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The Nexus Between Income and Foreign Direct Investment: Evidence from the Gambia
Issue:
Volume 9, Issue 1, June 2020
Pages:
1-9
Received:
24 June 2019
Accepted:
9 September 2019
Published:
4 January 2020
Abstract: The purpose of this study is to empirically examine the dynamic impact of the stock of foreign direct investment (FDI) inflows on the aggregate income of The Gambia. In order to find the dynamic nexus, the ARDL model was used to capture both short-run and the long-run impact of FDI inflows. The result shows that FDI has a negative impact on income in the short-run. The bounds testing for cointegration showed that there is a long-run level relationship between income and FDI inflows, and the impact of FDI inflows on income in the long-run is positive. In order to examine the possible reason why FDI inflows have a different impact in the short-run and the long-run, the study empirically investigates how the interaction of FDI inflows and domestic investment affects income. The results showed that in the short-run FDI inflows crowded-out domestic investment and this led to FDI inflows to have a negative impact on income in the short-run. Moreover, the results also showed that in the long-run the FDI inflows complemented domestic investment and this led to FDI inflows to have a positive impact on aggregate income in the long-run. The conclusion drawn from this study is that the net impact of FDI inflows on the aggregate income of The Gambia depends on the degree of complementarity and substitution between FDI inflows and domestic investment.
Abstract: The purpose of this study is to empirically examine the dynamic impact of the stock of foreign direct investment (FDI) inflows on the aggregate income of The Gambia. In order to find the dynamic nexus, the ARDL model was used to capture both short-run and the long-run impact of FDI inflows. The result shows that FDI has a negative impact on income ...
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Effects of Food Trade Liberalization on Poverty and Inequality in Bangladesh: A Partial Equilibrium Approach
Mohammad Mahbubur Rahman,
Cheng Fang
Issue:
Volume 9, Issue 1, June 2020
Pages:
10-19
Received:
3 October 2019
Accepted:
12 November 2019
Published:
6 January 2020
Abstract: Using a partial equilibrium model, we examine the effects of full tariffs withdrawal from food imports of Bangladesh on its poverty and inequality. We show that if tariffs are withdrawn from food imports, domestic food prices decrease, but the sizes of decreases in prices depend on import demand elasticities. Then we show that decreases in domestic prices affect households’ welfare or income in three channels. As consumers of food items, households gain real income/welfare as their food expenditures reduce. As laborers in the agriculture or food processing sector, households’ members may lose their income, as according to the Stolper-Samuelson theorem, changes in output prices may affect input prices positively. As sellers of food items, households lose their income. From Household Income and Expenditure Survey 2010, we find that the average effect of full tariffs withdrawal from food imports on households’ welfare is positive, as all households are consumers, but all are not laborers and sellers. So, the first channel is stronger than other channels. We have found that food trade liberalization reduces the poverty rate by 2.4 percentage points. However, the main food in Bangladesh is rice, which had no import tariff in our data period. We also produce results for rice trade liberalization. If the rice tariff were the highest ever (e.g., 19.4%) and the government reduced it to zero, the poverty rate would have decreased by 1.74 percentage points. Rice trade liberalization also reduces inequality, but trade liberalization of other foods does not influence inequality.
Abstract: Using a partial equilibrium model, we examine the effects of full tariffs withdrawal from food imports of Bangladesh on its poverty and inequality. We show that if tariffs are withdrawn from food imports, domestic food prices decrease, but the sizes of decreases in prices depend on import demand elasticities. Then we show that decreases in domestic...
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The Determinates of Export in Ethiopia, an Auto Regressive Distributive Lag Bound Test Approach
Issue:
Volume 9, Issue 1, June 2020
Pages:
20-26
Received:
4 September 2019
Accepted:
24 October 2019
Published:
7 January 2020
Abstract: This paper identified some of the main determinants of export in Ethiopia for the period 1977-2016 G. C. Also the paper tried to include new variable such like export diversification index and financial development as one determinant which are not considered in the most of the previous research conducted under this area, moreover the study used a bound test approach which is not used by previous research under this area. To test empirically the relationship between export performance and its major selected determinants such as: real gross domestic product, real effective exchange rate, financial development, export diversification index, terms of trade, total investment, trade openness and major trade partner GDP per capita i.e. China. The bound testing approach of co-integration and error correction model, within the Auto Regressive Distributive Lag Model frame work is developed. The estimated results show that all explanatory variables listed above significantly affect the export performance both in short run and long run except financial development and export diversification index. With sign of coefficients all determinates variable sign is consistent to economic theories. Finally the finding indicates that policy makers should give emphasis for the determinants factor of export. Also measures must be taken to reduce the constraints deterring the performance of the export sector through diversifying and promote exports by boosting domestic capital for exports, serving to transfer technology, new product for exports, making access to new and large foreign markets easily and improving technical and management skills and Lowering barriers to firm’s entry and reducing international trade cost.
Abstract: This paper identified some of the main determinants of export in Ethiopia for the period 1977-2016 G. C. Also the paper tried to include new variable such like export diversification index and financial development as one determinant which are not considered in the most of the previous research conducted under this area, moreover the study used a b...
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Role of Knowledge Acquisition on Firm Performance in the Context of Small and Medium Enterprises in Meru County, Kenya
Cosmus Muriithi Gatuyu,
Godfrey Muigai Kinyua
Issue:
Volume 9, Issue 1, June 2020
Pages:
27-32
Received:
14 November 2019
Accepted:
30 December 2019
Published:
7 January 2020
Abstract: Small and Medium Enterprises (SMEs) are touted as the silver bullet in the revival and flourish of any country’s economy. It has the capacity to gainfully engage the highest number of work force. Effective and efficient performance of the sector is critical to economic growth. Large amounts of resources allocated to the sector have borne little fruit with failure reports in the last decade. This paper seeks to establish the influence of knowledge acquisition strategies on the performance of Small and Medium Enterprises (SMEs) within Meru county. The study was based on three theories; The Resource Based View theory of the enterprise (RBV), Organisation Learning (OL) and Knowledge Based View (KBV) theories. The research study employed a descriptive survey research design. The study’s target population was 500 SMEs in Meru County from which a sample of 150 SMEs was selected using stratified random sampling. The SMEs in Meru County constituted the unit of analysis while the managers, proprietors and senior staff constituted the unit of observation. The researcher utilised questionnaires to collect primary data. The data collection instruments were tested for construct, content and face validity. Cronbach Alpha Coefficient was used to test for reliability. Descriptive and inferential data was analysed. Summary measures of the sample which included frequency distribution tables, percentages, standard deviations and mean was generated from the descriptive statistics. Multivariate analysis and inferences made at 95% confidence level included the inferential statistics. Owners of SMEs will find the study’s results effective in enhancing their entity performance as they can make viable business decisions based on acquired knowledge. Academicians, researchers and lay readers with an interest in knowledge acquisition will find the study useful. From the findings, SMEs in Meru County embraced knowledge acquisition strategies and practises to a moderate extent. The study concludes that the knowledge acquisition strategies had a significant positive effect on the performance of SMEs in Meru County. From the study findings, it can be concluded that there is a strong relationship between the study variables as shown by a correlation coefficient of 0.781. The study concludes that the SMEs have enhanced knowledge acquisition through use of capacity development, mentorship programs, modern technology and consultations. It is a recommendation of the study that the SMEs should embrace the trainings and microfinance services offered by Micro-Finance Institutions and other financial sector players to enhance their capacity in knowledge acquisition.
Abstract: Small and Medium Enterprises (SMEs) are touted as the silver bullet in the revival and flourish of any country’s economy. It has the capacity to gainfully engage the highest number of work force. Effective and efficient performance of the sector is critical to economic growth. Large amounts of resources allocated to the sector have borne little fru...
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Measurement of Regional Industrial Ecological Efficiency in China and an Analysis of Its Influencing Factors
Issue:
Volume 9, Issue 1, June 2020
Pages:
33-40
Received:
7 December 2019
Accepted:
16 December 2019
Published:
17 January 2020
Abstract: In recent years, with the rapid advancement of industrialization and urbanization, China's economy has experienced a period of rapid development. However, while China has become the world's second largest economy, it has also become a veritable resource consumer and environmental polluter. So China must need to transform its economic development model and vigorously promote ecological progress. We use interprovincial panel data from 2012 to 2016 to calculate and analyze the industrial ecological efficiency of 31 provinces in China, and then discuss the factors that influence efficiency. The results show that, during the research year, the industrial eco-efficiency of 31 provinces and municipalities in China has been rising steadily in time series but differs significantly in regional cross-sections. Moreover, the eco-efficiency of the eastern region was higher than the central and western regions. Among the influencing factors, the per capita GDP, the proportion of the secondary industry's output value to the regional GDP, and the population density all had a positive impact on industrial eco-efficiency, and the overall industrial eco-efficiency level of the eastern region is higher than the central and western regions. Therefore, the keys to improving regional industrial eco-efficiency are as follows: increasing the income of residents, accelerating the ecological transformation of traditional industries, optimizing the population lay out to alleviate the conflict between people and land, and narrowing the regional development gap.
Abstract: In recent years, with the rapid advancement of industrialization and urbanization, China's economy has experienced a period of rapid development. However, while China has become the world's second largest economy, it has also become a veritable resource consumer and environmental polluter. So China must need to transform its economic development mo...
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Foreign Aid Inflow and Domestic Savings in Uganda: Error Correction Modelling
Henry Tumwebaze Karamuriro,
Edward Patrick Ssemanda,
Edward Bbaale
Issue:
Volume 9, Issue 1, June 2020
Pages:
41-50
Received:
13 June 2019
Accepted:
23 July 2019
Published:
27 January 2020
Abstract: The study sought to establish the impact of foreign aid inflow on domestic savings in Uganda. It was motivated by the low savings ratio which was identified as one of the major constraints to future growth in Uganda, under Vision 2025. Error-Correction Modelling was applied on a time series database for the period 1970-2016. Results of the study show that foreign aid has a negative impact on domestic savings in Uganda both in the short-run and long-run. An increase in foreign aid inflow by 1% of GDP leads to 0.71% decrease in gross domestic savings in the long-run. This implies that an increase in foreign aid as a whole crowded-out domestic savings in the short-run and long-run. By making resources easily available, foreign aid encourages relaxation in saving effort and increases consumption. A policy implication of this result is that Uganda should be wary in soliciting for foreign aid. If foreign aid becomes expedient, then it should be channeled to productive ventures.
Abstract: The study sought to establish the impact of foreign aid inflow on domestic savings in Uganda. It was motivated by the low savings ratio which was identified as one of the major constraints to future growth in Uganda, under Vision 2025. Error-Correction Modelling was applied on a time series database for the period 1970-2016. Results of the study sh...
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Evolutionary Game Analysis of Campus Credit Strategy Selection Under Incomplete Information Conditions
Issue:
Volume 9, Issue 1, June 2020
Pages:
51-57
Received:
9 January 2020
Accepted:
31 January 2020
Published:
10 February 2020
Abstract: Since the China Banking Regulatory Commission issued relevant policies on standardizing the credit card business of college students in 2009, college students' credit cards have gradually withdrawn from campus loan business. In recent years, with the rapid development of the Internet, "Online campus loan" began to take the college student market as the goal, and quickly entered the university campus through recruiting student cadres to carry out "carpet" promotion activities inside the campus. And seized the current situation of college students' lack of financial knowledge and the psychology of comparative consumption, the business volume expands rapidly. The subsequent malignant events, such as "10g naked loan slip", "huge profits and fund-raising", "some college students jumping off buildings to commit suicide due to their inability to repay the loan", also have a negative impact on the society. In view of the above phenomena, this article combines existing research on existing problems of campus loans, and establishes an evolutionary game model between the campus online loan platform and college student borrowers from the perspective of evolutionary games. The game model has two stable points (1, 1), (0, 0), namely, the campus loan platform chooses to deceive the borrower, the borrower chooses to break the trust, and the campus loan platform chooses not to deceive the borrower, and the borrower keeps the trust. This paper discusses the influence of the changes of the relevant parameters in the model on the choice of the game strategy, and puts forward some suggestions to establish a two-way scoring mechanism for online lending, increase the financial knowledge reserve and income of college students, and help them establish a correct consumption view to standardize the campus online lending work.
Abstract: Since the China Banking Regulatory Commission issued relevant policies on standardizing the credit card business of college students in 2009, college students' credit cards have gradually withdrawn from campus loan business. In recent years, with the rapid development of the Internet, "Online campus loan" began to take the college student market as...
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Assessment on the Determinant and Impact of Coffee Production on House Hold Income (In Case of Anfilo Woreda)
Habtu Nibret,
Getnet Ayalew
Issue:
Volume 9, Issue 1, June 2020
Pages:
58-65
Received:
17 December 2019
Accepted:
14 February 2020
Published:
6 March 2020
Abstract: Coffee is increasingly becoming a part of Western culture, it is most likely that they will not think of the more than “25 million people around the world [that] base their livelihoods on its production”. Coffee is the major agricultural export crop, providing currently 35% of Ethiopia’s foreign exchange earnings. The coffee sub-sector is also important in terms of providing income for a large number of households. This study assessed the impact of coffee production and household income in Anfilo wereda Oromiya regional State. The study also investigated factors influencing coffee production and incomes of household. The study followed a multistage random sampling procedure. Data collected from 116 sample households was used in this study. Descriptive statistics were employed and logit model (logistic regression) was used to identify factors influencing coffee production and sample household income.
Abstract: Coffee is increasingly becoming a part of Western culture, it is most likely that they will not think of the more than “25 million people around the world [that] base their livelihoods on its production”. Coffee is the major agricultural export crop, providing currently 35% of Ethiopia’s foreign exchange earnings. The coffee sub-sector is also impo...
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Economic Growth in Nepal: Macroeconomic Determinants, Trends and Cross-Country Evidences
Luna Ghimire,
Ajay Kumar Shah,
Ram Kumar Phuyal
Issue:
Volume 9, Issue 1, June 2020
Pages:
66-72
Received:
24 February 2020
Accepted:
20 April 2020
Published:
19 May 2020
Abstract: Using time series data of the last twenty-seven years (1990 to 2016), this study tries to go in-depth regarding the relationship between macroeconomic variables and its impact on economic growth of Nepal. Further, this study also compares the economic growth of Nepal with six Asian countries such as Bangladesh, Bhutan, China, India, Pakistan and Sri Lanka. The study is based on secondary data which are extracted from a legitimate source of World Bank. The dependent variable of this study is Gross Domestic Product (GDP) growth (annual%). To observe the GDP growth, some independent variables like exchange rate, export of goods and services, Foreign Direct Investment (FDI) net flow, Gross Fixed Capital Formation (GFCF), import of goods and services and inflation are chosen. Based on the variables, statistical tools such as multiple linear regression, Karl Pearson's correlation, and trend analysis are run. As per the result, exchange rate, GFCF, and import have a significant impact on the economic growth of Nepal while export, FDI, and inflation do not have a significant impact. Further, the cross-country evidence shows that Bangladesh and India have a significant positive GDP growth trend, while Bhutan and Sri Lanka have a positive GDP growth trend but do not have a significant growth. Also, China, Nepal, and Pakistan do not have a significant growth and their growth trend is negative. Based on the results and analysis it is suggested that a strong exchange rate leads low cost of production with cheap imports and also helps to control inflation due to low prices of foreign goods and services. In this context, the policymaker should initiate to make tight policies against the reduction of inflation in the country.
Abstract: Using time series data of the last twenty-seven years (1990 to 2016), this study tries to go in-depth regarding the relationship between macroeconomic variables and its impact on economic growth of Nepal. Further, this study also compares the economic growth of Nepal with six Asian countries such as Bangladesh, Bhutan, China, India, Pakistan and Sr...
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