Search Results (140)

Debates relating to the sustainability of the environment have emerged as a major goal of the global agenda in recent years. As a result, this research examines the impact of outward foreign direct investment (OFDI) on carbon dioxide emissions (CO₂) in Turkey from 1985 to 2022, using the autoregressive distributed lag model (ARDL) and frequency domain causality analysis (FDCA). In addition, economic growth (GDP) and trade in services (TROP) were used as control variables because they capture two big ways the economy interacts with environment. The empirical results are as follows: (i) The bounds test confirms a long-run association among the variables. (ii) The ARDL result confirms that in the long and short run, OFDI and GDP increase CO₂ in Turkey, while TROP contributes to the quality of the environment. (iii) The FDCA demonstrates that OFDI Granger causes CO₂ in the short and medium term, while TROP Granger causes CO₂ in the short, medium, and long-term. Based on these results, policies are recommended for implementation. Full article

This study investigates the relationship between stock returns and income inequality in South Africa, a country marked by persistently high levels of income disparities and a sophisticated and structurally unique financial market. Despite the Johannesburg Stock Exchange (JSE) being one of the most developed and liquid markets in Africa, stock ownership remains limited to a small segment of the population, often reinforcing pre-existing income inequalities. This study determines the relationship between stock returns and income distribution using the ARDL bound test methodology. Using time series data from 1975 to 2024, the study examines the extent to which stock market returns influence income distribution. The findings of the study suggest a positive relationship between stock returns and income distribution. This relationship suggests that higher stock market development disproportionately benefits capital holders. The long-term relationship seems to have limited feedback from inequality to stock returns. The findings aim to inform policies on inclusive financial participation and broad-based wealth generation to address South Africa’s structural inequalities. Full article

Poultry price instability remains a critical challenge for food security in Nigeria. This study examines the relationship between poultry price volatility (PPV), exchange rate (LEXR), and inflation (LCPI) from 1991 to 2024 using the Autoregressive Distributed Lag (ARDL) model. Descriptive results show that PPV had the highest variability (mean 0.65; standard deviation 1.07), while LEXR and LCPI were relatively more stable. Trend analysis indicates that poultry price volatility was high in the early 1990s but declined steadily after 2005, coinciding with persistent inflation and cycles of exchange rate depreciation and appreciation.Unit root and bounds tests confirm that the variables werecointegrated, with an F-statistic of 4.50 exceeding the upper bound at 5 percent significance. The long-run estimates reveal that inflation hada negative effect on poultry price volatility (−0.109), while the exchange rate exerteda positive effect (0.2702). The errorcorrection term (−0.336) indicates a 33.6 percent adjustment to equilibrium each period. In the short run, changes in inflation (0.942) and lagged exchange rate variations significantly influenced poultry price volatility. These findings underscore the importance of stabilizing exchange rates and controlling inflation to reduce price volatility in Nigeria’s poultry sector. Full article

Using the Autoregressive Distributed Lag (ARDL) model cointegration framework, this paper examines the long- and short-run impact of domestic financial investment and natural resource rents on economic growth in Niger within the period 1990–2021. The Bounds test confirms a long-run relationship among variables: F = 4.646 > 3.79 at 5%. Long-run results indicate that increasing domestic investment by 1% raises real Gross Domestic Product (GDP) per capita by approximately 0.30%, whereas 1% increase in natural resource rents leads to a reduction in growth by approximately 0.06%. At the same time, exports have a positive but very small effect, while imports and labor have negative long-run influences. Short-run dynamics further support a significant positive impact of domestic investment, at p = 0.0007, and a lagged effect of natural resources at p = 0.0308. The error-correction term is negative and significant, at −0.75, showing rapid adjustment toward equilibrium. Diagnostic tests confirm an absence of serial correlation and heteroskedasticity, while stability is confirmed by CUSUM and CUSUMSQ tests. The findings reveal a dualism in the growth path of Niger in that domestic financial investments favor sustainable expansion, whereas resource-based revenues undermine the growth process in the long run and call for financial market deepening and improved governance of resource revenues. Full article

Inflation is an economic phenomenon that affects the growth of many countries around the world, especially African countries. Several studies have endeavored to determine the direction of its effect in developing countries, albeit with inconclusive results. Moreover, there is a paucity of studies on the moderating roles fiscal policy and monetary policy play in this relationship. This study examines the effect of inflation on Nigerian economic growth and the moderating roles of fiscal and monetary policies from 1986 to 2023. By employing the ARDL bound test, it was discovered that a long-run relationship exists, with a significant negative relationship in the short run. Also, the intervening role of government expenditure significantly worsens the effect, while the money supply insignificantly weakens the influence of inflation on economic growth in the short run. Notably, the moderating role of a coordinated fiscal and monetary policy has a favorable significant effect on the inflation–growth nexus. This study concludes that while inflation poses a serious threat to the Nigerian economy, the intervening roles of coordinated government expenditure and the money supply are significant to reduce the adverse effect. There is a pressing need for monetary authorities to utilize a coordinated fiscal and monetary policy to reduce the inflation rate to single-digit levels. Full article

Ethiopia presents a compelling paradox in sustainable development: despite decades of rapid economic growth, improvements in human well-being have not been commensurate. This study examines the role of global economic integration in resolving this paradox by analyzing the impact of trade openness (TOP) and foreign direct investment (FDI) on human development in Ethiopia from 1991 to 2021. We hypothesize that this paradox arises because the benefits of trade and FDI operate primarily through an income-growth channel, with a weaker direct effect on health and education capabilities. Moving beyond the standard Human Development Index (HDI), we construct a modified index (HDI*) that excludes the income component, allowing us to disentangle direct effects on health and education from indirect effects mediated through economic growth. Using the ARDL bounds testing approach, we find that TOP and FDI have significantly stronger long-run effects on standard HDI (0.343 and 0.214, respectively) than on the non-income HDI* (0.235 and 0.136). This indicates that approximately one-third (31.5%) of TOP’s and over one-third (36.4%) of FDI’s total benefit is income-mediated, while the remainder reflects direct capability enhancement. The analysis further reveals that institutional quality significantly amplifies these benefits, whereas inflation specifically undermines non-income dimensions, highlighting the acute vulnerability of social sectors to macroeconomic instability. We conclude that the Ethiopian paradox stems not from a failure of growth but from its weak translation into direct, sustainable gains in health and education. We recommend policies to strengthen institutional governance, attract FDI into health and education sectors, lower trade barriers for agricultural exports, and use trade agreements to address structural trade deficits and promote sustainable human development. Full article

This study examines the relationship between foreign direct investment (FDI) and economic growth in Romania during 2003–2023, by distinguishing the effects of FDI stock and FDI flow, with a focus on sustainable development. Because the variables have different integration orders, we used the ARDL model and the bounds test to check the long-run relationship between real GDP per capita and FDI stock, FDI inflows, exports, and labor productivity growth. The refined ARDL model (adjusted for multicollinearity) confirms a stable long-run equilibrium relationship among the variables, with all coefficients statistically significant at the 5% level. Long-run elasticities indicate that economic growth is primarily driven by FDI stock (0.23) and exports (0.24), validating the “export–investment nexus” hypothesis. Also, FDI inflows contribute positively (0.09), while labor productivity remains a critical internal determinant (0.03). Short-run dynamics, captured through the ARDL-ECM specification, reveal that only labor productivity exerts an immediate effect, whereas foreign capital plays a structural stabilizing role. The error correction term (–0.279) suggests an adjustment speed of approximately 27.9% annually, reflecting strong economic resilience across EU ascension (2007), financial crisis (2008–2009), and COVID-19 pandemic (2020–2021). Our study contributes to the literature regarding the effects of FDI in Romania, by simultaneously including FDI stock and flow and considering the pandemic period. Also, our study employs dynamic productivity specification and provides transparent model selection procedures within a sustainable framework. The results in this study are of interest for policymakers, emphasizing the need to focus on attracting quality FDI (green and high-tech investments, investor retention, and human capital development) which can facilitate sustainability-oriented strategies that could lead to sustainable economic growth. Full article

This study investigates the role of fossil fuel energy efficiency (FFE) in shaping environmental sustainability in Türkiye, with particular emphasis on the moderating effect of trade openness (TO) over the period 1982–2023. Environmental sustainability is proxied by the Load Capacity Factor (LCF), which integrates ecological footprint and biocapacity within the Load Capacity Curve (LCC) framework. Long-run relationships are examined using the Fourier ARDL bounds testing approach to account for structural breaks, while coefficient robustness is ensured through Fully Modified Ordinary Least Squares (FMOLS) and Canonical Cointegrating Regression (CCR) estimators. The empirical findings indicate that improvements in energy efficiency contribute positively to environmental sustainability, and this effect is significantly strengthened when energy efficiency interacts with trade openness (FFE × TO). This suggests that trade openness enhances the environmental gains of energy efficiency through technological spillovers. In addition, the results reveal an inverted-N-shaped nonlinear relationship between economic growth and environmental sustainability, indicating varying environmental pressures across different income levels. Overall, the findings highlight the importance of integrating trade policies with energy efficiency-oriented green technology strategies to achieve sustainable environmental outcomes in Türkiye. Full article

While extensive research has explored the determinants of foreign direct investment (FDI) and foreign portfolio investment (FPI) in BRICS nations, there remains a notable gap in understanding the influence of intangible factors, particularly soft power and nation branding. Historically, academic discourse has underemphasized the role of nation branding as a crucial emotional and perceptual component in investment decision-making processes. Consequently, governments in BRICS countries must enhance their national branding efforts to attract both capital and portfolio investment flows. The principal aim of this study was to jointly analyse the tangible and intangible determinants influencing FDI and FPI in BRICS from 1994 to 2024. Employing advanced econometric techniques, specifically the Autoregressive Distributed Lag (ARDL) bounds testing approach for cointegration and Vector Error Correction Models (VECM) for estimation. This study makes a unique contribution to existing literature by examining the nexus between nation branding, FDI and FPI, thereby introducing a novel perspective on the factors driving investment in the BRICS context with an emphasis on non-tangible determinants. The findings indicate that nation branding, along with exchange rate stability, property rights, and financial market development, are significant positive determinants of FPI in these countries. Conversely, capital openness demonstrated a negative relationship with FPI. Moreover, the positive impact of nation branding on FDI within BRICS nations was reaffirmed. This study substantiates the critical role of nation branding as a pivotal driver for both FDI and FPI, emphasising its strategic importance in the economic landscape of BRICS countries. Full article

This study examines how tourism development in Tunisia responds to environmental degradation, renewable energy consumption, technological innovation, and foreign direct investment. Using annual data for 1990–2023, we apply the Autoregressive Distributed Lag (ARDL) bounds approach to identify long-run equilibria and short-run dynamics and validate the results with Fully Modified Ordinary Least Squares (FMOLS). The bounds tests confirm stable long-run relationships among tourism development and its structural determinants—environmental degradation, renewable energy, technological innovation, and foreign direct investment. The empirical results show that environmental degradation depresses tourism development in the long run, whereas renewable energy and technological innovation promote it. Foreign direct investment provides the strongest positive contribution. Complimentary Granger causality tests confirm unidirectional causality from environmental degradation, renewable energy, and technological innovation to tourism development, and bidirectional causality between tourism and foreign direct investment, validating the robustness and direction of influences among variables. Short-run effects appear weaker and occasionally mixed; however, the negative and highly significant error-correction term indicates convergence toward equilibrium. The FMOLS estimates closely match the ARDL results, providing further confidence in the results. Accordingly, policymakers should bolster environmental management, increase renewable energy as part of tourism infrastructure, advance digital and eco-innovation, and attract FDI in cleaner technologies and higher standards of services. This study fills conceptual and regional evidence gaps by integrating environmental, technological, and financial dimensions within a unified framework. It offers practical guidance consistent with the Sustainable Development Goals; specifically, Goals 7 (clean energy), 8 (sustainable growth and jobs), and 13 (climate action). Full article

The paper investigates the economic, social, and environmental determinants of Vietnam’s Human Development Index (HDI) for the years 1990–2023. Using the Autoregressive Distributed Lag (ARDL) bounds testing method, short-run and long-run relationships between HDI and GDP per capita growth, life expectancy, CO₂ emissions, trade openness, and unemployment are investigated. The results indicate that GDP per capita growth, CO₂ emissions, and trade openness positively and significantly influence HDI in both time periods, while unemployment has a negative influence. Life expectancy has a significant positive influence in the short term but is insignificant in the long term. Diagnostic tests validate the robustness of the model, and stability tests indicate parameter constancy. Robustness tests through the use of FMOLS, DOLS, and CCR estimators validate the main findings. The report provides policy-relevant suggestions for sustaining Vietnam’s human development gains, emphasizing how to reconcile economic growth with environmental sustainability and labour market inclusion. Full article

Empirical research has revealed conflicting associations between dependent and independent variables, with few studies tackling the dynamics in developing economies. This study investigates the effects of carbon dioxide emissions, renewable energy consumption (REC), foreign direct investment (FDI), government green capital spending (GGCS), and economic growth (EG) in Morocco, employing the Keynesian framework of economic growth. An autoregressive distributed lag (ARDL) methodology was applied to assess both short- and long-term relationships among the model’s variables, using annual data from the World Development Indicators (WDI) database for the period 1993–2020. All ARDL variables were transformed into first differences to ensure stationarity. The bounds test confirmed a long-term equilibrium relationship between the dependent and independent variables. Diagnostic tests, including the White test, indicated no evidence of heteroscedasticity, and the Shapiro–Wilk test confirmed that residuals followed a normal distribution, validating model robustness. The model demonstrated overall stability across the study period with no structural breaks. The empirical findings suggest that both carbon dioxide emissions and renewable energy consumption exhibit positive trends, whereas GGCS demonstrates a significant short-run negative correlation with economic growth. However, the long-term coefficients were found to be statistically insignificant, suggesting that sustained policy effects may be attenuated by macroeconomic structural factors. Full article

This study investigates the dynamic relationship between key macroeconomic indicators, specifically inflation (CPI), the Federal Funds Rate, GDP growth, unemployment, and money supply, and U.S. stock market returns, represented by the S&P 500 index, over the period January 2015 to June 2025. The objective is to understand how inflation and monetary policy affect market performance in both the short and long run. Using an Autoregressive Distributed Lag (ARDL) modeling framework and Error Correction Model (ECM), the study examines monthly S&P 500 returns alongside macroeconomic variables, accounting for lagged effects and potential cointegration. The model captures both immediate and delayed impacts, employing the Bounds Testing approach to confirm long-run equilibrium relationships. Results show significant mean-reversion in stock returns, a delayed negative impact of inflation and interest rate increases, and a positive contemporaneous response to GDP growth. Unemployment exhibits a counterintuitive positive effect on returns, suggesting forward-looking investor expectations. The money supply also positively influences equity prices, supporting liquidity-based asset pricing theories. This paper provides updated empirical evidence on macro-finance linkages and highlights the complex interplay of monetary policy, inflation, and market expectations in shaping U.S. equity returns. Full article

This study examines links between global financial stress and cryptocurrency returns from 1 January 2017 to 31 January 2025, while explicitly accounting for commodity markets. We use an econometric toolkit: unit-root and cointegration testing, ARDL bounds, Toda–Yamamoto causality, and a two-state Markov Switching model to trace long-run equilibrium and transmission mechanisms across cryptocurrencies (BGCI), systemic stress (OFR-FSI), volatility measures (VIX, VVIX, VSTOXX, VVSTOXX, MOVE), major equities and bonds, and three commodities (gold, oil, copper). Results show robust long-run cointegration between BGCI and several financial variables, including S&P/ASX 200 and the Bloomberg Barclays Bond Index; models that include commodities continue to support these long-term links. Toda–Yamamoto tests reveal that stress and volatility indices unidirectionally transmit shocks to cryptocurrencies and commodities, while gold displays a bidirectional relationship with BGCI, indicating a conditional safe haven interaction. Markov Switching estimates show amplified co-movement among BGCI, gold and bonds in stress regimes, with the model predominantly remaining in a normal state. Overall, cryptocurrencies are embedded within the broader financial system; commodities, especially gold, are used to moderate the stress crypto transmission and offer conditional diversification value during turmoil. Full article

This study employed quarterly data spanning from 2005 to 2024 to investigate the factors affecting China’s tea exports to Malaysia using demand theory. The Autoregressive Distributed Lag (ARDL) approach and Granger causality test were applied to examine the long-run and short-run impacts of key variables, including the prices of China’s tea and coffee imported by Malaysia, Malaysia’s GDP, Malaysia’s tea production, and the international oil price. The ARDL bounds testing confirmed the existence of a long-run equilibrium among these variables. The empirical findings revealed that an increase in the price of China’s tea significantly reduced export volumes, whereas Malaysia’s GDP exerted a strong positive influence. The price of coffee exhibited a significantly negative effect, suggesting an unconventional substitution relationship with tea. Both Malaysia’s domestic tea production and the international oil price imposed downward pressures on China’s tea exports. Furthermore, the Granger causality analysis indicated that the price of China’s tea, the price of coffee, and Malaysia’s GDP all exerted short-run effects on China’s tea exports to Malaysia. These findings contribute to the export demand literature and offer implications for policies aiming to enhance bilateral tea trade between China and Malaysia. Full article