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Emerging and fastest-growing markets in Africa are developing their financial environment to attract investors and position themselves as an upcoming generation of strong and influential markets. The subject of this study is public expenditure outlays used to stimulate economic activity in emerging markets in Africa. The purpose of this study is to isolate the main determinants of government spending and the role of institutional quality. The relevance lies in the significance of maintaining such expenditures at optimal levels to benefit the economy. The scientific novelty lies in the analysis of the main factors explaining government spending to support policy formulation in emerging markets. This study applied the autoregressive distributed lag (ARDL) model to test both long-term and short-term dynamics. Based on the results, the study demonstrated both joint and long-run causality between the selected variables and government expenditure. Short-term causality is not confirmed. The study concluded that the Wagner law still holds, in which economic growth is coupled with an increase in expenditure. The Economic freedom index is more effective in controlling government expenditure than the POLITY 2 variable. This study offers some policy implications.

Abstract The relationship between external debt and economic growth has been extensively studied by researchers and policymakers. However, the link between external debt and domestic investment remains an underexplored area of research. Therefore, this paper investigates the nexus between external debt and domestic investment, using institutional quality as a moderator. The sample consists of 47 sub-Saharan African countries with data spanning from 1996 to 2021. The empirical findings from conventional and robust estimators indicate that external debt negatively and significantly hampers domestic investment, while institutional quality plays a significant moderating role in this relationship. Additionally, the benefits of debt can only be realized by the SSA region when the average quality of institutions is above − 1.174 on the scale of − 2.5 to 2.5. The in-depth analysis offers insights that high-quality institutions (above a certain threshold) can help countries leverage debt for positive outcomes by promoting efficient resource allocation and attracting further investment. Thus, policymakers are advised to uphold debt management strategies and institutional reforms, such as reducing corruption, improving property rights, and strengthening the rule of law, to ensure transparency in debt use and maintain a sustainable debt burden. This will create a more attractive environment for both domestic and foreign investment. The results remain robust to alternative methodologies.

Global warming has become a big problem around the world, and it is because of what people do. As a possible answer, countries are looking for ways to keep their economies growing and invest in technologies that use clean energy. Therefore, the notion of carbon neutrality has emerged as a crucial policy strategy for nations to attain sustainable development. This study expands the existing discussions on carbon neutrality by investigating the influence of key factors, including green innovation, financial development, natural resources depletion, trade openness, institutional quality, growth, and urbanization on the progress made towards attaining a carbon neutral state in the BRICS nations. This study considers the Method of Moment Quantile-Regression (MM-QR) and Prais–Winsten correlated panel corrected standard errors (PCSEs) estimators to investigate the study objectives over the period of 1990–2021. Under the investigated outcomes, this study validated the significant role of urbanization and growth in carbon neutrality. On the other hand, this study finds the positive role of openness, green innovation, resource depletion, institutional quality, and financial development on environmental deterioration. However, under a systematic analysis, this study utilizes different proxies of the financial sector, for instance, financial complexity, financial efficiency, financial stability, and domestic credit by financial sector, and provides interesting outcomes. Based on these outcomes, this study also provides suggestions to attain desired levels of sustainability. [ABSTRACT FROM AUTHOR]

This study investigates the multifaceted interactions among public health financing, institutions, and population health. It also sought to determine whether the efficacy of government health interventions to reduce child mortality and improve life expectancy in Africa's most populous country had been hampered by its institutional framework. The research analyzed the links among institutional, socioeconomic, and health variables using the autoregressive distributed lag estimator across a 37‐year period (1984–2020). The findings show that short‐term public health spending in Nigeria has a significant negative effect on health outcomes, whereas long‐term spending has a significant positive effect. Although public health financing significantly impacted long‐run life expectancy, its short‐run impact is statistically insignificant. Moreover, public health financing is positively linked with lower infant mortality in the long run but directly associated with higher rates in the short run. It further discovered that weak institutional framework is responsible for low life expectancy and high infant mortality. Institutions exert an unconditional significant negative impact on short‐ and long‐term health outcomes. Findings also show that both the short‐ and long‐term net effects of government health financing and institutions on the health outcomes are negative and statistically significant. So, institutions and public health financing are substitutes, with institutions unable to adequately improve their role in the public finance–health outcomes relations. Furthermore, the thresholds at which short‐ and long‐term institutional settings will modulate direct links between public finance and health outcomes are 5.01 and 2.62, respectively. Hence, the empirical findings validate the defective nature of the Nigerian institutional settings. Policy prescriptions for improving health outcomes are recommended based on the findings. [ABSTRACT FROM AUTHOR]

This study examines the relationship between foreign direct investment (FDI), institutional quality and human development) in host countries from 2002 to 2019, using the Human Development Index [HDI] as the measure of human development. This study utilized a panel dataset of 143 countries, including both developed and developing economies, over a 17-year period. Additionally, the study employed a GMM (generalized method of moments) estimator to address unobservable heterogeneity and simultaneity. This study reveals a significant positive relationship between FDI and human development, with a stronger effect observed in developing countries compared to in developed countries. Notably, the impact of FDI-HDI nexus is larger in countries with moderately high-quality institutions, irrespective of their income level. Furthermore, good governance plays a crucial role in enhancing human development, as developing economies with high governance quality experience a greater impact of FDI on HDI compared to other countries. The findings of this study suggest that attracting FDI can be beneficial for enhancing the HDI, especially in developing countries. Additionally, the study highlights governance as a moderating factor in the relationship between FDI and HDI. Improving governance quality can enhance the positive impact of FDI on human development in host countries, especially in developing countries. [ABSTRACT FROM AUTHOR]

[Display omitted] • Energy access and affordability play key roles in CFT adoption and environment. • Clean Fuel Tech. (CFT), climate change and R&D spending are positively linked. • Innovation reduces GHG/CO2 emissions; forests curb environmental damage. • Green innovation and institution quality negatively affect CFT. • Clean fuel tech and institutional quality moderately impact the environment. Energy access, affordability, and quality of institutions play an important role in adopting green technologies at the household level and facilitating the transition towards a sustainable future. This study examines environmental sustainability dynamics in 26 nations from 2001 to 2021 to emphasize Africa's ecological calamity. The study evaluates the individual and interactive effects of green technology adoption-innovation, institutional quality, and energy access on household clean fuels technologies (CFT) adoption and GHG emissions. The hypotheses are robustly tested using Feasible Generalized Least Squares (FGLS), Panel Corrected Standard Errors (PCSE), and Bootstrap Granger Causality is used for country-specific outcomes. The research revealed positive associations between CFT energy usage, climate change, and R&D expenditure but negative correlations with population and affordability. Innovation lowers GHG and CO2 emissions, and forests mitigate environmental damage. However, green innovation and institution quality (INIQ) negatively affect CFT. Meanwhile, the CTIQ reveals that adopting clean fuel technology and institutional quality has moderate environmental impacts. The study observed robust uni/bidirectional causality evidence in country-specific cases. The outcomes emphasize strategic investments in clean energy absorption, innovation, and institutional quality to promote sustainable environmental practices in African countries via customized green policies. [ABSTRACT FROM AUTHOR]

This study has explored the potential role of institutional quality and social inclusion in trust building. By utilizing the panel data spanning over thirty five years and for one hundred and twenty four countries of the world, we have applied Fixed Effects as well as Quintile Regression Models to explore the empirical relationship of our interest. The findings reveal that social inclusion is an important and key factor in trust building. The effects of social inclusion on trust are robust as the coefficient of social inclusion is positive and significant across all of our estimated models. Institutional quality also has positive and significant effects on trust building except at medial level of distribution of trust where it has positive but insignificant effect on trust. Income inequality has negative and significant effects whereas the effects of ethnolinguistic diversity on trust are contextual specific as these effects vary across different quintiles of trust distribution. Diversity has negative and significant effects on trust at 10th percentile and positive and significant effects at 90th percentile of trust distribution. Our findings are important for policymakers who can formulate strategies to foster inclusive environment which can be conducive to enhance trust in the society. [ABSTRACT FROM AUTHOR]

Copyright of International Journal of Professional Business Review (JPBReview) is the property of Open Access Publications LLC and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The development of renewable energy is considered as an important step toward sustainable development. In sub‐Saharan African (SSA) countries, institutional quality can play an essential role in encouraging investment and implementation of policies favoring renewable energy. This paper examines the role of institutional quality in the effect of renewable energy on economic growth across 25 SSA countries from 2002 to 2018. The results from the dynamic panel threshold model reveal a significant threshold effect of institutional quality on the contribution of renewable energy to economic growth. While renewable energy consumption positively contributes to economic growth, its impact is notably amplified when the institutional quality index, set at 0.304, is above the threshold. Our findings remain robust when altering institutional quality indicators. In terms of economic implications, improving overall institutional quality by promoting good political, economic, and institutional governance could significantly increase the contribution of renewable energies to economic growth in SSA countries. [ABSTRACT FROM AUTHOR]

This research paper focuses on figuring out the impact of trade openness on FDI inflows, which has received relatively less attention in the literature, specifically in the context of ASEAN economies. The ASEAN region, which is relatively more open in terms of both trade openness as well as FDI inflows, is chosen as a sample. Annual data are gathered from "World Development Indicators (WDI)" and "World Governance Indicators (WGI)". Reported results and findings are based on "Fixed Effect (FE) Modeling", and the "Generalized Least Square (GLS)" is utilized for the robustness check. The results indicated that trade openness matters significantly for attracting FDI inflows. Similarly, institutional quality has also exerted a positive and significant influence on the inflows of FDI. The disaggregated analysis shows that five aspects of institutional quality, such as rule of law, regulatory quality, control of corruption, voice and accountability, and political instability and absence of violence, have positively and significantly impacted the FDI inflows in the case of selected ASEAN economies. The results demonstrated that exchange rate depreciation is harmful for the inflows of FDI. Moreover, FDI inflows responded positively to market size. Furthermore, the results showed that the impact of natural resources and inflation on FDI inflows is insignificant statistically. The present study suggests that the ASEAN policymakers manage their exchange rate effectively, improve the quality of institutions, and adopt vigorous trade liberalization policies to attract more FDI inflows. [ABSTRACT FROM AUTHOR]

We examine the impact of foreign direct investment (FDI) on financial inclusion. To identify the causal effect of FDI on financial inclusion, we use plausibly exogenous source of variations in bilateral investment treaties (BITs) as a novel instrumental variable (IV) for net FDI inflows. Using annual data for a broad panel of 90 countries over the period 2004 to 2017, our results show that FDI improves financial inclusion for both "access to finance" and "use of financial services". This impact is more pronounced for relatively poor countries and developing countries compared to rich and developed countries. We also find that higher financial market development and quality institutions improve financial inclusion directly. Moreover, financial market development and institutional quality can serve as potential channels and moderating variables through which FDI affects financial inclusion. Our results are robust to various estimations and sample splitting and have important implications for policy on financial inclusion. [ABSTRACT FROM AUTHOR]

We examine electoral cycles in tax reforms using monthly data over the period 1990–2018 for 22 advanced economies and emerging markets. We show that governments tend to avoid announcing tax reforms during the months running up to elections. In addition, they become more likely to announce those reforms in the first few months following elections, suggesting that "political capital" and/or "political opportunity" channels play a role in the timing of reforms. These patterns are broad-based regarding changes in the tax base and rates, and for various types of taxes. We also find that the pre-election decrease in the likelihood of tax reform announcements appears to be stronger in emerging markets, and weaker in countries with relatively better institutional quality. Finally, our results indicate that neither fiscal rules nor IMF programs seem to have differential effects on electoral cycles in tax reforms. [ABSTRACT FROM AUTHOR]

Protecting and improving environmental quality is essential for sustainable development. This study considers natural resource depletion, resource tax, institutional quality, and green innovation, which are likely to impact environmental quality. These issues are addressed by Sustainable Development Goals (SDGs) 7, 12, and 18. The study aims to uncover the influence of the variables we have considered on environmental quality in a sample of 18 Organisation for Economic Co‐operation and Development (OECD) countries from 1994 to 2020. Before panel data analysis, we conducted preliminary tests to determine the most suitable techniques. The econometric procedure comprises four stages: unit root analysis, cointegration analysis, estimation of long‐run coefficients using two different methods, and panel causality analysis. The empirical findings suggest that resource tax and green energy innovation positively impact environmental quality for the panel in the long run. Results based on the country show that institutional quality has a negative impact on environmental quality in Portugal but a positive impact in Luxembourg. Although resource taxes positively impact environmental quality in Portugal, they harm Luxembourg. Lastly, natural resource depletion negatively impacts environmental quality in Luxembourg. There are no statistically significant results for other countries. The study concludes with policy recommendations. [ABSTRACT FROM AUTHOR]

The current study investigated the influence of financial development and institutional quality on inclusive growth. Financial Developmenthas a bi-directional effect on inclusive growth. When it comes to establishing a solid connection between inclusive growth and financial development, institutional quality acts as a moderator. GDP per capita income is utilized to determine inclusive growth, credit to private sector is utilized to determine financial development, and rule of law and government effectiveness is used to measure institutional quality. The current study selected four SAARC nations Pakistan, India, Bangladesh, and Sri Lanka and data from 2000-2022, to study the connection between inclusive growth, institutional quality, and financial development. The results showed a negative and significant linear relationship between inclusive growth and financial development, but a strong positive association between institutional quality and inclusive growth. The SAARC countries must therefore adhere to the rule of law and maintain effective government in order to utilize financial resources in pursuit of inclusive economic growth. [ABSTRACT FROM AUTHOR]

This article examines the association between institutional quality, natural resources and multidimensional well-being in Saudi Arabia from 1990 to 2021, filling a notable gap in the existing literature on the linkage between human well-being and natural resources in a country with significant global energy influence. By integrating Sen's capabilities approach and constructing comprehensive indices of human well-being, including quality of life (QL) and standard of living (SL), this study specifically investigates the direct effects of natural resources wealth on these two indices and emphasizes the role of institutional quality as a transmission channel. The results show that natural resources, particularly total natural resource rents and oil rents, have positive direct effects on QL and SL, suggesting that effective resource management can enhance human well-being and economic prosperity. Furthermore, institutional quality plays a key role in shaping this relationship, with factors such as institutional quality index, government stability, and law and order having net positive effects on QL and SL. The study also identifies critical thresholds for controlling corruption, beyond which the positive effects of natural resource rents on QL and SL become more pronounced. These results highlight the importance of accountable and strong institutions to ensure equitable distribution of benefits from natural resources for human well-being. [ABSTRACT FROM AUTHOR]

The research aims to determine the presence of demographic dividends and analyze their gender-specific characteristics. For this purpose, the influence of the total working-age population and the working-age population disaggregated by gender on the socioeconomic outcomes of countries categorized into early-demographic, latedemographic, pre-demographic, and post-demographic transition groups is investigated. The results demonstrated the presence of demographic dividends in both early and late-demographic transition countries. This phenomenon can be attributed to the male working-age population in the case of early-demographic transition countries, whereas for late-demographic transition countries, both genders contribute to this realization. Moreover, the analysis indicated that inflation, globalization, and financial development positively impact socioeconomic performance, whereas trade openness and corruption are associated with a decline in socioeconomic performance. The study highlights the underutilization of the female working population, emphasizing that without their active participation, the dividends of economic participation may either remain unrealized or, if achieved, may not be sustained. [ABSTRACT FROM AUTHOR]

The relationship between external debt and economic growth has been extensively studied by researchers and policymakers. However, the link between external debt and domestic investment remains an underexplored area of research. Therefore, this paper investigates the nexus between external debt and domestic investment, using institutional quality as a moderator. The sample consists of 47 sub-Saharan African countries with data spanning from 1996 to 2021. The empirical findings from conventional and robust estimators indicate that external debt negatively and significantly hampers domestic investment, while institutional quality plays a significant moderating role in this relationship. Additionally, the benefits of debt can only be realized by the SSA region when the average quality of institutions is above − 1.174 on the scale of − 2.5 to 2.5. The in-depth analysis offers insights that high-quality institutions (above a certain threshold) can help countries leverage debt for positive outcomes by promoting efficient resource allocation and attracting further investment. Thus, policymakers are advised to uphold debt management strategies and institutional reforms, such as reducing corruption, improving property rights, and strengthening the rule of law, to ensure transparency in debt use and maintain a sustainable debt burden. This will create a more attractive environment for both domestic and foreign investment. The results remain robust to alternative methodologies. [ABSTRACT FROM AUTHOR]

The study was motivated by increased carbon emissions and high inequality in many of the countries in sub-Saharan Africa (SSA). In this study, we examine whether income inequality in SSA countries increases CO2 emissions, and also investigate empirically whether financial inclusion and institutional quality moderate this connection from the period 2000–2018. For the purpose of examining these links, two proxies for financial inclusion (FI) and an index of institutional quality (IQX) are used. Advanced econometric techniques such as cross-sectional augmented autoregressive distributed lags (CS-ARDL) and augmented mean group (AMG) techniques were used to account for robust, cross-sectional dependence and heterogeneity. The CD-ARDL results demonstrate that the inequalities in the short and long runs are essentially positive, indicating that environmental pollution would rise progressively as the wealth difference widened in the 32 selected SSA nations. The square of income disparity has a negative impact on CO2 emissions, albeit the magnitude varies in the short and long run. Income disparity continues to have a positive impact on CO2 emissions after interacting with financial inclusion in both the short and long run. The results of the interaction term (INEQ*IQX) show that institutional quality has a considerable negative effect on CO2, implying that institutional quality has a major impact on the inequality-CO2 nexus. The robustness of the models is tested using AMG, and the results are congruent with the CS-ARDL estimated results. Hence, based on our findings, we recommend several measures to reduce CO2 emissions in SSA countries. [ABSTRACT FROM AUTHOR]

The establishment of the European Defence Fund (EDF) marks a significant shift in how EU Member States approach the integration of the defence industry as it aims to systematically promote inter-European defence-industrial cooperation across national defence sectors. However, there is a lack of empirical evidence of the actual dynamics regarding EDF implementation. While there are accounts of EU countries' varying political positions on defence integration, including its industrial aspect, it remains unclear whether Member States' actual participation in integration projects aligns with these positions. Are national motives consistent once effective defence-industrial integration is underway? The findings, based on Masson's (2024) data on by-country distribution of EDF project financing (2021--2022), present a more nuanced picture of EU countries' effective engagement with defence-industrial integration than anticipated by the political perspective. While there is a positive relationship between participation in the EDF and defence market size, strategic culture does not influence EU members' involvement in the Fund. Furthermore, while liberal economicindustrial governance is negatively associated with national participation in EDF projects, a country's institutional quality has a significant positive relationship with it. This article reveals more complex dynamics of EDF implementation than suggested by the political perspective on defence-industrial integration pre-EDF. [ABSTRACT FROM AUTHOR]

This study investigates the firms' performance following cross-border mergers and acquisitions (M&As) from 2000 to 2022, employing the generalized method of moments (GMM) technique within the French context. Grounded in the theories of organizational learning and the institutional-based view, the empirical findings reveal that acquiring firms exhibit an improved long-term performance after engaging in cross-border M&A deals. Additionally, acquisition experience and industry relatedness significantly enhance the firms' performance. Institutional quality and cultural similarity are also found to positively moderate the impact of cross-border M&As on firms' performance. [ABSTRACT FROM AUTHOR]

Sustainable development is increasingly recognized for its reliance on grassroots, bottom-up practices embedded in local communities. The economic literature has tested various influencing factors on household behaviors, such as culture or social cohesion, often considering proxies of so-called "intangible capitals" separately. This article aims to jointly consider the pivotal role of three of these potential capitals that could have a trigger effect on pro-environmental behaviors, specifically, social capital (sc), human capital (hc), and institutional quality (iq). In particular, our study, by adopting a PVAR approach, analyzes if and to what extent sc, hc, and iq influence the priority goal of increasing waste-sorting practices in the 20 Italian regions. Additionally, rooted in a robust theoretical framework, we present an in-depth analysis, with the trend of impulses from statistically significant variables—having observed the important roles played by hc, sc, and particularly iq, as well as the control variables GDP per capita and population density—in increasing the percentage of waste sorting. This impulse analysis suggests for policy interventions that there would be immediate effects (1–2 years) due to the improvement of our intangible capitals, but also a short duration. This suggests the need for lasting and structural interventions. [ABSTRACT FROM AUTHOR]

Financial institutions operating in a stable financial system seem to be willing to support the realization of the sustainable development goals (SDGs). This view assumes that financial stability is crucial for sustainable development. We investigate the effect of financial stability on sustainable development. We use a unique financial stability index, sustainable development index and four SDG indicators. We analyse 26 countries from 2011 to 2018 using the system GMM method. The findings of the sustainable development index analysis show that financial stability has a significant effect on the level of sustainable development and the effect is negative in Asian countries. European and Asian countries have a high sustainable development index compared to African countries. The result of the individual SDG analyses show that financial stability has a significant effect on SDG3. Financial stability has a negative effect on SDG10 in Asian countries and a negative effect on SDG3 during periods of economic prosperity. Financial stability has a positive effect on SDG3 and SDG7 in countries where the banking system have high capital buffer. The results show that the effect of financial stability on sustainable development depends on how sustainable development is measured. [ABSTRACT FROM AUTHOR]

Using a panel threshold regression approach, we consider multiple dimensions of socioeconomic inequalities and examine their heterogeneous relationships with sectoral foreign aid. Conditioned on the level of socioeconomic development, three types of inequality and four channels of sectoral foreign aid are considered. We use a comprehensive dataset covering 65 aid‐recipient countries from 1990 to 2017 and find that education aid effectively reduces inequalities but only when the level of institutional quality and other socioeconomic factors is above its 75th percentile value in our sample. These results are robust to alternative measures of income inequality, aid and estimation strategies. [ABSTRACT FROM AUTHOR]

Amidst global environmental reforms, the role of energy systems is under scrutiny to promote ecological welfare through low-carbon alternatives. Amongst the solutions, the role of renewable energy as a clean source has become popular to mitigate climate change. However, the impact of debt on renewable energy consumption remains limited in the economic literature. The debt initiatives provide funding for environmental initiatives primarily, while it is also credited as a barrier to limiting the growth of clean energy programs. Within such discussion, the current study extended the dialogue by examining how external debt impacts energy transition in Brazil, Russia, India, China, and South Africa (BRICS) economies in the presence of institutional quality, education expenditures, and banking development. Using the novel CS-ARDL, AMG, and CCEMG tests, the study results showed that external debt decreases renewable energy consumption, while institutional quality, educational expenditures, banking developments, and economic growth are essential elements of green energy developments. Based on these conclusions, this study provides novel policy guidelines to align BRICS energy and economic agendas. [ABSTRACT FROM AUTHOR]

This study investigates the institutional factors influencing foreign direct investment within the Eurozone of the European Union (EU) and explores their correlation with economic integration. Attracting foreign direct capital investments is closely related to countries' efforts to make their institutional structures more competitive. Because economic integrations can contribute to economic growth by allowing these investments to increase. For his reason, the study focused on the course of foreign direct capital investments in the Eurozone in the 2002-2022 period and the institutional determinants of these investments were analyzed using the panel data method. The empirical analysis revealed that variables such as foreign direct investment, government effectiveness, political stability, and accountability did not experience any significant shocks. In the short term, a direct causal relationship between foreign direct capital investments and corruption has been found. Nevertheless, in the long term, it has been established that variables such as control of corruption, government effectiveness, political stability, rule of law, accountability, and regulatory quality collectively exhibit a causal relationship with foreign direct capital investments. These findings emphasize the importance of institutional structure for increasing foreign direct capital investments. Enhancements in governmental efforts to combat corruption, enhance governance effectiveness, promote political stability, uphold the rule of law, enhance accountability, and improve regulatory quality can significantly contribute to fostering foreign direct investment. In conclusion, this study provides valuable insights into the determinants of foreign direct investment in the euro area and offers guidance for future policy actions. [ABSTRACT FROM AUTHOR]

We analyze the determinants of capital flight in three resource scarce MENA countries namely Egypt, Morocco, and Tunisia. Our methodology involves both the linear and nonlinear autoregressive distributed lag (ARDL) cointegration approaches, with a focus on asymmetric relationships between capital flight and the real exchange rate, to distinguish the impact of real appreciation and depreciation of domestic currency on capital flight. The results based on nonlinear ARDL approach using annual data between 1977 and 2019 indicate that in Egypt, financial openness is negatively related with capital flight, while real depreciation seems to increase it in the long run. Our findings also reveal that the real GDP growth rate, institutional quality as well as inflation are important factors affecting capital flight in Morocco, whereas financial openness and the real exchange rate influence capital flight significantly in Tunisia. [ABSTRACT FROM AUTHOR]

We employed the Bayesian method to investigate the impact of government spending, financial development (measured by bank credit), and trade on income inequality reduction in 66 low‐income countries (LICs) across Africa, Asia, America, and Europe from 2000 to 2018. Controlling inflation and unemployment, our results indicate that trade and inflation exacerbate income inequality in LICs, while financial development and government spending have no impact on reducing income inequality in these countries. Furthermore, the findings show that real GDP per capita reduces income inequality in LICs. To ensure the robustness of our results, we also conducted frequentist quantile regression, which yielded consistent findings that financial development, government spending, and trade do not reduce income inequality in LICs. We further discuss the potential channels through which trade, financial development, inflation, and government spending contribute to income inequality in LICs, and provide policy implications based on the empirical evidence. Related Articles: Adegboye, Alex, Kofo Adegboye, Uwalomwa Uwuigbe, Stephen Ojeka, and Eyitemi Fasanu. 2023. "Taxation, Democracy, and Inequality in Sub‐Saharan Africa: Relevant Linkages for Sustainable Development Goals." Politics & Policy 51(4): 696–722. https://doi.org/10.1111/polp.12547. Asongu, Simplice, and Nicholas M. Odhiambo. 2023. "The Effect of Inequality on Poverty and Severity of Poverty in Sub‐Saharan Africa: The Role of Financial Development Institutions." Politics & Policy 51(5): 898–918. https://doi.org/10.1111/polp.12558. Polacko, Matthew. 2023. "Turning Off the Base: Social Democracy's Neoliberal Turn, Income Inequality, and Turnout." Politics & Policy 51(4): 538–68. https://doi.org/10.1111/polp.12550. [ABSTRACT FROM AUTHOR]

This paper investigates the effects of institutional quality on tax revenue collection in sub‐Saharan African countries. We include the six institutional quality indicators (i.e., voice and accountability, political stability, regulatory quality, rule of law, control of corruption, and government effectiveness) as explanatory factors for tax revenues and its components in a sample of 42 countries over the period 1996–2019. A system GMM approach was used for the estimations. Consistent with previous results, we find that institutional quality has positive and significant effects on tax revenue collection in sub‐Saharan Africa. Specifically, aggregate total tax revenues, direct taxes, income taxes, and goods and services taxes are positively affected by the six institutional quality indicators. Indirect taxes are positively associated with four indicators, with the exception of government effectiveness and political stability, while tax on international trade are affected by institutional quality factors, with the exception of control of corruption and voice and accountability. These findings indicate that sub‐Saharan African countries should improve institutional quality to boost tax revenue collection. [ABSTRACT FROM AUTHOR]

As the first empirical study of the nonlinear effects of digital business on global value chains (GVC), we provide insight into the nonlinear effects of digital business on the global value chain (GVC) values. We employ four indicators, including the value of online selling, sales through E-commerce, and customer relationship management (CRM) usage, to capture the prevalence of digital business in the economy. By testing a sample of 25 European countries that have been analyzed using various econometric techniques over the period 2012–2019, our estimation results confirm that GVC values are a U-shaped function of digitalization. That is, an increase in digitalization pervasiveness initially induces more significant risks and uncertainties, hindering European countries from getting involved in or scale-up within the GVC. However, a rise in digitalization pervasiveness goes beyond a specific threshold, which facilitates GVC activities as more opportunities are created. Furthermore, our findings suggest that digital business contributes significantly to reducing the adverse influences of global uncertainty on the GVC values, while the marginal effects of digital business on GVC values become more pronounced in countries with the most advanced institutional structure. [ABSTRACT FROM AUTHOR]

Achieving carbon neutrality is essential for environmental sustainability and should be pursued with minimal disruption to economic growth. China's recent commitment to carbon neutrality holds significant importance in current discussions. This study investigates strategies to achieve sustainable development goals (SDGs), emphasizing carbon neutrality. It also examines the long-term impacts and causality between fiscal decentralization and institutional quality in relation to carbon dioxide (CO2). emissions Utilizing the quantile autoregressive distributed lag (QARDL) approach and the Granger causality in quantiles, our findings reveal a statistically negative ECM parameter across all quantiles. This indicates a stable, long-term relationship between fiscal decentralization (FDC), institutional quality (INSQ), and CO 2 emissions. The study verifies the presence of the Environmental Kuznets Curve (EKC) hypothesis in China across different quantiles. In the long run, fiscal decentralization seems to increase CO 2 emissions, but robust institutional quality mitigates this impact. The Granger causality results highlight the intricate relationships among the variables. This research emphasizes the need for policymakers to bolster environmental protection and efficiency, ensuring fiscal decentralization benefits both environmental and economic agendas. [ABSTRACT FROM AUTHOR]

The financial sector plays a vital role in fostering economic growth, regardless of a nation's development stage. However, East Africa, compared to other regions, faces unique challenges in advancing its financial landscape. While the existing body of research acknowledges the significance of financial development in promoting economic growth, some studies need more regional specificity, focusing on broader frameworks that may neglect specific factors like the quality of institutions within East Africa. This research addresses this gap by investigating the relationship between financial development and economic growth in 18 East African countries from 1995 to 2021. Employing dynamic panel estimation (GMM) to address potential Endogeneity and reverse causality concerns, the study delves into the moderating effect of institutional quality on this relationship. Factors like government stability, rule of law, presence of the military in politics, and corruption control measure institutional quality. Additionally, the study controls for other relevant factors influencing economic growth. Data sourced from reputable international organizations such as the World Bank, International Monetary Fund, and relevant risk assessment institutions serves as the basis for analysis. The findings reveal that the impact of financial development on economic growth in East Africa is multifaceted. While financial development itself demonstrates a positive influence on growth, this effect is significantly amplified in countries with stronger institutional frameworks. This suggests that robust institutions act as a catalyst, maximizing the positive impact of financial development on economic growth. [ABSTRACT FROM AUTHOR]

Copyright of Journal of Entrepreneurship & Development / Girisimcilik ve Kalkinma Dergisi is the property of Journal of Entrepreneurship & Development / Girisimcilik ve Kalkinma Dergisi and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This study aims to assess the role of technological advancement and institutional quality in mitigating the formal economy and fostering more inclusive economic well-being for families and consumers in ASEAN countries. This study employed panel data analysis using yearly data for the ten countries in ASEAN, spanning from 2008 to 2018. Findings indicate significant and diverse impacts of technological advancement on the informal economy. The study found that the interaction between technological advancement and economic growth strengthens the relationship between the informal economy across models. The higher economic growth in a country is associated with reduced informal economic activities, as reflected in the principles of modernization theory. The finding further shows the significance of institutional quality in shaping the informal economy. Strong institutional quality helps to create a structured environment that reduces informal economic activities, aligning with neoliberal theory. Governance quality, including the absence of violence and terrorism and the control of corruption, plays a role in mitigating informalities. The study’s primary contribution is its specific focus on the informal economy and the intricacies of ASEAN nations. The study also provides empirical insights into the behavior and determinants of the informal economy in ASEAN nations. Even though the study acknowledges limitations related to data availability and the challenges of quantifying the gig economy, it holds valuable policy implications. [ABSTRACT FROM AUTHOR]

This study investigates how natural resources and institutional quality (IQ) impact the economic growth of the Democratic Republic of the Congo (DRC). Based on data annually from 1985 to 2022 using ordinary least squares regression the findings highlight that human capital development, inflation, foreign direct investment (FDI), oil rents, forest rents, political instability, conflict, and corruption significantly hinder the country's economic progress. This suggests that despite its abundant natural resources, the DRC faces more economic challenges than benefits from them. As a result, the study recommends stringent monitoring and oversight of mineral revenue management, establishment of stable political conditions, and aggressive measures to combat corruption and conflict. These actions are crucial in transforming the current curse of natural resources into a potential blessing for the country. [ABSTRACT FROM AUTHOR]

One possible way to achieve sustainable economic growth is by limiting carbon dioxide (CO2) emissions. The developing countries, in particular, which significantly contribute to global carbon dioxide emissions, need a paradigm shift towards sustainable production and consumption to achieve economic growth while ensuring environmental sustainability. This study thus analyzes the role of green technology innovation, green finance, renewable energy use, institutional quality, and agricultural value added in attaining environmental sustainability by abating CO2 emissions for 25 select developing countries from 1998 to 2019. This study uses the Driscoll‐Kraay and two‐step SGMM estimators to assess the impact of independent variables on the response variable, acknowledging the endogeneity problem in the model. The empirical findings reveal that green finance, green technology innovation, and institutional quality induce CO2 emissions, whereas agricultural value‐added and renewable energy use are observed to have detrimental effects on CO2 emissions. Moreover, the moderation effect of green technology innovation and institutional quality with green finance is observed to have a weak and insignificant impact on CO2 emissions. The study thus recommends that developing countries enforce policies to promote investments and innovation in the clean energy sector to attain sustainable development goals by mitigating carbon emissions. [ABSTRACT FROM AUTHOR]

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In view of the United Nations' Sustainable Development Goals on clean and responsible energy consumption, climate change mitigation, and sustainable economic growth (UN-SDGs-7, 11–13), this study examines institutional quality (IQ)–carbon emissions nexus in the framework of the Environmental Kuznets Curve (EKC) hypothesis. Six dimensions of IQ from the World Governance Indicators (WGIs) were used while focusing on Sub-Saharan African (SSA) countries between 1996 and 2019. After controlling for growth, energy use, and industrialization levels, the empirical results validated the EKC hypothesis for the SSA as a unit increase in economic growth initially worsens the environment while further economic expansion eventually improves the environment. However, mixed results were obtained on the effects of IQ indicators. CO2 emissions are only substantially reduced by corruption control, regulatory quality, and the rule of law among other IQ measures. Furthermore, the causality analysis showed a unidirectional causality between growth and environmentally detrimental energy consumption levels coupled with a two-way emission-population growth causality flow as well as a two-way emissions—IQ causality channel. While economic growth, energy use, and industrialization levels undermine environmental sustainability in the SSA region via increased carbon emissions, the overall findings signal the moderating roles of IQ. Hence, the strengthening of institutions is recommended for environmental sustainability enhancement in the SSA region. [ABSTRACT FROM AUTHOR]

This study examines the nexus between institutional quality and FDI inflows in SAARC countries for the sample period of 1996–2017. The analysis is carried out using panel ARDL and panel quantile regression to draw the inferences. Empirical findings reveal that corruption, political stability, government effectiveness, and GDP per capita have a positive and statistically significant impact on FDI inflows. The result of panel quantile regression shows that all the estimates of government effectiveness, GDP per capita, and trade openness are positive and statistically significant. This exploration suggests that institutional quality matters to the progression of FDI inflows. Along these lines, effective institutional changes should be a precedence for policymakers as this sets up an admirable investment climate to pull in FDI inflows in SAARC countries. [ABSTRACT FROM AUTHOR]

Population plays a direct role in the production and demand of goods and services. Moreover, through indirect channels, the skilled and educated population, represented as the human capital as well as the process of research and development, innovation, and foreign direct investment, it can generate some complex and diverse products and, thus, would lead to creating the economic complexity of countries. Ultimately, all of these mechanisms can be employed under the appropriate institutional environment. Thus, the goal of this study is to explore the interaction of population, globalization, and institutional factors in achieving economic complexity. For this purpose, the population is divided into two categories: a population that is ready to work and produce, active population (between 15 and 64 years), and others (less than 14 years and over 65). The results of estimating the panel model by fully modified OLS (FMOLS) method during 1995–2019 show that the inactive population has a positive effect on the economic complexity in D8 countries. This means that this category of population is considered as a remarkable market for complex products. Furthermore, the interaction of active population, globalization, and institutional variables on the economic complexity of the studied countries is positive. This paper suggests that if the potential capacities of globalization and targeted guidance of the productive population are used, in the shadow of improving the institutional quality, we can see the positive effect of the productive population on the economic complexity of countries. [ABSTRACT FROM AUTHOR]

Many studies suggest regime type—particularly democracy—is associated with economic performance. However, in the Middle East and North Africa, regimes are mostly non-democracies, yet there is a wide variation of economic performance. To understand this variation, this study investigates how institutions impact economic performance in MENA countries. The study utilizes panel data on twenty-one MENA states from 1996 to 2018. The main results of the appropriate fixed-effects model suggest that institutional quality impacts economic performance across countries in MENA. Specifically, the findings show that improvements in labor, investment, public, and political institutions are the key to enhancing real per capita GDP. MENA countries' different research endowments carry different institutional deliverables in their economies. Resource-rich, labor-poor countries, and OECD countries experience better capacity for the effects of institutions on economic performance. Conversely, labor-abundant MENA countries are shown to experience lower economic performance due to the weak existing institutions. Results of the study provide policy implication to enhance the knowledge setting within the institutions for better economic performance. [ABSTRACT FROM AUTHOR]

The complexity of taxes has been widely discussed in the literature and can be defined and measured in various ways depending on one’s perspective. Institutions play a crucial role in shaping the strategic environment and understanding them is crucial in understanding the policy process. When designing taxes, it is vital to consider how institutions influence tax complexity. In this empirical study, we take an institutional approach to examine what extent the institutional quality supports the tax simplification process. Using the system generalised method of moments (system GMM) for a dynamic panel of 88 countries, we show that higher institutional quality seems to be associated with a lower degree of tax complexity, regardless of income levels and legal origins. These findings are robustly consistent across a variety of specifications and institutional measurements. To that end, we make policy recommendations on tax administration. [ABSTRACT FROM AUTHOR]

This paper assesses how the local institutional environment affects the internationalization of manufacturing small- and medium-sized enterprises (SMEs) in Vietnam, exploiting a multi-dimensional institutional index and large-scale enterprise data. The authors find that the internationalization of manufacturing SMEs was influenced by several institutional aspects, such as the transparency of local authorities, access to land, informal charges, and local labor policies. Improvements in these institutional aspects can substantially enhance participation in international trade and its magnitude. This pattern diverges from their large and foreign counterparts, whose trade participation is primarily affected by land access and the transparency of local authorities. Additionally, the authors find heterogeneous effects of the institutional environment on SMEs in different manufacturing industries. Heavy industries rely more on the costs of entry and time costs, while land access is crucial for SMEs in manufacturing industries that require large-sized factories. Our findings suggest that the government should provide a supportive institutional environment to SMEs, which will lead to higher international participation and boost domestic economic growth. [ABSTRACT FROM AUTHOR]

Purpose: The majority of MENA countries suffer low levels of human development, coupled with scarcity of funding resources, low level of governance, and poor institutional environment. Consequently, this research aims at detecting the impact of development finance resources and institutional quality on the human development in the MENA region, in order to examine if/why the MENA countries fail to efficiently exploit all the available financial inflows to promote human development and boost living standards. Design/methodology/approach: This study tests the short- and long-run impact of six financing resources representing injections in the economy and four institutional quality variables on the human development index in the MENA region. It adopts co-integration analysis, vector error correction model, and Granger causality test on a sample of 13 MENA countries over the period 1996–2019. Findings: This research finds that domestic credit to private sector and exports of goods and services do not have any significant added value for human development in the MENA region. In contrast, government expenditures and migrant remittances are found to be crucial in promoting human development in both the short- and long-run. FDI and ODA do enhance human development, but only in the short-run. In parallel, control of corruption, government effectiveness and regulation quality are essential boosters of human development in the MENA region, but with different importance, while political stability was found to be irrelevant. Originality/value: To the authors' best knowledge, this is the first study that examines the impact of financial inflows and institutional quality on the overall human development index in the MENA region. The contribution of this paper lies in unlocking for policymakers the potential impactful financing resources to serve national developmental plans, in an endeavour to catch up to the SDGs amid the additional challenges imposed by governance and institutional environment. [ABSTRACT FROM AUTHOR]

Abstract This paper assesses the National Recovery and Resilience Plans (NRRPs) of EU member states and regions to uncover commonalities and differences between green and digital transitions, focusing on the role of institutions, among additional socio‐economic drivers, in modeling them. To that end, relevant indicators have been assembled, and several econometric models have been developed and tested to evaluate institutional performance in relation to green and digital transformations. The study reveals discrepancies in the two explored transition fields and highlights the power of institutional factors in boosting them. Specifically, the findings demonstrate that the green transition in EU regions is positively associated with variables such as life expectancy, institutional quality, tertiary education attainment, and small and medium enterprises (SMEs) with innovative activities, while the fruits of digitalization are mainly allied to population with higher studies, core creative class employment, accountability of institutions, and innovative SMEs. These insights offer valuable guidance for decision‐makers to draw lessons from high‐performing or successful regions and strategically assign resources. This includes paying attention to regional financial allocations and their alignment with territorial planning and long‐term policies.

Background: This research focusses on the significance of institutional quality (INSQ) and governance in shaping the relationship between foreign direct investments (FDI) and growth. It specifically examines the BRICS nations (Brazil, Russia, India, China and South Africa) because of their economic significance in the global economy. Aim: This study aims to analyse the impact of INSQ and governance on sustainable growth, with a particular focus on its effects through the channels of FDI in the BRICS countries. Setting: Annual panel data from the Organisation for Economic Cooperation and Development (OECD) statistics, the United Nations Conference on Trade and Development (UNCTAD) statistics and the World Bank indicators spanning two decades (2000–2022) are used to analyse BRICS nations. Methods: The research study employed the Bayesian time-varying coefficient vector autoregression (BTVC-VAR) model to achieve the objective of the study. Results: The findings indicate that there is no long-term relationship between FDI, INSQ and economic growth in the BRICS countries. However, there is a noticeable co-movement among these variables in the short run. Conclusion: Given the obtained results, the policymakers should prioritise efforts to strengthen institutional capacity in the short term while focussing on the Sustainable Development Goals (SDG-8 and SDG-16). Contribution: The existing studies have assumed static economic, social and political conditions, potentially failing to accurately depict the complexities of an actual economy. This study offers methodological innovation by employing Bayesian time-varying coefficient vector autoregression (BTVC-VAR), enabling coefficients to adapt to evolving economic conditions over time. This effectively captures the dynamic nature of variables and provides reliable estimates.

Background: Countries in the Southern African Development Community (SADC) region have experienced low growth coupled with high levels of poverty and inequality. Economic growth has been touted as one of the major factors to deal with these problems. However, the lack of financial resources has hampered the efforts to achieve high levels of growth. This has therefore resulted in the countries putting much effort on attracting foreign capital. Aim: The study aims to investigate the extent to which financial development (FSD), financial openness, and institutional quality determine the inflow of foreign direct investment (FDI) in the SADC region. Setting: The study focuses on 15 countries in the SADC region from 2008 to 2022. Method: The study employs the Generalised Method of Moments (GMM) technique given the problem of endogeneity between the variables of interest. Results: The findings from the study indicate that FSD and financial openness are important factors determining the flow of FDI to the SADC region. On the other hand, the effect of institutions was found to be significant when taking into account the state of FSD and financial openness. Conclusion: Policymakers are encouraged to focus on enhancing institutional frameworks, promoting FSD, and increasing financial openness to optimise capital inflows. Contribution: The study contributes to the available studies by incorporating the role that is played by institutional quality and financial openness to the modelling. This becomes important as the region aims at attracting more foreign capital so as to improve growth as domestic capital supply falls short of domestic capital demand.

The study examines the impact of human capital and institutional quality on income inequality from 1990 to 2021. This study adopts the Kuznets model as its theoretical framework. The unit root test revealed a mixed stationary in the variables which prompts the choice of Autoregressive Distributed Lag of which its bound test result shows that there is a cointegration in the variables. The long-run results show that government expenditure on education, government expenditure on health, government effectiveness, and domestic credit to the private sector have a positive but not significant effect on income inequality while in the short-run, government effectiveness and domestic credit to the private sector have a positive but not significant impact on income inequality. Moreover, only government expenditure on education affects income inequality in the Nigerian economy positively and significantly. Based on the findings revealed, the study recommends that the government should by all means and economic resources increase the budget of human capital to enhance the reduction of income inequality in the country and place more emphasis on providing education grants and incentives that encourage the reduction of brain drain.

China's energy transition is a pivotal component of global efforts to combat climate change. This study identifies the synergistic effects of key factors driving this transition, including social-technology-economic, policy, investment, governance indicators. Asymmetric nexus impacts are explored by using quantile-on-quantile regression (QQR) method. Further, the synergistic effects of key drivers on China's energy transition are examined by model 1–4. The findings show that reconciling the tradeoffs of reducing coal emissions and promoting clean energy are crucial for China's energy transition. Urban growth, environmental taxes, financial development, and strong environmental governance and institutional quality significantly support these efforts, but show different synergistic effects scenarios. These findings also reinforce the need for a more inclusive response to China's energy sustainability challenges, in particular, coordinated policies and strategies in coal-reliant industrial sectors are critical for a successful energy transition.

In the contemporary landscape, sustainable development became major challenge for the economy which is tackled if environmental issues are resolved. In this regard, this study investigate renewable energy, institutional quality, foreign direct investment (FDI), economic growth on environmental pollution in E−7 countries (Brazil, Russia, China, Indonesia, India, Mexico, and Turkey). Utilizing annual data from 2002 to 2023, selected the panel Nonlinear Autoregressive Distributed Lag (NARDL) after applying stationary process. The results depict that there is short and long run relationship among the selected variables, CO2 emissions exhibit an asymmetrical response to positive and negative shocks in exogenous variables. A one-percent change in FDI, GDP, IQ and EC reduce the carbon emission. Our research concludes with policy recommendation that prioritize priorities economic growth and environmental sustainability. To achieve a healthy environment and sustainable growth in the E7 countries, it is essential to strengthen institutional frameworks, encourage green investments, and foster technical innovation.