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Our study examines the comparative impact of governance quality on the dynamic relationship between monetary policy rate, saving, and economic growth in emerging economies in sub‐Saharan African countries from 2005Q1 to 2022Q4. Using the Toda‐Yamamoto (TY) model, we found that governance quality influence on monetary policy rate is negative with adverse effect on investment‐growth while exerting positive influence on savings‐growth nexus in Nigeria but the contribution is quite appreciative and can be leverage on. Governance quality exert negative influence on monetary policy rate but with positive direction from investment and savings to growth in Egypt. The magnitude of the monetary policy rate, savings, investment is quite negligible in Egypt. For South Africa, governance quality exerts positive influence on monetary policy rate but failed to translate to positive effect on investment, savings to growth in South Africa. Although, the contribution of monetary policy rate, savings, investment to growth is significant in South Africa. Thus, enhancing institutional development to foster a more effective financial incentive system and seamless policy transmission is crucial to address the impact of governance quality on monetary policy outcomes and enable better macroeconomic interactions. [ABSTRACT FROM AUTHOR]

Imagined identity, which opens up a variety of future possibilities for language learners, has been theorized from seemingly incompatible psychological and sociological perspectives in applied linguistics. Researchers have thus appealed for a transdisciplinary theoretical combination of these perspectives for a more nuanced understanding of language learning in context. This article makes the case for a synergistic theoretical framework of investment and motivation to theorize the idiosyncratic relationship between individuals’ imagined identity and language learning behavior. Empirical findings from a multiple‐case study conducted in Yunnan, in the south‐western corner of China, are presented to demonstrate how this framework enables a nuanced analysis of individuals’ language learning. Findings suggest that the interconnectedness of imagined identity, motivation, and investment is informed by both learner agency and contexts. This paper proposes that learners’ development of imagined identities and ways of investing in learning could be individually different, even under similar circumstances, which indicates the need for personalized teaching to improve learning outcomes. This synergistic framework thus provides implications for pedagogical practices and a need for personalized teaching. [ABSTRACT FROM AUTHOR]

We argue that the 40‐year‐old Feldstein–Horioka "puzzle" should have never been labeled as such. We discuss two problems with the literature. First, we show that the series of investment and saving rates typically used in empirical exercises to test the Feldstein–Horioka thesis are not appropriate. The correct series to properly test it are not collected. Second, we show that the Feldstein–Horioka regression is not a model in the econometric sense, that is, an equation with a proper error term (a random variable). The reason is that by adding the capital account to their regression, one gets the accounting identity that relates the capital account, domestic investment, and domestic saving. This implies that the estimate of the coefficient of the saving rate in the Feldstein–Horioka regression can be thought of as a biased estimate of the same coefficient in the accounting identity, where it has a value of 1. Because the omitted variable is known, we call it pseudo bias. Given that this (pseudo) bias is known to be negative and less than 1 in absolute terms, it should come as no surprise that the Feldstein–Horioka regression yields a coefficient between 0 and 1. [ABSTRACT FROM AUTHOR]

We consider whether government bonds, through the term structure, or corporate bonds, through the default yield, provide predictive power for output, consumption and investment growth in the United States. Such predictive power will allow policy‐makers to use the information as a leading indicator for macroeconomic performance and will improve our understanding of the links between real and financial markets. Full sample results suggest that both interest rate series exhibit predictive power for each of the macroeconomic growth series. Time‐variation in the predictive coefficient reveals the waning influence of the term structure and the rising influence of the default yield. Forecast results, which are obtained from a rolling window approach, likewise suggest both series have information content for macroeconomic conditions, but there is a change in their relative strengths. These results may arise as interest rates have declined since the highs of the early to mid‐1980s thus reducing the information content of government yields, whereas corporate bonds respond more to investor views of macroeconomic risk, which affects a firm's ability to repay its debt. Furthermore, short‐term rates are largely held unprecedently low since the dotcom crash. [ABSTRACT FROM AUTHOR]

We show empirically that firms increase cash holdings starting as early as one year before prescheduled (i.e., predictable) elections. Then, for four quarters around elections when uncertainty and external financing costs are high, firms decrease investment and draw down saved cash balances to avoid tapping external financing. We use a dynamic model of firm investment and saving to demonstrate the importance of anticipation of future financing costs to firms' pre‐election precautionary saving behavior. Theoretically, if election uncertainty were only to affect potential investment, lower firm investment would result in higher contemporaneous cash balances, which is inconsistent with our empirical results. [ABSTRACT FROM AUTHOR]

In this study, we discuss on the dynamic pricing and investment strategy for fashion products which decay in value, such as fashion clothes. The products are sold by an enterprise under a monopoly market in a finite horizon. Due to the obsolescence of fashion products, their fashion level decreases over time. Obviously, the selling price has a negative effect on demand, while the fashion level has a positive effect. Moreover, we introduce a reference value, which is used to indicate consumers' requirements for fashion level. We assume that investment on products performance or goodwill can reduce consumers' requirements for fashion level, an optimal control model is established. To maximize the enterprise's total profit, we obtain the trajectories of the optimal pricing and investment strategy by utilizing the Pontryagin's maximum principle. The optimal strategy is to gradually lower the selling price and then slightly raise it at the end of the sales period and reduce investment as products become obsolete. Afterwards, we provide a numerical example to illustrate our conclusions. Through the sensitivity analysis of the main parameters, we capture the influence of the parameters on an optimal decision. Moreover, some management implications are given. [ABSTRACT FROM AUTHOR]

Intangible capital is a key input to production that is distinct from tangible capital. Most forms of tangible and intangible capital have observable, pecuniary values. Their complement is non‐marketed capital. This paper studies non‐marketed capital from the points of view of an investor contemplating investing in a project and of a manager running the project. At the point of investment, an apparent positive net present value is realized through the marshalling of non‐marketed capital. When capital is viewed all‐inclusively, a full accounting reveals that (1) optimally timing investment serves to maximize the value of the non‐marketed capital eventually associated with an investment project, (2) the "full" net present value at investment is zero, (3) the internal rate of return is identically equal to the external interest rate, (4) Tobin's q is identically equal to one, and (5) marginal analysis is inapplicable to non‐marketed capital and thus to all capital. [ABSTRACT FROM AUTHOR]

This study formulates a theoretical framework to shed light on why cash grants fail to increase parental investment in child education, and what can be done to address the issue. The paper asserts that consumption vulnerability, loss aversion, and information friction render lump‐sum cash grants ineffective. Redesigning interventions as demand‐side cost‐sharing schemes would nudge parents to buy educational materials for their children. [ABSTRACT FROM AUTHOR]

Australians are embracing new forms of digital finance products and services, which includes purchasing cryptocurrencies and non‐fungible tokens (NFTs). There has been an increase in investment scams associated with cryptocurrencies. In this article, we sought to understand from cryptocurrency and NFT investors, who is vulnerable and what vulnerabilities exist. We surveyed 745 Australians aged 18 and over who have purchased cryptocurrencies or NFTs. We used sociological perspectives of consumer vulnerability that focus on internal and external factors to analyse our findings. We found that both socioeconomic advantaged and disadvantaged Australians are vulnerable. The vulnerabilities include concerns over security, unsolicited advice, limited options for learning, and insufficient financial and IT literacy. The findings suggest that online financial education is needed from trusted independent sources to help combat scams and to keep Australians and their crypto assets safe. We recommend that more opportunities to educate individuals about alternative forms of financial products are offered in compulsory, vocational and higher education settings. [ABSTRACT FROM AUTHOR]

While corporate social responsibility (CSR) has played an increasingly important role in corporate decision‐making, the role of CSR disclosure in a firm's investment activities remains poorly understood. This study investigates the impact of CSR disclosure on mergers and acquisitions (M&As), which are pivotal investment activities. We find that firms disclosing voluntary CSR reports experience significantly stronger market reactions to M&A announcements than those that do not disclose such reports. Specifically, acquisitions by voluntary CSR disclosers achieve 1.2% higher returns upon acquisition announcements, leading to a substantial increase in shareholder value. Our findings are consistent across a series of robustness tests. Additional analyses suggest that the positive market reactions are especially tied to voluntary disclosures concerning the protection of employees and customers, and that the quality and financial materiality of voluntary CSR disclosures amplify positive market responses. We also find that voluntary CSR disclosers exhibit better long‐term post‐acquisition market and operational performance. Collectively, our findings suggest that voluntary CSR disclosures bolster acquisition returns by mitigating stakeholder resistance. Additionally, by leveraging the unique conditional CSR disclosure regulation in China and using a staggered DID design, we observe a diminished market reaction for acquirers following mandatory CSR disclosures. Overall, this research provides new insights into the contrasting effects of voluntary and mandatory CSR disclosures, emphasizing the vital role of effective stakeholder CSR communication in the success of M&As. [ABSTRACT FROM AUTHOR]

Using a dataset of listed Indian manufacturing firms for 2010–2020, the study examines their financial response to climate risks in the presence of banker‐directors. The results show that climate sensitivity and vulnerability exert a negative impact on firm leverage and cost whereas climate adaptation has relatively limited impact. These effects broadly resonate across firm ownership, although it differ across firm‐bank equity interlocks. The overall impact of these developments is manifest in a decline in investment. The findings suggest that policymakers need to be more responsive to firm‐bank interactions, as these can impact firm behavior and have real economic consequences. [ABSTRACT FROM AUTHOR]

Summary: Is the typical specification of the Euler equation for investment employed in dynamic stochastic general equilibrium (DSGE) models consistent with aggregate macro data? The answer is yes using state‐of‐the‐art econometric methods that are robust to weak instruments and exploit information in possible structural changes. Unfortunately, however, there is very little information about the values of the parameters in aggregate data because investment is unresponsive to changes in capital utilization and the real interest rate. Bayesian estimation using fully specified DSGE models is more accurate due to both informative priors and cross‐equation restrictions. [ABSTRACT FROM AUTHOR]

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Assessing the contribution of intangible investment to growth is a challenging and complex task for any country. However, it has become increasingly difficult to determine both the exact magnitude of economic performance and its composition in the case of the Irish economy. This is mainly due to the impact of certain distortionary transactions by a select number of multinationals operating in the Irish jurisdiction. In this paper, we address this issue by assessing, in a detailed manner, the contribution of intangible and tangible assets to the Irish growth story. We control for distortions in the official investment data series while also incorporating intangible assets that are not currently included in the National Accounts. Our results show that the observed unprecedented increase in the official intangible investment has a relatively minor contribution to the actual Irish labor productivity growth. Once the distortions are filtered out, Irish labor productivity growth is driven by tangible capital. More interestingly, non‐national accounts intangible capital has a sizeable pro‐cyclical impact on labor productivity growth. [ABSTRACT FROM AUTHOR]

Trade and investment are crucial drivers of economic growth. Successful execution of trade and investment policy can elevate a developing country to a sustained growth path and make it self‐reliant. Bangladesh implemented a trade liberalization policy in the 1980s, deviating much from its conservative trade policy. This article assesses the impacts of trade, investment in physical as well as human capital, and a few trade policy variables on income surge for the liberalized regime. The econometric analysis finds that export, import, and domestic investment stimulate income. The impact of foreign investment is not conducive. Public spending on education also contributes to the income surge. Among the policy variables, trade openness and currency depreciation produce a beneficial impact. Population growth retards economic growth. The baseline results hold in the estimations involving several specifications of variables and testified as robust. The article views that a comprehensive approach to trade and investment policy would ensure the comparative advantage of trade and the well‐being of Bangladesh. [ABSTRACT FROM AUTHOR]

This study examines the published estimates on the relationship between economic freedom, as measured by the Economic Freedom of the World (EFW) index, and measures of growth, income, investment, and inequality. We obtained 696 point estimates for economic freedom‐growth from 54 articles, 386 estimates for economic freedom‐income from 23 articles, 343 estimates for economic freedom‐investment from 32 articles, and 759 estimates for economic freedom‐inequality from 26 articles. The published estimates support the view that economic freedom is positively related to growth, income, and investment. The level of economic freedom appears to be simply unrelated to inequality, though increases in economic freedom may correlate with higher inequality. [ABSTRACT FROM AUTHOR]

The effect of illicit financial flows (IFFs) on macroeconomic performance has been subjected to debates in the academic and policy arena, albeit with little evidence on its investment effect. This study contributes to the IFF‐investment literature by focusing on the four economic regions in Sub‐Saharan Africa (SSA), where IFFs have been growing consistently. The Pooled Mean Group (PMG) and panel dynamic ordinary least square (DOLS) estimators were utilized to analyse data for the period, 2008–2020. The result signalled inter‐connection among Sub‐Saharan African countries and affirmed the existence of a long‐run relationship among the variables considered. The empirical findings showed that IFFs crowd‐out domestic investment among the four SSA economic regions in the short and long time dimensions. This study, therefore, advocates for synergy among the stakeholders in each economic region to devise deliberate strategies to fight against the menace of IFFs toward successfully achieving Sustainable Development Goals by 2030. [ABSTRACT FROM AUTHOR]

Employees are commonly defaulted into either a homogeneous passive investment such as a target‐date fund, or into a managed account that offers personalization and access to an advisor. Higher performance among investors in target‐date funds suggests a possible behavioral benefit of a passive default that requires no active monitoring by investors. Access to a human advisor and an asset allocation matched to employee risk preferences can also help investors avoid trading after a market decline. This paper explores the relationship between trading activity and advice‐seeking behavior among 5 million US DC participants during the COVID‐19 pandemic, comparing self‐directors and target‐date fund investors to those using managed accounts service. We find participants who use target‐date funds are less likely to phone during a market crash. Participants in managed accounts are the least likely to trade after seeking advice. These findings are consistent with the hypothesis that passive default can improve outcomes where active choice can harm outcomes, and personalized defaults with access to advice can help participants avoid investment mistakes. [ABSTRACT FROM AUTHOR]

The article discusses the economic power and societal undervaluation of nursing. It highlights the significant role that nursing plays in healthcare, with nurses making up 54% of all health professionals in Australia and being essential to modern healthcare. Access to high-quality healthcare has economic implications and investing in nursing roles can improve clinical outcomes and bring additional economic benefits. However, nurses often face financial constraints and lower wage increases compared to other healthcare providers. The article emphasizes the urgent need for increased resourcing for primary care nursing and the importance of recognizing the economic potential of nursing for sustainable development and social equity. [Extracted from the article]

Studies informed by poststructuralist theories of language have examined the relationship between language teachers' emotion labor, identity, and agency. However, research has not yet explored the relationship between emotion labor and volunteer teaching, which is an important practice in language education. Our research seeks to address this gap, drawing on a 2‐year qualitative case study at the community‐based Vancouver Bangla School (VBS). With emotion labor and investment as the conceptual underpinnings, our study investigated how the VBS heritage language (HL) program structured the emotion labor of seven volunteer teachers, what the feeling rules associated with the VBS program were, and the extent to which volunteer teachers' investment in HL education helped them manage their emotion labor. Data sources included participant classroom observations, field notes, focus group and interview transcripts, questionnaires, and educational resources, which were analyzed using reflexive thematic analysis. Findings indicate that the emotion labor of volunteer teachers was structured by the following characteristics of the VBS program: lack of funding, poor organizational structure and teacher recognition, challenges of online teaching, insufficient number of teachers, limited parental support, and lack of training. This emotion labor was associated with four feeling rules implicit in the VBS program: (a) be generous and caring, (b) be committed and dedicated, (c) be a good and efficient teacher, and (d) have limited expectations of the community. Findings suggest that teachers' investment in Bangla as a mother tongue in multicultural Canada, and their investment in promoting the children's transcultural identities, was particularly powerful, and enabled the volunteer teachers to navigate and manage their emotion labor. The study suggests that an enhanced understanding of a language teacher's investment in a program, institution, or community might provide insight into the important relationship among desire, agency, and emotion labor. [ABSTRACT FROM AUTHOR]

In this paper we take a novel approach to examining the trade imbalances between the Southern Eurozone countries and the Northern Eurozone countries by aggregating them into a Southern Group and Northern Group. We then explore three possible causes of the trade imbalances, which are the fiscal channel, the investment channel and the competitiveness channel. We find that all three channels are important in explaining the emergence and correction of trade imbalances. In particular, we find that an increase in fiscal deficits in the North are twice as effective in reducing trade imbalances than fiscal consolidation in the South. By contrast, increased investment in the North has a similar impact to reduced investment in the South in correcting the trade imbalances. Finally, we find that a depreciation of the South's real exchange rate is associated with a long run deterioration in the Southern Group's trade balance suggesting that the South needs to seek non‐price competitiveness channels to address its trade imbalances. [ABSTRACT FROM AUTHOR]

We examine the link between investment and leverage internationally, bringing evidence from 22 emerging economies. We show a negative effect of leverage on investment that becomes stronger for low growth firms, in line with the overinvestment hypothesis. We further find that the monitoring effect of leverage on investment is stronger on firms operating in low regulatory quality and corrupt environments. Finally, we show that the monitoring effect induced by ownership concentration complements the monitoring effect of leverage on investment. Overall, our results suggest that the increased debt levels reported in emerging markets in recent years, act as a disciplinary tool against overinvestment, especially in countries with weak institutional environments. [ABSTRACT FROM AUTHOR]

Cooperative intelligent transport systems (C‐ITS) deployments for vehicle‐to‐infrastructure communication require substantial investments from European Member States in road‐side units (RSUs) and in central traffic management systems. The promise of numerous societal benefits should justify these public investments. However, C‐ITS uptake in passenger cars, and thus the subsequent societal benefits, are highly uncertain. Therefore, here, a case study of Flanders is presented in which real option analysis) is used to help road authorities assess the RSU investment opportunity. The framework combines a detailed cost and benefit model and includes managerial options for the road authority. This technique aims to incorporate the value of the flexibility that is available during the deployment to reduce risk exposure, and as such more accurately appraise the investment. C‐ITS uptake in passenger cars was modelled as the major source of uncertainty, as it is the primary driver of societal benefits. While a static RSU investment analysis for Flanders, Belgium, was found to be negative, embedding the option to defer the investment decision to further study C‐ITS uptake results in a positive average net present value. The results are useful for any road authority aspiring to roll out C‐ITS road‐side infrastructure. [ABSTRACT FROM AUTHOR]

We study the investment incentives created by truthful mechanisms that allocate resources using approximation algorithms. Some approximation algorithms guarantee nearly 100% of the optimal welfare in the allocation problem but guarantee nothing when accounting for investment incentives. An algorithm's allocative and investment guarantees coincide if and only if its confirming negative externalities are sufficiently small. We introduce fast approximation algorithms for the knapsack problem that have no confirming negative externalities and guarantees close to 100% for both allocation and investment. [ABSTRACT FROM AUTHOR]

This paper estimates the effect of the Organic Law for Productive Development, Attraction of Investments, Generation of Employment and Stability and Fiscal Balance on new investment and employment applied in August 2018 in Ecuador. Using event study designs and difference‐in‐ differences models, I find that the policy implementation does not have an effect on the attraction of new investments or the creation of new employment for prioritised sectors compared to non‐prioritised sectors. This matters from a policy perspective in a country with few private investments and a high share of people out of formal employment. [ABSTRACT FROM AUTHOR]

Organisms trade‐off limited resources between life‐history traits to maximize fitness. In particular, costs associated with reproduction are balanced against somatic maintenance and this can result in age‐dependent changes in the optimal allocation of resource to reproduction. Changes in the allocation of resources to reproduction with age were considered in the facultatively parasitic blowfly Lucilia sericata (Diptera: Calliphoridae), using biochemical analysis of lipids in the body and ovary, and lipid and protein in individual eggs. Resource allocation to reproduction, measured as lipid content in the ovary, declined over time. This decline was associated with the production of fewer and smaller eggs per batch. The lipid content of the residual body did not change. A decrease in lipid and increase in protein contents of individual eggs over time, although statistically significant, were relatively slight, suggesting that age‐related changes in nutritional allocation to individual eggs were more subtle than changes in egg batch number or size. This study highlights the insights to be gained from considering both biochemical measures of nutritional allocation, and observable measures of reproductive effort, when evaluating how females balance allocation across competing life‐history traits. Future work should explore how allocation patterns might vary under conditions of resource constraint and whether age‐dependent allocation in laboratory flies is representative of that found in wild populations. [ABSTRACT FROM AUTHOR]

Aspirations influence future‐oriented behavior and ensuing outcomes but they may also fail to do so when the aspired‐to‐status is far away from the current one. Theoretical predictions suggest an inverted U‐shaped relationship between this aspiration gap and the effort to achieve what is aspired to. Aspirations that are ahead but not too far ahead of the current status serve as the best incentives for investments. We examine the income aspiration gap of smallholder households and relate it to livestock in a pastoral setting in Northern Kenya. Our focus on livestock is guided by the burgeoning recognition of livestock as an investment and saving conduit for many households in pastoral communities in developing nations. Employing different empirical strategies including parametric and semi‐parametric techniques, we find livestock to be increasing with aspirations up to a threshold, from which it then declines to lead to an aspiration failure. Delving into livestock heterogeneity, we uncover evidence that cattle and poultry respond more to the aspiration gap than small ruminants such as sheep and goats. Different U‐shaped tests confirm this relationship, bolstering the evidence of an aspiration failure. These findings are robust to the inclusion of relevant controls, truncations at zero, and different variable transformations. We also show that the findings are unlikely to be driven by unobserved heterogeneity. Additionally, we find that internal locus of control, that is the degree to which individuals believe they control outcomes in their lives is associated with livestock investments. [ABSTRACT FROM AUTHOR]

China has many state‐owned enterprises (SOEs) and they have accounted for a large proportion of China's GDP over the last four decades. China's rapid growth contradicts literature that focuses on the inefficiency of SOEs. This study shows that, in periods of economic policy uncertainty (EPU), SOEs have performed a special function as "macroeconomic stabilizers." Using Chinese listed firm data from 2008 to 2019, we investigate five aspects of SOEs' unique functions as macroeconomic stabilizers: employment, investment, growth, financial operation, and expectations. When EPU increased, SOEs had more employment, higher investment expenditure, lower performance volatility, more robust financial structures, and more stable expectations than private firms. We employ the US–China trade war as an exogenous shock on EPU to conduct a difference‐in‐difference‐in‐differences approach to mitigate the problem of potentially omitted variables. The findings of this study provide a new perspective to better explain the functions of SOEs in the 21st century. [ABSTRACT FROM AUTHOR]

We study corporate investments around national elections in India. Investment rates drop by a nonsignificant 2.2% for state‐owned enterprises (SOEs) in election years. The decrease is significantly larger for private firms, which record an investment drop of 7.4%. The decrease in investment for private firms is likely attributable to political uncertainty. SOEs balance political uncertainty with the desire to woo voters who want government investments. Investments in election years are perceived positively for both private firms and for SOEs. Increased investment by SOEs and reduction in investment by private firms during election years are associated with improved investment efficiency. [ABSTRACT FROM AUTHOR]

This study examines whether and when Edgeworth's taxation paradox, that taxation decreases the equilibrium price, occurs in a free‐entry Cournot oligopoly with cost‐reducing investment. In contrast to the fact that no paradox occurs in the short‐run equilibrium, the paradox can occur in the long‐run equilibrium, in which the number of firms is endogenous. However, the conditions under which the paradox occurs are restrictive when there is no investment. By incorporating cost‐reducing investments into the model, we demonstrate that the paradox is likely to occur under less restrictive conditions, irrespective of whether the tax is specific or ad valorem. [ABSTRACT FROM AUTHOR]

This article presents an optimization methodology to schedule the replacement of power transformers (PT) into a fleet. The objective is the minimization of the summation of the risk indices of the PT. Each PT risk index is calculated from the estimation of the life used and the strategic importance of the unit. The PT life used is estimated as a relationship of the solid insulation polymerization degree, where aging processes due to oxidation, hydrolysis, and pyrolysis are considered from the calendar date when the unit starts its operation until different future scenarios. For the calculation of the PT strategic importance, financial, security, environmental, and network performance aspects are considered. Then, using the optimization model, together with the CAPEX and the available budget over a planning time, a strategy for optimally replacing the critical units is determined. The model was applied for a group of 102 units, demonstrating its applicability and effectiveness. The developed methodology serves to support the manager of these assets in making decisions in the long term. [ABSTRACT FROM AUTHOR]

Several studies have pointed out that manufacturing wages are relatively higher in African countries than in other countries at similar levels of development, and that this contributes to the continent's lower levels of manufacturing competitiveness. This paper derives unit labor costs (ULCs)—average wages relative to productivity—for two‐digit manufacturing sectors across a sample of 79 developed and developing countries, including 13 African countries, over the 1990–2015 period. We benchmark the ULCs to China and estimate the relationship between relative ULCs and manufacturing sector investment rates and export performance. We find that relative ULCs have a smaller association with exports in Africa relative to other developing regions. There is some evidence that investment responds to changes in relative ULCs in Africa; however, the estimated effects are smaller than in the full sample. Further, we find that for Africa, the level of labor productivity has a quantitatively stronger and more robust association with manufacturing performance than the level of real wages. The results have important implications for industrial policy in African countries. [ABSTRACT FROM AUTHOR]

We estimate the medium‐term relationship between investment and unemployment over the period 1960–2017 in 20 OECD countries, a period that includes the years of the Great Recession. While neoclassical growth theory typically assumes full employment—with no effect of investment on unemployment—and New‐Keynesian models assume that such a relationship only exists in the short term at business cycle frequencies, we find that over our sample period covering more than 5 decades, a statistically significant negative relationship does exist: in decades when investment fell, unemployment increased. Panel estimation, using a measure of stock market volatility as an instrument for investment, confirms the negative relationship between investment and unemployment. High stock market volatility and low investment are associated with high unemployment, other things equal. The evidence supports both Keynes' ideas about an unemployment equilibrium as well as more recent investment‐based theories of the natural rate of unemployment. [ABSTRACT FROM AUTHOR]

The illiquidity status of financial institutions widens up the financial stability gap, hence affecting other economic agents that depend on the financial sector. The objective of the study is to determine how the financial stability gap affects private investment in sub‐Saharan Africa (SSA). Annual time series secondary data from 33 SSA countries for the period 2007–2018 was used. Using the general methods of moments (GMM) estimation technique, we found that the financial stability gap beyond 109.9% becomes detrimental to private sector investment while government effectiveness and investment by the government improve private investment. The study recommends that financial institutions undertake liquidity protection measures as a means of protecting the stability status, while SSA governments invest in the economy and provide the needed business environment for private sector investment. [ABSTRACT FROM AUTHOR]

This study assessed the link between ease of doing business (EBD) and investment among 11 selected countries in West Africa covering 2006–2020. The study used the fixed‐effects estimator, the random‐effects estimator, the augmented mean‐group method, and the Half‐Panel Jackknife Wald‐type test. The study found a bidirectional relationship between the EBD and foreign direct investment (FDI) and a unidirectional relationship running from EBD to domestic investment. The findings further revealed that the EBD and national income have a strong influence in determining the level of domestic investment and FDI inflows, and that some indicators of EBD, such as the procedure for starting a business, access to credit facilities, tax, and security threats, discourage domestic investment and FDI inflows, in contrast to the influence of obtaining electricity and national income on investment. The study suggests that West African governments reduce taxes, ease the procedures and costs of starting a business and dealing with construction permits, and increase the availability of credit facilities at lower interest rates to promote investment in the region. [ABSTRACT FROM AUTHOR]

The ratio of trade to GDP is often used as a summary measure of a country's openness to the rest of the world. It is well‐known that the trade–GDP ratio is affected by relatively time‐invariant factors, such as country size and remoteness from trading partners, that can largely be controlled for in cross‐country panels by using country fixed effects. It is shown here that there are also other important, time‐varying influences on the trade‐GDP ratio that have been little investigated, such as the prices of commodity exports and imports, the real effective exchange rate, and the ratio of investment to GDP. These factors are shown to be significant, and not only in the short run, and need to be taken into account in estimating the long‐run effects of transport costs or trade policy on the trade/GDP ratio. [ABSTRACT FROM AUTHOR]

Premise: Plant ecological strategies are often defined by the integration of underlying traits related to resource acquisition, allocation, and growth. Correlations between key traits across diverse plants suggest that variation in plant ecological strategies is largely driven by a fast–slow continuum of plant economics. However, trait correlations may not be constant through the life of a leaf, and it is still poorly understood how trait function varies over time in long‐lived leaves. Methods: Here, we compared trait correlations related to resource acquisition and allocation across three different mature frond age cohorts in a tropical fern species, Saccoloma inaequale. Results: Fronds exhibited high initial investments of nitrogen and carbon, but with declining return in photosynthetic capacity after the first year. In the youngest fronds, we found water‐use efficiency to be significantly lower than in the oldest mature fronds due to increased transpiration rates. Our data suggest that middle‐aged fronds are more efficient relative to younger, less water‐use efficient fronds and that older fronds exhibit greater nitrogen investments without higher photosynthetic return. In addition, several trait correlations expected under the leaf economics spectrum (LES) do not hold within this species, and some trait correlations only appear in fronds of a specific developmental age. Conclusions: These findings contextualize the relationship between traits and leaf developmental age with those predicted to underlie plant ecological strategy and the LES and are among the first pieces of evidence for when relative physiological trait efficiency is maximized in a tropical fern species. [ABSTRACT FROM AUTHOR]

This paper examines how intermittent trade conflicts affect production, investment and exports of an industry that produces for both domestic and international markets. We construct a dynamic stochastic model of a representative profit maximising firm that is exposed to intermittent trade conflicts. We then extend the firm‐level model to an industry comprising a continuum of firms with heterogeneous production costs and calibrate its parameters to reflect the stylised facts of Chinese manufacturers between 2005 and 2007. We find that an exporting firm's response to the eruption of a trade conflict depends critically on its cost of production, with low‐cost firms temporarily adjusting production but continuing to export, and high‐cost firms permanently exiting the international market. We also find that an industry can respond quickly to the onset and cessation of a trade conflict. We further predict that in the long run, the severity of trade conflicts has increasing marginal impacts on industry exports, whereas the duration and frequency of conflicts have diminishing marginal impacts. Lastly, we argue that if the government desires to fully restore industry exports or value to pre‐conflict levels, the most efficient policy is to subsidise capital investment. [ABSTRACT FROM AUTHOR]

We study the driving forces behind the positive association observed between corporate investment and stock market valuation, and how they interact with managerial equity incentives and informativeness of investment. We build a dynamic model where managers use investment choices to influence investors' opinions about firms' future prospects and increase the market valuation. The incentives to manipulate the valuation processes increase with managerial equity incentives and informativeness of investment. Our empirical findings support the model's predictions that the tendency of using investment to boost market valuation is stronger when managerial stock ownership is high or when earnings quality is low (i.e., there is strong reliance on investment for information). [ABSTRACT FROM AUTHOR]

The aim of this study is to examine the impact of political connection on the cost of debt, the cost of equity and the investment level in an unstable political environment. We use a sample of 55 Tunisian listed firms during the post‐revolution period (2011–2018) and we apply a generalized least square (GLS) approach to test our hypotheses. Findings highlight that political connections increase the corporate financial costs and reduce the investment level. Furthermore, in an additional analysis, we show on the one hand that political instability negatively affects the investment and affects positively the cost of debt and the cost of equity. On the other hand, we make evidence that the political instability level negatively affects the relation between the political connection and the cost of debt. The contribution is, to the best of our knowledge, the absence of studies conducted in Tunisia countries examining the impact of political connection on the financial cost and investment level in an unstable political environment such as Tunisia. [ABSTRACT FROM AUTHOR]

The infrastructure sector is one of the major pillars for economic growth and development of a country. The responsibility to develop this crucial sector is shifting away from the public to the private sector. After the economic liberalization in 1991, India opened the infrastructure sector, among many others, to private domestic and foreign investment. The shortage of electricity, the poor state of roads, and limited telecom access necessitated a stream of persistent reforms, which were expected to play a significant role in the infrastructure sector's growth. Although some subsectors witnessed success, others continued to face hurdles. The paper highlights the role of infrastructure in socio‐economic development through global literature. It also presents a story of infrastructure development in India since the inception of economic liberalization. It highlights various challenges that discourage private sector investments, thus providing a rationale for policy initiatives by the government. The paper also presents critical issues highlighted by multiple government committees over nearly three decades and identifies residual issues that merit attention. The outcomes of the paper are relevant in the context of developing and emerging economies. [ABSTRACT FROM AUTHOR]

This article aims to refine the Post Keynesian long run financial frontier models under an intermediate run called the 'implementation period,' the time horizon to finance and implement long run strategic plans. During this period, the availability of debt finance is crucial to bridge the time gap before future free cash flows validate the investment. Therefore, firms' long run investment plans may be modified or suspended during this time horizon subject to bankers' uncertainty perception and state of confidence, which constrain debt capacity and firms' investment decisions. Uncertainty and the measures to enhance confidence, such as banking convention, mimetic behaviours, and bankers' spontaneous optimism, are critical to determining the financial frontier because they affect the lending amount, tenor, and refinancing potential. The proposed model focussing on bankers' convention and susceptibility explains the volatile nature of the financial frontier, investment instability, downward sloping effective loan supply and credit rationing under new perspectives. [ABSTRACT FROM AUTHOR]

We extend an equilibrium business cycle/asset pricing model of production and capital accumulation by introducing wealth‐dependent time preferences. First, we find that the aggregate consumption is no longer proportional to the output and the consumption volatility is always lower than the volatility of output. Second, the expected real growth rate is increasing in the capital stock, which leads to a twin‐peak shape of the world wealth distribution as shown in the data. With respect to financial markets, we show that the equity risk premium is reduced by the endogenous discounting and exhibits a cyclical pattern, which depends on the capital stock. Finally, time‐varying discount rate leads to welfare improvement and the welfare gain is decreasing in the capital stock. [ABSTRACT FROM AUTHOR]

Sense of purpose, or feeling that one has personally meaningful goals and directions guiding them through life, consistently predicts a variety of desirable well‐being, health, and social outcomes. However, work has been limited with respect to evaluating it as a predictor and promoter of romantic relationships or how purpose may develop in these contexts. For instance, healthy romantic relationships could also help individuals develop and maintain a higher sense of purpose. With cross‐sectional evidence finding positive associations between sense of purpose and romantic relationship commitment and satisfaction, the current study expanded on past work by using longitudinal data with three months between two measurement occasions (Time 1: N = 2243; Time 2: N = 1284) to evaluate whether sense of purpose predicted relationship status over time and how changes in relationship quality and sense of purpose were associated. Results showed that a greater sense of purpose predicted maintaining a romantic relationship but did not predict later romantic relationship quality, although higher romantic relationship quality predicted an increase in sense of purpose. Findings are discussed regarding why people with a higher sense of purpose may be more likely to stay in relationships as well as the role that positive romantic relationships may play in helping maintain a higher sense of purpose. [ABSTRACT FROM AUTHOR]

This paper uses Labor Force Survey data for European countries to estimate national investment in data assets, where the asset boundary is extended beyond that for software and databases as currently defined in the System of National Accounts. We find that: (a) in 2011–2018, 1.4 percent of EU‐28 employment was engaged in the formation of (software and) data assets, with a mean growth rate of 5 percent per annum; (b) on average in 2011–2016, expanding the asset boundary raises the level of own‐account GFCF in software and databases in the EU‐16 by 61 percent, and mean growth in real investment in own‐account software and data assets to 6.9 percent pa, compared to 2.7 percent pa in national accounts; (c) in 2011–2016, expansion of the asset boundary raises labor productivity growth in the EU‐13 from 0.79 percent to 0.83 percent pa, and the contribution of software and data capital deepening over three‐fold, from 0.03 percent to 0.10 percent pa. [ABSTRACT FROM AUTHOR]

Most of the studies on the impact of debt on Pakistan economy are backdated to a decade and hence the need to re‐investigate the impact to ascertain the level of effect is encouraged. To investigate the target research, the neoclassical growth equation was expanded by augmenting the equation with other variables of interest (Trade openness and FDI) with the intent of proffering solution in reviving the economy via policy implication. Pakistan's annual data of 1970–2016 were estimated with ARDL and Granger causality approaches for both short‐ and long‐run effects. The main variable external debt is negatively and significantly related to Pakistan's GDP both in the short and long run; Trade openness has a positive and significant impact on the GDP; FDI also has a negative and significant relationship with GDP in the short run but a positive and significant impact on GDP in the long run; and investment has a significantly positive impact on GDP in the short run. Basically from the findings, it is observed that the debt swelling is of hurting effect to the economy. The policy implication should be framed around encouraging the trade openness, but with care, as the first lag is depicting negative impact, FDI must be encouraged with an eye on its long‐term impact on the economy and finally, investment should be given maximum attention in order to crowd out the effect of external debt in the economy. [ABSTRACT FROM AUTHOR]

Innovation plays a vital role in driving Australia's economic growth, and the desire to quantify this relationship is ever present. This article quantifies the relationship between domestic gross expenditure on research and development (R&D) and gross domestic product (GDP) per capita growth to estimate the return on investment (ROI) to innovation for Australia. This article adopts the Jones and Summers (2020) approach to quantify the ROI of gross R&D spending for Australia. This novel yet simple macroeconomic approach complements other existing methodologies. It quantifies only economic benefits, excluding non‐monetary societal and environmental benefits. The baseline results state that $1 of R&D investment creates an average of $20.8 in economy‐wide benefits in today's dollars, and investment in R&D creates an average annual return of 104% for Australia. Importantly, this baseline result can be recalculated with adjustments to account for specific features of innovation activity. Incorporating a 10‐year delay between R&D and payoffs, combined with a correction for building R&D into new capital inputs (known as embodied capital deepening) to account for the additional time and costs associated with R&D expenditure yields lower results of $3.5 of economy‐wide benefits and 10% average annual return for every dollar spent on R&D. Even when corrections are applied to the baseline for conservative estimates, the economy‐wide returns to innovation are comparable to historical private investment returns in Australia. [ABSTRACT FROM AUTHOR]

This paper examines the net benefit accruing to a government when choosing between a lower tax rate on future profits and an investment subsidy as investment stimulation. We hypothesize that either the firm or the government faces Knightian uncertainty in contemplating investment. In the presence of the firm's Knightian uncertainty, the government prefers the investment cost subsidy to tax rate reduction as the conventional wisdom in prior literature. However, if the government is concerned about the model uncertainty, the optimal policy depends on the varying characteristics in reality, such as the ambiguity level, the growth rate, the volatility, as well as the interest rate environment. The tax rate cut is favorable when the growth rate, the discount rate, and the volatility are lower, and when the ambiguity parameter is higher. By taking into account Knightian uncertainty, we provide a potential rationale behind evaluating stimulus policies in different economic environments. [ABSTRACT FROM AUTHOR]

We consider the strategic incentives to invest in an environment where suppliers compete with nonexclusive contracts. When trade is nonexclusive, that is, the buyer relates with many suppliers simultaneously, the buyer's investment affects her outside option when excluding a supplier. The buyer's investment allows for cheaper substitution of the trade loss arising from the excluded supplier. In equilibrium, even though each supplier fully appropriates the investment return it receives in isolation, the buyer wants to invest to gain leverage over competing suppliers. Our model uncovers an essential role of nonexclusive contracts because they promote the buyer to invest. [ABSTRACT FROM AUTHOR]

Firms contract capital expenditure, reduce new debt issuance and face a higher cost of debt following the bankruptcy of an industry peer. The spillover effect declines with industrial distance and strengthens with the saliency of the bankruptcy. Furthermore, industries that are externally financially dependent are more vulnerable to the contagion effect. The investment contraction is not driven by industry asset reallocation, the presence of distressed firms or strategic competitive behavior by peers. We establish causality by identifying idiosyncratic bankruptcies and implementing an instrumental variable estimation to mitigate the confounding effect of general industry conditions. [ABSTRACT FROM AUTHOR]