paper on every information criterion together with a large negative coefficient; the conventional 2008–2009 window straddles the turning point and returns an estimate indistinguishable from zero; the 2009–2010 window returns a positive one. These coefficients are individually imprecise, and their intervals overlap, so we do not claim that the data identify any one dating as correct, and we do not treat the sign of an estimate as evidence for or against a window. Our claim is narrower: the substantive conclusion a reader would draw about the crisis is determined by a specification choice that the data cannot settle, so the window has to be fixed ex ante on transmission evidence and its consequences reported. We demonstrate this for Albania and do not assert that published work on other countries is affected; we specify the test that would settle it. The dating choice leaves the estimated Okun coefficient itself almost unchanged. That coefficient is negative in every specification, estimator, subsample and phase definition we report, with a normal-times impact estimate of approximately −0.21, smaller in absolute value than the range reported for advanced economies. Its statistical significance is sensitive to the mode of inference: under the null-imposed bootstrap we regard as most appropriate at this sample size, the coefficient is not significant at conventional levels in the specification that carries that estimate. The evidence for the sign of the relationship is considerably stronger than the evidence for its magnitude, and comparisons of level with advanced-economy estimates should be read against that. The three crisis coefficients are large but imprecisely estimated, and restrictions of equality between them are not rejected, so we report them as descriptive magnitudes and do not rank the episodes. We validate the modeled unemployment series against the national Labour Force Survey over the years in which both exist and re-estimate the model on the national series; the crisis coefficients and the crisis-dating pattern are essentially unchanged. We do not detect a structural break at the 1997 pyramid-scheme collapse once dynamics and crisis indicators are jointly modeled, and we do not detect cyclical asymmetry, though the confidence intervals are wide enough that both are failures to detect rather than evidence of stability or symmetry. Full article

This study investigates the role of institutional policy support in enhancing climate adaptation strategies and maize productivity among smallholder farming households in Southwest Nigeria, a region critical for maize production yet vulnerable to climate variability. Employing a household-level data approach, data were collected from maize-based households across six states using questionnaires and interviews, supplemented by secondary climate and policy records. We employed a multivariate probit (MVP) regression with instrumental variable correction, addressing endogeneity in institutional support variables. Bayesian linear regression modeled maize yield as a function of institutional support, incorporating weakly informative priors and Markov Chain Monte Carlo (MCMC) sampling for posterior estimation. The Bayesian approach provides full posterior distributions and credible intervals, facilitates probabilistic interpretation of policy effects, improves estimation stability in the presence of multicollinearity, and enables rigorous sensitivity. Model robustness was evaluated via Bayesian fit metrics and sensitivity analysis with bootstrap resampling across prior types. Multivariate probit regression identifies institutional support, credit, irrigation, market access, and road infrastructure as key drivers of adaptation strategy adoption, modulated by socioeconomic (gender, experience) and farm-specific factors (farm size). Bayesian linear regression confirms significant yield impacts from institutional variables. Subgroup analysis indicates greater benefits for large farms over small farms, with gender-neutral impacts. While institutional support significantly boosts adaptation and productivity, gaps in irrigation access, climate information, and smallholder targeting limit equitable outcomes. The findings advocate for enhanced infrastructure, financial incentives, and tailored policies to strengthen climate resilience and food security, aligning with Nigeria’s climate goals and the Sustainable Development Goals. Full article

Evidence on the fiscal consequences of population ageing rests largely on projections and regional panels. We examine how ageing relates to growth and the primary fiscal balance across sixty-nine economies from 1990 to 2024. Because cross-sectional dependence is pervasive and slope homogeneity rejected, inference rests on outlier-robust common correlated effects and augmented mean-group estimators, with system generalised method of moments (GMM) used as a robustness check. First, ageing has no robust average effect on growth or the balance once slopes differ and common global movements are removed, and no convex fiscal profile survives. Second, the fiscal cost of ageing is concentrated in economies at earlier stages of the demographic transition, where a one-point rise in old-age dependency is associated with a primary balance weaker by about 1.2 percentage points of GDP, an ordering that survives every specification we estimate. Third, publicly financed health care carries that weight: one percentage point of GDP of such spending is associated with a balance weaker by 1.5 to 1.9 percentage points, while privately financed care shows no such association. The demographic push on that spending is itself weakly estimated and appears only with a lag. Containing such spending requires building health-financing and revenue capacity during the transition. Full article

This study examines the relationship between financial inclusion and economic growth, focusing specifically on the role of financial sector development in South Asia. The research encompasses annual data from five developing economies in South Asia: Bangladesh, India, Pakistan, Nepal, and Sri Lanka, during the period from 2000 to 2024. Multidimensional indicators of financial inclusion, economic growth, and financial sector development were generated using principal component analysis, while the panel autoregressive distributed lag–pooled mean group technique was applied to evaluate both long-run and short-run dynamics. The findings indicate that growth of the financial sector contributes significantly to economic development, providing its position as a major force behind economic expansion. The results suggest that financial sector development may represent a potential transmission channel linking financial inclusion and economic growth. The study highlights the importance of strengthening inclusive financial systems and financial sector institutions to achieve sustainable economic growth in South Asia, and offers policy recommendations for enhancing financial access, financial literacy, innovation, and financial market efficiency. Full article