Journal Description
Economies
Economies
is an international, peer-reviewed, open access journal on development economics and macroeconomics, published monthly online by MDPI.
- Open Access— free for readers, with article processing charges (APC) paid by authors or their institutions.
- High Visibility: indexed within Scopus, ESCI (Web of Science), EconLit, EconBiz, RePEc, and other databases.
- Journal Rank: JCR - Q2 (Economics) / CiteScore - Q1 (Economics, Econometrics and Finance (miscellaneous))
- Rapid Publication: manuscripts are peer-reviewed and a first decision is provided to authors approximately 21.7 days after submission; acceptance to publication is undertaken in 5.6 days (median values for papers published in this journal in the first half of 2024).
- Recognition of Reviewers: reviewers who provide timely, thorough peer-review reports receive vouchers entitling them to a discount on the APC of their next publication in any MDPI journal, in appreciation of the work done.
Impact Factor:
2.1 (2023);
5-Year Impact Factor:
2.2 (2023)
Latest Articles
Understanding Economic Integration in Immigrant and Refugee Populations: A Sco** Review of Concepts and Metrics in the United States
Economies 2024, 12(7), 167; https://doi.org/10.3390/economies12070167 (registering DOI) - 30 Jun 2024
Abstract
In an increasingly mobile world, the integration of immigrants and displaced individuals is an important factor in creating cohesive and inclusive societies. Integration has different dimensions; this sco** review examines the conceptualization and measurement of economic integration among immigrants and refugees in the
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In an increasingly mobile world, the integration of immigrants and displaced individuals is an important factor in creating cohesive and inclusive societies. Integration has different dimensions; this sco** review examines the conceptualization and measurement of economic integration among immigrants and refugees in the United States. Quantitative peer-reviewed journal papers measuring or conceptualizing the economic integration of first-generation documented adult immigrants or refugees in the United States, as well as relevant conceptual or theory papers on this topic, were included in the review. The search strategy included an online search of the Web of Science Core Collection, PsycINFO, Applied Social Sciences Index and Abstracts (ASSIA), and EconLit. Additional search strategies included scanning the reference lists of studies identified as relevant in the initial database search. An analysis of 72 studies included in the review using a data extraction table reveals seven key domains of economic integration: income and economic security, employment and occupational categories, assets and use of financial services, neighborhood and housing, health, education, and use of public assistance. Income and economic security emerged as the most common indicators of integration in the reviewed studies. Notably, less than half of the reviewed publications had a multidimensional approach to defining or measuring economic integration, and the majority of studies were focused on immigrants, with a smaller proportion dedicated to refugees. This review emphasizes the need for comprehensive frameworks in assessing economic integration among immigrants and refugees, reflecting the multifaceted nature of their economic integration experiences.
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(This article belongs to the Special Issue Economics of Migration)
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Asymmetric Analysis of Causal Relations in the Informality–Globalisation Nexus in Africa
by
Segun Thompson Bolarinwa and Munacinga Simatele
Economies 2024, 12(7), 166; https://doi.org/10.3390/economies12070166 (registering DOI) - 28 Jun 2024
Abstract
This study examines the causal relationship between informality and globalisation in 30 African countries. It deviates from traditional research by adopting a bi-directional framework to address reverse causality. By applying the DH causality method in both linear and nonlinear frameworks, this research challenges
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This study examines the causal relationship between informality and globalisation in 30 African countries. It deviates from traditional research by adopting a bi-directional framework to address reverse causality. By applying the DH causality method in both linear and nonlinear frameworks, this research challenges the assumption of a linear relationship and finds that the causal structure is better explained within a nonlinear asymmetric context. This paper provides recommendations based on the identified causal relationships. For countries in which globalisation leads to informality, such as Angola, Congo, Guinea, Gambia, Mozambique, Sierra Leone, Tunisia, Tanzania, Uganda, Zambia, and Zimbabwe, the paper suggests policy measures to integrate the informal sector into the formal economy. These measures include designing programmes to facilitate transition, implementing skill development initiatives, and establishing support mechanisms for entrepreneurship and small businesses. Additionally, this paper advises the development of social safety nets, improved market access, effective monitoring and regulation mechanisms, education on the benefits of globalisation, and international cooperation. For countries experiencing positive shocks from informality to globalisation, this paper recommends targeted support programs for entrepreneurship, initiatives to formalize the sector, the enhancement of market access, and skill development tailored to the needs of the informal sector. These policy recommendations aim to capitalize on the positive shocks in informality by fostering entrepreneurship, formalization, market access, and skill development. In the case of negative shocks in globalisation leading to positive shocks in informality, the paper suggests implementing resilience-building policies for the informal sector during economic downturns, establishing social safety nets, and adopting flexible labour policies.
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(This article belongs to the Special Issue Shadow Economy and Tax Evasion)
Open AccessArticle
Market Reactions to U.S. Financial Indices: A Comparison of the GFC versus the COVID-19 Pandemic Crisis
by
Dante Iván Agatón Lombera, Diego Andrés Cardoso López, Jesús Antonio López Cabrera and José Antonio Nuñez Mora
Economies 2024, 12(7), 165; https://doi.org/10.3390/economies12070165 - 27 Jun 2024
Abstract
This study delves into the impacts of the 2008 global financial crisis (GFC) and the COVID-19 health crisis on U.S. financial indices, exploring the intricate relationship between economic shocks and these indices during downturns. Using Markov switching regression models and control variables, including
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This study delves into the impacts of the 2008 global financial crisis (GFC) and the COVID-19 health crisis on U.S. financial indices, exploring the intricate relationship between economic shocks and these indices during downturns. Using Markov switching regression models and control variables, including GDP, consumer sentiment, industrial production, and the ratio of inventories-to-sale, it quantifies the effects of these crises on the CBOE Volatility Index (VIX), Standard & Poor’s 500 (S&P 500), and the Dow Jones Industrial Average (DJIA) from Q1 2000 to Q2 2023, covering crucial moments of both crises and stable periods (dichotomous variables). Results reveal that the 2008 crisis significantly heightened financial volatility and depreciated the valuation of S&P 500 and DJIA indicators, while the COVID-19 crisis had a diverse impact on market dynamics, particularly negatively affecting specific sectors. This study underscores the importance of consumer confidence and inventory management in mitigating financial volatility and emphasises the need for robust policy measures to address economic shocks, enhance financial stability, and alleviate future crises, especially during endogenous crises such as financial downturns. This research sheds light on the nuanced impact of crises on financial markets and the broader economy, revealing the intricate dynamics sha** market behaviour during turbulent times.
Full article
(This article belongs to the Special Issue Financial Market Volatility under Uncertainty)
Open AccessArticle
A Self-Adaptive Centrality Measure for Asset Correlation Networks
by
Paolo Bartesaghi, Gian Paolo Clemente and Rosanna Grassi
Economies 2024, 12(7), 164; https://doi.org/10.3390/economies12070164 - 27 Jun 2024
Abstract
We propose a new centrality measure based on a self-adaptive epidemic model characterized by an endogenous reinforcement mechanism in the transmission of information between nodes. We provide a strategy to assign to nodes a centrality score that depends, in an eigenvector centrality scheme,
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We propose a new centrality measure based on a self-adaptive epidemic model characterized by an endogenous reinforcement mechanism in the transmission of information between nodes. We provide a strategy to assign to nodes a centrality score that depends, in an eigenvector centrality scheme, on that of all the elements of the network, nodes and edges, connected to it. We parameterize this score as a function of a reinforcement factor, which for the first time implements the intensity of the interaction between the network of nodes and that of the edges. In this proposal, a local centrality measure representing the steady state of a diffusion process incorporates the global information encoded in the whole network. This measure proves effective in identifying the most influential nodes in the propagation of rumors/shocks/behaviors in a social network. In the context of financial networks, it allows us to highlight strategic assets on correlation networks. The dependence on a coupling factor between graph and line graph also enables the different asset responses in terms of ranking, especially on scale-free networks obtained as minimum spanning trees from correlation networks.
Full article
(This article belongs to the Special Issue Complex Networks on Macroeconomics and Finance: Models, Methods, Applications)
Open AccessArticle
Brake Segment for Agglomeration Policy: Engineers as Human Capital
by
Akifumi Kuchiki
Economies 2024, 12(7), 163; https://doi.org/10.3390/economies12070163 - 27 Jun 2024
Abstract
A “segment” is a component of the organization of an agglomeration. The organization of agglomeration is formed by the construction of segments. Manufacturing agglomeration segments can be divided into four main categories: human resources including engineers, physical infrastructure, institutions, and living environment. Each
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A “segment” is a component of the organization of an agglomeration. The organization of agglomeration is formed by the construction of segments. Manufacturing agglomeration segments can be divided into four main categories: human resources including engineers, physical infrastructure, institutions, and living environment. Each segment then has a specific function in the process of building industrial agglomeration. We focus on the process of building segments in agglomeration formation. We define a “brake segment” as a segment that has a “function” to decelerate the speed of the process. The purpose of this paper is to identify the existence of this brake segment in the process of constructing the segments of the manufacturing agglomeration. We obtained the following three results. First, a modified version of the spatial economic model yields that the number of agglomerated firms is inversely related to the wages of skilled workers. Second, a factor analysis of the data on investment environment costs indicates that in the case of the manufacturing industry, the number of agglomerated firms are inversely related to the wages of engineers. Third, the factor analysis of the six countries in the JBIC survey reveals that the segment that poses the investment issue in foreign direct investment in India is engineers as human capital. We conclude that engineers as human capital are a brake segment. The implication is that the sustained development of “engineers” as human capital is essential for the success of manufacturing industry agglomeration.
Full article
(This article belongs to the Special Issue Industrial Clusters, Agglomeration and Economic Development)
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Open AccessArticle
Can Remittance Promote Tourism Income and Inclusive Gender Employment? Function of Migration in the South African Economy
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Sandra Makwembere, Paul Acha-Anyi, Abiola John Asaleye and Rufaro Garidzirai
Economies 2024, 12(7), 162; https://doi.org/10.3390/economies12070162 - 26 Jun 2024
Abstract
With globalisation and international trade, remittances and migration significantly influence economic activities, yet their impact on tourism income and gender-specific employment remains under-researched. This study uses autoregressive distributed lags and Granger causality to examine the effects of remittances and migration on tourism income
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With globalisation and international trade, remittances and migration significantly influence economic activities, yet their impact on tourism income and gender-specific employment remains under-researched. This study uses autoregressive distributed lags and Granger causality to examine the effects of remittances and migration on tourism income and employment in South Africa. Three models are established as follows: for aggregate employment, male employment, and female employment, each with equations for tourism income and employment. Key findings from this study indicate that remittances significantly drive tourism income in both the short and long run across all models. Conversely, employment negatively impacts tourism income, hinting at sectoral trade-offs. Migration positively affects tourism income in the short run for male and aggregate models but is insignificant for female employment. Remittances boost male employment in both the short and long run, whereas their impact on female employment is significant only in the long run. Causality analysis shows a bidirectional relationship among employment indicators, with unidirectional causality from remittances to migration and from migration to income. This study recommends policies to support remittance inflows and their productive use in tourism, along with targeted interventions to reduce gender disparities in employment and promote equitable economic opportunities.
Full article
(This article belongs to the Special Issue Economics of Migration)
Open AccessArticle
Debt Puzzle: A Comparative Analysis of Public Debt’s Impact on Production Efficiency across OECD Countries
by
Usama R. Al-qalawi and Arqam Al-Rabbaie
Economies 2024, 12(7), 161; https://doi.org/10.3390/economies12070161 - 26 Jun 2024
Abstract
Debt is a fundamental component of modern economic systems. It serves as a source of financing for government, business, and individual projects. Many earlier studies concentrated on the direct relationship between debt and economic performance using different econometric methodologies. This work investigates the
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Debt is a fundamental component of modern economic systems. It serves as a source of financing for government, business, and individual projects. Many earlier studies concentrated on the direct relationship between debt and economic performance using different econometric methodologies. This work investigates the effect of debt on production efficiency, extracted from the estimated production function. Unlike previous econometric approaches, we employ a production stochastic frontier analysis (SFA) on data for 18 OECD countries spanning from Quarter 1, 2015, to Quarter 3, 2021, to capture the short-run effect of debt on the production efficiency and, thus, output growth. The results show that, in the short run, as debt increases by $1 billion, efficiency increases by 0.04%. Additionally, we found that the most indebted countries are the most efficient countries. In our sample, those were the UK and France. Furthermore, the average efficiency for the 18 OECD countries was 70.07.
Full article
(This article belongs to the Special Issue Dynamic Macroeconomics: Methods, Models and Analysis)
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Data Envelopment Analysis-Based Approach to Improving of the Budget Allocation System for Decarbonization Targets
by
Svetlana V. Ratner, Andrey V. Lychev and Vladimir E. Krivonozhko
Economies 2024, 12(7), 160; https://doi.org/10.3390/economies12070160 - 25 Jun 2024
Abstract
Energy innovation plays an important role in the transition to a zero-carbon economy. Governments in IEA member countries are investing in the R&D, demonstration, and deployment of new energy technologies as part of their energy and climate policies. However, government subsidies for energy
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Energy innovation plays an important role in the transition to a zero-carbon economy. Governments in IEA member countries are investing in the R&D, demonstration, and deployment of new energy technologies as part of their energy and climate policies. However, government subsidies for energy innovation are not always efficient in achieving climate policy goals. This paper proposes a two-stage Data Envelopment Analysis model with shared inputs to determine the optimal allocation of public funds for the energy innovation process. The innovation process is divided into two stages: the R&D stage and the commercialization stage. The inputs to the model (budget expenditures for energy innovations) are distributed between the first and second stages. As intermediate products, we use the number of patents in clean energy and hydrocarbon energy. The outputs of the model are the changes in carbon intensity and energy efficiency. This model can be used to assess the effectiveness of government spending on energy innovation. The results show that some IEA member countries should allocate a large part of the fossil fuel technology budget (more than 70%) to the research and development phase. The proposed model can support decision making at the international level to increase the effectiveness of public policies in achieving decarbonization and energy efficiency goals.
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(This article belongs to the Topic Energy Economics and Sustainable Development)
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Open AccessArticle
Impact of Firm-Specific and Macroeconomic Determinants on Environmental Expenditures: Empirical Evidence from Manufacturing Firms
by
Salim Bagadeem, Ayesha Siddiqui, Sapna Arora Narula, Najib H. S. Farhan and Muneer Ahmad Magry
Economies 2024, 12(7), 159; https://doi.org/10.3390/economies12070159 - 25 Jun 2024
Abstract
This research aims to examine the association between firm-specific and macroeconomic determinants and environmental expenditures in the Indian manufacturing sector. Furthermore, it seeks to investigate the moderation effect of country-level governance and economic development on the association between macroeconomic, firm-specific, and environmental expenditures.
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This research aims to examine the association between firm-specific and macroeconomic determinants and environmental expenditures in the Indian manufacturing sector. Furthermore, it seeks to investigate the moderation effect of country-level governance and economic development on the association between macroeconomic, firm-specific, and environmental expenditures. The current study is based on 70 manufacturing firms for the period of 2011 to 2021. The dependent variable is environmental expenditures and the independent variables are firm-specific and microeconomic determinants. The results revealed that market capitalization and firm size have a positive and significant impact on environmental expenditures. On the other hand, inflation and the rule of law negatively and significantly affect environmental expenditures. Regarding the moderation effect, the results revealed that the rule of law and GDP positively moderate the association between inflation and environmental expenditures. Hence, this research has significant implications for corporate executives, financial experts, regulators, and other interested parties.
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(This article belongs to the Section Growth, and Natural Resources (Environment + Agriculture))
Open AccessArticle
Map** EU Member States’ Quality of Life during COVID-19 Pandemic Crisis
by
Zacharias Dermatis, Charalampos Kalligosfyris, Eleni Kalamara and Athanasios Anastasiou
Economies 2024, 12(7), 158; https://doi.org/10.3390/economies12070158 - 24 Jun 2024
Abstract
This study proposes an integrated methodology for the assessment and map** of quality of life (QoL) among European Union member states in the period before and after the pandemic crisis of COVID-19. The assessment of quality of life was based on the development
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This study proposes an integrated methodology for the assessment and map** of quality of life (QoL) among European Union member states in the period before and after the pandemic crisis of COVID-19. The assessment of quality of life was based on the development of composite criteria and Geographical Information Systems or GIS technology, using variables that assess quality of life. The composite criteria relate to the socioeconomic environment, employment conditions, economic conditions and health services. Each criterion was evaluated by a set of variables, and each variable was weighted based on relevant research by Greek experts. Criteria were also weighted and combined to assess overall quality of life. The methodology was applied in 27 EU member countries, and map** led to the identification of countries with low and high quality of life. The results showed a change in the level of overall quality of life in the EU countries before and after the pandemic period, although on a limited scale, since there is a slight reclassification of the countries’ positions. The analysis also revealed the highest level of quality of life in four EU countries [Sweden, Denmark, the Netherlands and Luxembourg] that show an increased GDP per capita, combining a low level of arrears and a low level of inability to make ends meet, whereas four countries showed the lowest level of quality of life [Greece, Bulgaria, Romania and Croatia] in both periods.
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(This article belongs to the Special Issue Economics after the COVID-19)
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The Tale of Two Economies: Inflationary Dynamics in the Euro Area and the US in the Context of Uncertainty
by
Stefan Collignon
Economies 2024, 12(7), 157; https://doi.org/10.3390/economies12070157 - 21 Jun 2024
Abstract
In recent years, the global economy has been hit by a sequence of severe shocks that affected the two largest economies, the USA and the Euro Area, severely. Uncertainties about the future abound. While the challenges are similar for both economies and the
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In recent years, the global economy has been hit by a sequence of severe shocks that affected the two largest economies, the USA and the Euro Area, severely. Uncertainties about the future abound. While the challenges are similar for both economies and the policy tools resemble each other, they apply to different economic landscapes. What can they learn from each other? This paper looks at the basic structural facts, the nature of uncertainty shocks, and the efficiency of policy tools in the two economies. The key to understanding recent developments is uncertainty. This paper argues that the channel through which uncertainty influences inflation, wage cost, and unemployment is the markup firms charge to cover their cost of capital. While the measurements of uncertainty are uncertain, adding a proxy for uncertainty can improve the estimates of the basic New Keynesian model. The Federal Reserve Bank has been more successful because it operates in a more integrated capital market. In the Euro Area, uncertainty is higher than in the US and this could make disinflation in Europe more painful in terms of unemployment.
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(This article belongs to the Special Issue The Political Economy of Money)
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Open AccessArticle
Peruvian Agro-Exports’ Competitiveness: An Assessment of the Export Development of Its Main Products
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Jose Carlos Montes Ninaquispe, Alberto Luis Pantaleón Santa María, Diego Alejandro Ludeña Jugo, William Teófilo Castro Muñoz, Juan Cesar Farias Rodriguez, Billy Heinrich Maco Elera and Kelly Cristina Vasquez Huatay
Economies 2024, 12(6), 156; https://doi.org/10.3390/economies12060156 - 20 Jun 2024
Abstract
This study analyzed the competitiveness of Peru’s exports of grapes, blueberries, avocados, and asparagus from 2019 to 2023. Data were obtained from the customs declarations of all exporting companies of the analyzed products, along with data from the International Trade Center. Competitiveness was
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This study analyzed the competitiveness of Peru’s exports of grapes, blueberries, avocados, and asparagus from 2019 to 2023. Data were obtained from the customs declarations of all exporting companies of the analyzed products, along with data from the International Trade Center. Competitiveness was measured using the absolute revealed comparative advantage (RCA) index. The results indicate notable growth in the exports of grapes and blueberries, while asparagus and avocados face challenges in market and exporter diversification. The RCA index suggests a strong and stable specialization in these products. This study concludes with specific recommendations for institutions such as Ministerio de Desarrollo Agrario y Riego (MIDAGRI), Comisión de Promoción del Perú para la Exportación y el Turismo (PROMPERÚ), Asociación de Exportadores (ADEX), and Instituto Nacional de Innovación Agraria (INIA), aimed at enhancing competitiveness through market diversification.
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(This article belongs to the Special Issue Economic Development in the Digital Economy Era)
Open AccessArticle
Impacts of Regional Integration and Market Liberalization on Bilateral Trade Balances of Selected East African Countries: Potential Implications of the African Continental Free Trade Area
by
Perez Onono, Francis Omondi and Alice Mwangangi
Economies 2024, 12(6), 155; https://doi.org/10.3390/economies12060155 - 19 Jun 2024
Abstract
This study examined the effect of free trade on intra-African bilateral trade balances for Kenya, Rwanda, Uganda, and Tanzania to assess the potential implications of the African Continental Free Trade area. The four countries have experienced persistent trade deficits. Whether free trade within
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This study examined the effect of free trade on intra-African bilateral trade balances for Kenya, Rwanda, Uganda, and Tanzania to assess the potential implications of the African Continental Free Trade area. The four countries have experienced persistent trade deficits. Whether free trade within Africa can improve the national trade balances, and the drivers of bilateral trade balances are important questions for policy and strategic programmes for the countries to make the most gains from free trade area. The econometric model estimated for each country is an extension of the standard Keynesian model of trade balance to include determinants of bilateral trade flows from the gravity model. Quantitative analysis using panel regression was augmented with qualitative data from interviews with trade policy experts and trade officials from various African countries and focus group discussions with small-scale cross-border traders at the Busia and Namanga border posts in East Africa. Findings show that complete tariff elimination on intra–African trade may not impact the bilateral trade balances of Kenya, Rwanda, and Tanzania but could improve bilateral trade balances for Uganda by 6 percent. Within the free trade areas, Uganda’s bilateral trade balances were higher within the Common Market for Eastern and Southern Africa but lower within the East African Community, than outside these areas. Kenya’s trade balances were lower in the Common Market for Eastern and Southern Africa, than otherwise. On the contrary, no significant difference in trade balances is established for the membership of Kenya, Rwanda, and Tanzania in the East African Community; Rwanda in the Common Market for Eastern and Southern Africa; and Tanzania in the Southern African Development Community, when compared to trade balances with non-members. The importance of macroeconomic factors is demonstrated by the increase in bilateral trade balances with higher relative price levels of trade partners; the reduction with increase in relative production and expenditure capacities of trade partners; and improvements following a depreciation of home currency for Tanzania and Uganda, yet a worsening of trade balances in Kenya. A lack of harmony in documents required for cross-border movements within the free trade areas is reported as counterproductive. All African countries should therefore fully implement protocols and cooperate in the harmonization of trade procedures for the free movement of people and goods across borders. Country policies and trade programmes should pursue increased productivity in the leading intra-African export sectors and diversify exports via foreign direct investment in strategic sectors to substitute imports from outside Africa; reduce costs of production; increase the quality of products; and improve transport infrastructure.
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(This article belongs to the Special Issue Foreign Direct Investment and Investment Policy 2.0)
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Examining Monetary Policy Measures and Their Impacts during and after the COVID Era: OECD Perspectives
by
Imalka Wasana Rathnayaka, Rasheda Khanam and Mohammad Mafizur Rahman
Economies 2024, 12(6), 154; https://doi.org/10.3390/economies12060154 - 18 Jun 2024
Abstract
Governments worldwide implemented various fiscal and monetary measures to address the adverse impacts of COVID-19 on their economies. The paper aims to examine the changes in the monetary policy measures due to COVID-19 and their impact on macroeconomic variables. To explore this relationship,
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Governments worldwide implemented various fiscal and monetary measures to address the adverse impacts of COVID-19 on their economies. The paper aims to examine the changes in the monetary policy measures due to COVID-19 and their impact on macroeconomic variables. To explore this relationship, this study utilizes fortnightly data from 2020 to 2023 on the OECD (Organisation for Economic Co-operation and Development) countries. The study employs a Panel Autoregressive Distributed Lag (ARDL) model to analyze the effects of the monetary policy responses of the OECD governments, and the obtained results reveal that within OECD countries, the prevailing trend of lower interest rate policies emerged during the pandemic. This policy approach yielded a dual effect: lowering both output growth and inflation rates, while concurrently exacerbating unemployment rates throughout the COVID-19 period. Consequently, it is clear that monetary policies have played a pivotal role in facilitating the recovery from a profound economic shock such as the COVID-19 pandemic. Given the significant economic repercussions of a pandemic and the crucial role that monetary policy plays in sustaining economic stability, the apparent lack of attention underscores the urgent necessity for additional discourse on this vital subject.
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(This article belongs to the Special Issue Economics after the COVID-19)
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Open AccessArticle
Urbanization and Health Expenditure: An Empirical Investigation from Households in Vietnam
by
Hang Thu Nguyen-Phung and Hai Le
Economies 2024, 12(6), 153; https://doi.org/10.3390/economies12060153 - 16 Jun 2024
Abstract
This study examines the effects of urbanization on household health expenditure. Using a unique bi-annually household-level dataset from 2012–2016 from Vietnam, we obtain key findings as follows. To mitigate possible endogeneity concerns, we utilize a two-stage least squares regression (2SLS) approach, employing the
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This study examines the effects of urbanization on household health expenditure. Using a unique bi-annually household-level dataset from 2012–2016 from Vietnam, we obtain key findings as follows. To mitigate possible endogeneity concerns, we utilize a two-stage least squares regression (2SLS) approach, employing the development of information and communication (ICT) infrastructure at the province level as an instrumental variable (IV). The key findings can be summarized as follows. First, urbanization significantly reduces Vietnamese households’ inpatient and outpatient health expenses. Second, the self-treatment expenses of households increase as the process of urbanization advances. In addition, we perform various robustness checks, encompassing different measures of urbanization, the use of lag of urbanization as an additional IV, and the plausible exogenous IV. The outcomes derived from these rigorous sensitivity analyses substantiate the reliability and consistency of our key results. Finally, we propose different ways to explain these results, including health insurance expenses and household income.
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(This article belongs to the Special Issue Regional Development: Opportunities and Constraints)
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Open AccessArticle
The Relationship between Credit Rating and Environmental, Social, and Governance Score in Banking
by
Dimitrios Vortelinos, Angeliki N. Menegaki and Spyros Alexiou
Economies 2024, 12(6), 152; https://doi.org/10.3390/economies12060152 - 15 Jun 2024
Abstract
The present paper investigates the relationship between stock prices, credit ratings, and ESG scores for banks internationally. First, it describes stock prices and ESG scores at an annual frequency, as well as stock price and credit risk at a daily frequency. The relationships
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The present paper investigates the relationship between stock prices, credit ratings, and ESG scores for banks internationally. First, it describes stock prices and ESG scores at an annual frequency, as well as stock price and credit risk at a daily frequency. The relationships between (a) stock price and credit rating returns with ESG score returns and (b) among ESG scores are examined by pairwise annual correlation, and daily correlations are examined between price and credit rating returns. Furthermore, Granger causality is used to examine the relationships between the following: (a) price and ESG score annual returns; (b) price and credit rating daily returns; and (c) total and pillar annual ESG scores. This study makes a significant contribution to the literature by providing a detailed temporal analysis using both annual and daily data frequencies, which is relatively rare in the field. There is evidence of statistically and empirically important relations in the form of pairwise correlations. The regressions reveal a low significance of few ESG score changes in explaining credit rating changes. A unique aspect of this paper is the comprehensive analysis of 16 granular ESG scores, including overall scores, pillar scores, and sub-scores, allowing for a multi-faceted understanding of how specific ESG factors impact financial metrics. We found evidence of the significance of COVID-19 in all research questions. Additionally, this paper highlights the impact of the COVID-19 pandemic on the relationships between ESG scores, credit ratings, and stock prices, offering timely insights into the heightened importance and volatility of ESG factors during crisis periods. Future research needs to shed more light on this relationship, however.
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(This article belongs to the Special Issue Economic Analysis and Policy before, during and after a Public Debt Crisis, a Pandemic and an Inflationary Outburst)
Open AccessArticle
Spatial Aspect of Global Value Chain in East Asia: How Ports and Airports Shape Industrial Clusters in East Asia
by
Satoru Kumagai
Economies 2024, 12(6), 151; https://doi.org/10.3390/economies12060151 - 14 Jun 2024
Abstract
This paper examines how geography matters for the location of industries in East Asia, employing regression analyses on a novel and comprehensive regional GDP dataset. This study examines how geography affects industrial location patterns, particularly the role of infrastructure, such as ports and
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This paper examines how geography matters for the location of industries in East Asia, employing regression analyses on a novel and comprehensive regional GDP dataset. This study examines how geography affects industrial location patterns, particularly the role of infrastructure, such as ports and airports. This paper analyzes the current economic geography of East Asia using the novel dataset. The regression analyses utilize location quotients as the dependent variable and incorporate explanatory variables, such as domestic/foreign market access, per capita income, population density, and distance-based dummies for ports and airports. The findings reveal that the determinants of industrial location differ significantly across industries. The relative importance of domestic versus foreign market access and proximity to ports and airports varies across sectors. The results imply that countries/regions cannot easily host industries of their choice, as different industries require distinct locational characteristics.
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(This article belongs to the Special Issue Industrial Clusters, Agglomeration and Economic Development)
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Open AccessReview
The Von Neumann–Morgenstern Curve and Bank Capital Adequacy Penalties—An Empirical Analysis
by
Thomas Draper and Stefano Cavagnetto
Economies 2024, 12(6), 150; https://doi.org/10.3390/economies12060150 - 13 Jun 2024
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The risk of lending money collected from savers is that it leaves banks liable to default with depositors if events (and hence repayment demands) become ‘abnormal’. Even though international and national regulation has been introduced to ensure that a certain level of capital
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The risk of lending money collected from savers is that it leaves banks liable to default with depositors if events (and hence repayment demands) become ‘abnormal’. Even though international and national regulation has been introduced to ensure that a certain level of capital is retained by banks, such regulation can be subverted. The current system of international regulation based on the Basel III agreements does not stipulate a standardised approach for inspection frequency or penalty magnitude. This leaves the potential for regulatory arbitrage. The scientific value of an analysis to optimise regulatory efficiency and reduce such arbitrage is therefore considerable. This work therefore assesses the results of the empirical testing of a model based on the Von Neumann–Morgenstern utility function and consequently proposes that this model be used as a basis for standardising capital adequacy limit infraction penalties on an international level to prevent regulatory arbitrage. A survey is undertaken in order to test the responses of participants on the level of penalty which would deter them from regulatory transgression under different theorised levels of profit and probability of discovery. Based on the responses of two distinct subject groups (‘bankers’ and ‘non-bankers’) in different scenarios of hypothetical capital adequacy violation, the Von Neumann–Morgenstern utility function is reviewed against empirical results and revealed to show a semi-strong correlation. Lastly, the analysis reveals the striking similarities of the two groups’ responses, posing regulatory implications for the industry.
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Open AccessArticle
Identifying the Frequency and Connectivity Dynamics of the US Economy
by
Mathias Schneid Tessmann, Marcelo De Oliveira Passos, Omar Barroso Khodr, Alexandre Vasconcelos Lima and Pedro Henrique Pontes Fontana
Economies 2024, 12(6), 149; https://doi.org/10.3390/economies12060149 - 12 Jun 2024
Abstract
This paper seeks to investigate the connectivity of the US economy through the dynamics of the transmission of volatility in sectoral indices. For this, we use daily asset data and two methodologies. The first creates a spillover index that measures market connectivity and
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This paper seeks to investigate the connectivity of the US economy through the dynamics of the transmission of volatility in sectoral indices. For this, we use daily asset data and two methodologies. The first creates a spillover index that measures market connectivity and the second partitions this index into different frequency bands that denote periods. We found results that show significant transmissions of volatility among the 64 analyzed assets. Notably, the DJIA, Wilshire 5000, and S&P 500 showed significant volatility and were the main drivers of volatility for the other sectors and indices. Results also indicated that sectors that transferred volatility were influenced by three key factors: periods of economic uncertainty, socioeconomic circumstances resulting from post-crisis events, and the impact of economic and financial news on market sentiment. Additionally, we found that global returns and price changes in market indices sent considerable volatility into commodity assets. Our results are potentially useful for investors, portfolio managers, financial economists, financial advisors, financial market regulators, and policymakers.
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(This article belongs to the Section Macroeconomics, Monetary Economics, and Financial Markets)
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Open AccessArticle
The Role of Public Incentives in Promoting Innovation: An Analysis of Recurrently Supported Companies
by
Cátia Rosário, Celeste Varum and Anabela Botelho
Economies 2024, 12(6), 148; https://doi.org/10.3390/economies12060148 - 12 Jun 2024
Abstract
This study delves into the intricate relationship between corporate innovation and public support, underscoring innovation’s vital role in driving economic growth and competitiveness. Recognizing the multifaceted nature of innovation, from product and process improvements to organizational and marketing innovations, we examine how specific
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This study delves into the intricate relationship between corporate innovation and public support, underscoring innovation’s vital role in driving economic growth and competitiveness. Recognizing the multifaceted nature of innovation, from product and process improvements to organizational and marketing innovations, we examine how specific business characteristics and sectoral specificities condition access to public research and development (R&D) support, both nationally and at the European level. We analyze data from five Community Innovation Survey (CIS) reports spanning from 2008 to 2018 using ordered logit models. This approach evaluates the likelihood of companies receiving recurring public support for R&D based on internal R&D investments, interinstitutional collaboration, employee qualifications, and sectoral attributes. The findings reveal that internal R&D investments and collaboration with other entities significantly increase the likelihood of a company receiving recurrent public support. Furthermore, companies in high-tech sectors are more prone to receive public assistance. However, the analysis of European support shows no widespread statistical significance of the considered variables, suggesting the influence of evolving funding policies and an imbalanced dependent variable distribution. We conclude that the ability to secure public R&D support is influenced by a mix of company-internal and -external factors, highlighting the need for comprehensive and adaptable innovation policies. This study’s limitations, including potential sample non-representativeness and the dynamics of funding policies, underscore the importance of further, more encompassing research.
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