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We examine the nexus between financial inclusion and energy poverty. Analysing data for 27 energy-poor countries in the Sub-Saharan Africa region over 2004–2021, we employ sequential (two-stage), panel-corrected standard error (PCSE) and two-step dynamic system GMM (generalized method of moments) regression models, and control for endogeneity, CSD, slope heterogeneity as well as stationarity and cointegration patterns of the variables. Our empirical results show that financial inclusion significantly reduces energy poverty in the selected energy-poor countries. The study also finds a positive significant association between energy access and GDP per capita, while oil price and energy intensity are inversely associated with energy access. The results are robust to different control variables, estimation methods and subsamples. These findings have strong policy implications for energy-poor countries and point to the need for appropriate policies to promote financial inclusion for reducing energy poverty. [ABSTRACT FROM AUTHOR]

The use of multilevel regression models is prevalent in policy analysis to estimate the effect of group level policies on individual outcomes. In order to allow for the time varying effect of group heterogeneity and the group specific impact of time effects, we propose a group interactive fixed effects approach that employs interaction terms of group factor loadings and common factors in this model. For this approach, we consider the least squares estimator and associated inference procedure. We examine their properties under the large n and fixed T asymptotics. The number of groups, G, is allowed to grow but at a slower rate. We also propose a test for the level of grouping to specify group factor loadings, and a GMM approach to address policy endogeneity with respect to idiosyncratic errors. Finally, we provide empirical illustrations of the proposed approach using two empirical examples. [ABSTRACT FROM AUTHOR]

We study the effect of euro adoption on various property crimes for a group of Eurozone countries with data from 1993 to 2019. We hypothesize euro adoption has a positive association with home burglaries and robberies as the euro is relatively more valuable and mobile than pre-euro currencies. We offer a simple theoretical model to motivate the hypothesis. A dynamic panel data model is estimated by generalized method of moments (GMM) to account for endogeneity, measurement error, heteroskedasticity, and serial correlation. Our results indicate some evidence of a positive relationship between euro adoption and property crimes. Other countries considering euro adoption may find the results of our study informative. [ABSTRACT FROM AUTHOR]

A new set of tools to measure the time stationarity, shape and ordinal ranking bias of Revealed Comparative Advantage (RCA) indexes is suggested. The aim is to help select the most consistent RCA index for a given set of countries, products and time periods, which is especially relevant for economic policy based on comparative advantages. The GMM estimation of an AR(1) process based on RCA indexes provides three measures of time stationarity that are more rational than the measures available in the literature. Furthermore, we revise the statistics that are commonly used to capture shape. Finally, with respect to ordinal ranking bias, we modify the use of Spearman's rank correlation coefficient in Leromain and Orefice (Int Econ 139:48–70, 2014) and generalize the non-parametric measure of Stellian and Danna-Buitrago (J Appl Econ 22(1):349–379, 2019). We discuss different methods of ranking RCA indexes according to all proposed measures. An application to 33 RCA indexes, 67 trade areas and three product classifications shows that, on average, the most accurate RCA indexes are Contribution-to-the-Trade-Balance indexes, Revealed Competitiveness indexes and regression-based indexes. [ABSTRACT FROM AUTHOR]

This research investigates the factors influencing the capital structure of 271 non-financial firms listed on the Korean Stock Exchange (KSE) over a broad period from 1995 to 2021, encompassing both stable and crisis conditions. Employing a dynamic panel data model and the generalized method of moments (GMM) estimation, we address the endogeneity issue introduced by the inclusion of lagged dependent variables. Our research integrates firm-specific internal factors with macroeconomic external variables to provide a comprehensive understanding of the influence of varying economic environments on capital structure. Our study suggests that in times of economic stability, the capital structure decisions of a firm are more influenced by internal factors such as profitability. However, in periods of economic downturns, it is the external macroeconomic market conditions that tend to have a greater impact on these decisions. It is also noteworthy that both book leverage (BL) and market leverage (ML) exhibit quicker adjustments during stable periods as opposed to periods of crisis. This indicates a higher agility of firms in adapting their capital structures in stable, normal conditions. Our findings contribute to the existing literature by offering a holistic view of capital structure determinants in Korean firms. They underscore the necessity of adaptable financial strategies that account for both internal dynamics and external economic conditions. This study fills a gap in current research, presenting new insights into the dynamics of capital structure in Korean firms and suggesting a multifaceted approach to understanding capital structure in diverse economic contexts. [ABSTRACT FROM AUTHOR]

ABSTRACTUsing a dataset of 107 listed firms in Jordan from 2009 to 2018, we employed the generalized method of moments (GMM) to examine the effect of ownership structure on the level of corporate cash holdings. We found that higher government ownership is associated with higher cash holdings. On the other hand, different forms of ownership, namely block holding and individual and foreign ownership, were found to be insignificant. We further examined why firms in Jordan hold cash, concluding that when the level of government ownership rises, firms do not employ cash reserves for investments nor for dividend payments, which in light of governmental political purposes could be a clear indicator of agency problems.

AbstractThis study aims to examine whether board structure (board size, board composition, CEO duality, and board gender diversity) is associated with bank performance. To do so, the study makes use of panel data of 14 commercial banks in Ethiopia covering a 9-year period during 2011–2019 which results in 126 bank-year observations. The findings of the study show that board composition (BCOMP) and board gender diversity (FDIRS) have positive and significant impacts on bank performance. This implies that the increase in the proportion of independent directors and female board members in the board room increases bank performance. On the other hand, the results reveal that board size (BSIZE) and CEO duality (DUAL) decrease bank performance: Both of these variables have significantly negative effects on bank performance. This means that bank performance decreases as the number of board of directors increases. Also, bank performance decreases when a single individual is jointly responsible for the CEO position with the board of directors as well as board chairperson responsibilities. The results suggest that the board has a considerable role in the Ethiopian bank governance. Hence, the results could benefit policy experts and regulators to formulate policies on recuperating board governance.

A typical situation in survival analysis is that there is only interest in one risk and some prior information about its distribution is available. At the same time, other risks are not of interest and no information about risk dependence is available. A parametric regression model with unknown dependent censoring would be suitable here, but existing approaches require restrictions on all marginal survivals, the censoring distribution or the degree of dependence. This article introduces a model without these restrictions. An application to employment duration demonstrates that it avoids sizable bias of the estimated gender effect on employment duration. [ABSTRACT FROM AUTHOR]

This paper examines the effects of institutional factors and government policy responses on COVID‐19 infection cases. It applies the Random Effects (RE) and GMM (Generalised Method of Moments) estimation techniques to panel data to explore the relationship between COVID‐19 cases on the one hand and institutions and government policy responses on the other. The paper finds that the nature and timing of policy responses matter and that institutions play a crucial role in explaining observed infection cases across countries. The results also indicate that high population density and previous experience with infectious diseases are important factors in explaining infection cases across countries. One of the policy implications of our findings is the importance of timely policy intervention at the national level in reducing infection cases. [ABSTRACT FROM AUTHOR]

Our research study aims to analyze the effect of government expenditure on goods and services and capital toward regional economic growth in Indonesia. We position local tax effort as a moderating variable between economic growth and government expenditures. Using a panel data set of 24 provinces in Indonesia from 2006 to 2015, a dynamic model of GMM was applied to estimate the effect of public expenditure on growth. The research study provides empirical evidence that the two kinds of public spending positively and significantly affect economic growth. Conversely, local tax efforts negatively affect economic growth. Besides, local tax efforts also reduce the positive impact of capital expenditure on economic growth. In other words, local tax efforts negatively moderate the influence of government expenditure on the output growth of the regional economy. [ABSTRACT FROM AUTHOR]

The 2030 agenda for sustainable development establishes a new global sustainability target, with corporations expected to contribute significantly by implementing sustainable practices. One strategy for engaging corporations in sustainable practice focuses on corporate governance (CG) mechanisms, such as the board of directors (BOD). On the premise of stakeholder theory, agency theory and resource dependency theory, the relationship between BOD and corporate sustainability performance (CSP) was investigated using the panel data analysis. Utilising a sample of 335 energy sector corporations from 48 countries our GMM estimation shows a significant relationship between CSP and board size, different positions for CEO and Chairperson roles, and interlocking directors. The findings also showed that having more independent directors on a board lowered CSP, while gender and cultural diversity did not affect CSP. The implications of these findings to policymakers on the energy sector corporations are not limited to improving CSP via formulating and implementing specific CG strategies and policies that are beneficial but also provide explicit information on how corporate energy sectors can change their behaviour with respect to sustainable practices and good governance to address social and environmental issues. [ABSTRACT FROM AUTHOR]

Few studies are found to examine the relationship between financial openness and economic complexity. Using a panel data of 120 economies during 1996–2016, this paper aims to examine the impact of financial openness, human capital, institutional quality, banking industry concentration, and other factors on economic complexity. We establish dynamic panel models that incorporate lagged‐dependent variables and employ the Generalized Method of Moments (GMM) for estimation. Our pooled‐sample regression results show that the enhancement of overall financial openness could increase the economic complexity significantly, as well as de‐facto and de‐jure openness. The subsample regressions indicate heterogeneous impacts of financial openness depending on country groups and industry. Besides, there exists significant path dependence for ECI improvement, which is more prominent in high‐income countries. For low‐ and middle‐income countries, greater GVC participation and lower banking concentration can promote ECI improvement significantly. [ABSTRACT FROM AUTHOR]

This research investigates the factors influencing the capital structure of 271 non-financial firms listed on the Korean Stock Exchange (KSE) over a broad period from 1995 to 2021, encompassing both stable and crisis conditions. Employing a dynamic panel data model and the generalized method of moments (GMM) estimation, we address the endogeneity issue introduced by the inclusion of lagged dependent variables. Our research integrates firm-specific internal factors with macroeconomic external variables to provide a comprehensive understanding of the influence of varying economic environments on capital structure. Our study suggests that in times of economic stability, the capital structure decisions of a firm are more influenced by internal factors such as profitability. However, in periods of economic downturns, it is the external macroeconomic market conditions that tend to have a greater impact on these decisions. It is also noteworthy that both book leverage (BL) and market leverage (ML) exhibit quicker adjustments during stable periods as opposed to periods of crisis. This indicates a higher agility of firms in adapting their capital structures in stable, normal conditions. Our findings contribute to the existing literature by offering a holistic view of capital structure determinants in Korean firms. They underscore the necessity of adaptable financial strategies that account for both internal dynamics and external economic conditions. This study fills a gap in current research, presenting new insights into the dynamics of capital structure in Korean firms and suggesting a multifaceted approach to understanding capital structure in diverse economic contexts.

Purpose: The purpose of this study is mainly to investigate the stimulating effect on technology transactions of trade competition resultant from RMB appreciation. Design/methodology/approach: This study uses Chinese provincial panel data from 1998 to 2015 and utilizes GMM method to estimate the stimulating effect of RMB appreciation on technical transactions through trade competition. Findings: The results demonstrate that RMB appreciation can encourage enterprises to make use of domestic technology market resources for innovation. Specifically, the increase in imports due to the appreciation of RMB can generate technology spill-over and significantly promote technology trade. The export competition resultant from RMB appreciation can also encourage domestic and foreign enterprises to enhance export competitiveness through increased technology transactions. Originality/value: The current research investigates the impact of exchange rate on independent innovation, but this study demonstrates the influence of exchange rate on technology transactions. In addition, the data in this study cover 1998–2015 in China and thus contributes to determining the effects of exchange rate appreciation in emerging countries. [ABSTRACT FROM AUTHOR]

The paper focuses on the impact of food aid and governance quality (the latter disaggregated in different components) on both food and nutrition security in the SSA region and for a sample of 25 countries over the period 1996 to 2018. The main novelty and contribution of the paper in the relevant literature is by providing macro-level evidence in the SSA region to complement country-specific evidence in this research area. We also use different food and nutrition security outcome measures, which include the average value of food production, average dietary energy supply adequacy, and prevalence of undernourishment. Furthermore, we combine the above with the use of both aggregated and disaggregated governance indicators to examine the impact of governance quality on the outcome variables. We find evidence of a robust relationship between food aid, governance quality, and food and nutrition security outcomes by employing the GMM estimator. We also find that food aid increases food and nutrition security while it reduces undernourishment. Among the various governance quality indicators we have employed, the control of corruption and political stability show a significant relationship with the measured outcomes. However, the composite governance index and food aid jointly have no significant effect on food security, but they significantly increase nutrition security and reduce undernourishment across the various empirical models we have employed in our empirical analysis. An important policy lesson emanating from our empirical findings is that controlling corruption and maintaining political stability may have significant implications for enhancing the impact of food aid on food and nutrition security in the region. [ABSTRACT FROM AUTHOR]

This study examines the linear and non-linear threshold impacts of transparency on economic growth in 70 developing countries from 1984 through 2018, utilizing panel generalized method of moments (GMM) and dynamic-panel threshold estimations. We find that the impact of transparency on growth is stronger when we use non-linear GMM, and dynamic-panel threshold estimations. There is a U-shaped relationship between transparency and economic growth, while transparency is found to stimulate economic growth, especially in a high-transparency threshold regime. The result reveals that financial development plays an important role in moderating the transparency–economic growth nexus in developing countries. [ABSTRACT FROM AUTHOR]

This paper examines the impact of taxes on the economic growth based on classifying countries by GDP per capita and a tax burden. The Partitioning Around Medoids (PAM) technique is used because it is not too sensitive to outliers. Through this multicriteria classification technique, the Generalized Method of Moments (GMM) is employed to analyze the data of the three groups consisting of 63 countries from 2003 to 2017. The results show that most taxes have a positive impact on economic growth in poor countries (Group 1). Interestingly, taxes on goods and services promote economic growth in rich countries (Group 3), rather than having a negative effect, as is concluded by some previous studies. Specially, while the property tax has a negative effect on economic growth in rich countries, its impact is significantly positive in poor countries.

This study focuses on analyzing the role of corruption control in the impact of government expenditure on economic growth. The data were collected from 16 Emerging Markets and Developing Economies (EMDEs) in Asia over the period 2002–2019. Generalized method of moments (GMM) and threshold model were used to estimate research models. The estimation results show that government expenditure and corruption control have a negative impact on economic growth. Specifically, the interaction between government expenditure and corruption control can reduce the level of the negative impact of these two factors on economic growth, which is an interesting finding of this study. Moreover, unlike previous studies, the threshold model estimation results reveal that corruption control has two threshold values of -0.61 and 0.01, respectively. Accordingly, EMDEs in Asia can make the positive impact of government expenditure on economic growth if corruption control is above the threshold value of 0.01.

This paper examines the effect of R&D investment on firms' level cash holdings in the UK market after the financial market crisis, using the trade-off model and the pecking order model as a theoretical backdrop. For this purpose, we employ a sample of UK listed non-financial no-utility firms throughout 2010–2018. Our findings indicate that R&D spending provides a reasonable explanation for UK firms' increased cash ratio during post-crisis. Using Fama and French's (Industry costs of equity. J Financ Econ 43(2): 153–193, 1997) classification, we conduct cross-sectional linear regression analysis for industry and firm groups' sub-samples. The analysis provides evidence of considerable heterogeneity in terms of cash holding and investment spending across industries. What is more, technology and healthcare firms have contributed to the increase in cash levels. The findings reveal a positive and significant effect of R&D intensity on cash holdings, while R&D-intensive firms hoard cash driven by industry concentration. We confirm our findings' persistence after performing various additional analyses and robustness checks. This is the first study to provide empirical evidence in the post-crisis era on how R&D influences firm-level cash holdings in the UK market setting. [ABSTRACT FROM AUTHOR]

Noninterest income (NII) is income generated by banks from sources other than interest payments. Studies conducted on the relationship between NII and bank risk for the USA and Europe have found that emphasis on income diversification lowers risk in European banks but exacerbates it in American banks. Current research on Asian banks has not led to a coherent view of the relationship between NII and bank risk. We employ data over 25 years for 24 Asian countries to examine this relationship. Using the GMM estimation approach we estimate equations for two time-periods, 1996–2007 and 2008–2018, to examine the NII-bank risk relationship in the presence of some controlling financial, macroeconomic and policy variables. Our results show that non-interest income worsens bank risk for all 24 countries as well as for sub-groups of countries. We also find that, by and large, economic growth improves bank risk while inflation above a threshold worsens it. Finally, our proxy measure for monetary policy improves bank risk though fiscal policy seems to have no effect. [ABSTRACT FROM AUTHOR]

This study contributes to the current debate on the downsides and benefits of revenue diversification. Diversification may affect banks when they invest in riskier activities with lower returns, while they benefit from diversified activities that are less risky but have higher returns. The study offers extended implications in the empirical literature using a different measure of revenue diversification from an emerging market perspective. The study uses recent financial data from 26 Malaysian and Nigerian banks for the period 2009–2017, totaling 234 observations. The GMM estimation technique is employed to test the relationship. The results show that revenue diversification – non-interest income/gross revenue ratio (NII), fee and commission income/revenue ratio (NII1), and non-interest income/total assets ratio (NIITA) – significantly affect the firm value and stability of Nigerian banks. Liquidity, administrative expenses, net interest margin (NIM), non-performing loans (NPL), size, GDP growth rate and inflation also affect the firm value and stability of a bank. For Malaysian banks, diversification variables do not significantly affect firm value of a bank, while liquidity, administrative expenses, NIM and size significantly affect firm value. Diversification (NII and NIITA), liquidity, administrative expenses, NIM, NPL, size, GDP growth and inflation rate has a significant impact on the stability of Malaysian banks. The study concludes that revenue diversification affects both the firm value and stability of banks, and to achieve sound financial stability, banks that focus on interest-generating activities may diversify into non-interest-generating activities.

This paper takes the inter-provincial panel data of China from 1999 to 2015 as the research sample and uses the GMM estimation method to empirically test the relationship among education input, social security expenditure, and urban-rural income gap. The results show that education input and social security expenditure have a significant impact on the urban-rural income gap, and there are regional differences. Specifically, the augments of education input and social security expenditure widens the urban-rural income gap in the western region, and narrows the urban-rural income gap of the eastern and central regions but has less impact on the eastern region. The paper provides a new perspective for understanding the urban-rural income gap in China, and has a significance meaning for further increasing the educational investment in the western rural areas, and improving the redistribution efficiency of social security expenditure.

• This study focuses on the relationship between occupational accidents and a company's profitability, including a time span of 11 years (2007–2017). • We built panel data with 3,781 Spanish construction companies' economic and accident data. • We have put the greatest effort into following a refined and precise methodology for analyzing our data. We checked if the results could be affected by an endogeneity problem using a dynamic GMM panel estimator. And we conducted the Fieller test to check whether a U-shaped relationship exists between accidents and profitability. • Our results show that profitability increases while accidents rise. This relationship just changes when a high level of the accident rate is reached, in this case, the company's profitability starts to decrease. • This study's results have practical implications, emphasizing the need for proactive measures to address the high incidence of accidents and protect the well-being of workers. • Regarding the results, we provide some possible actions to address the construction sector's high accident rate. Occupational accidents have significant implications for a company's human resources and productivity. However, limited understanding exists regarding the effects of high accident rates on a company's economic results. Previous studies examining the relationship between accident rates and economic performance found mixed evidence. This paper investigates this relationship within the Spanish construction sector, which stands out among the industries with the highest accident rates. Our first hypothesis posits that the accident rate has a linear and negative effect on a company's economic performance. Alternatively, our second hypothesis suggests that the impact is not linear and varies based on the level of accidents, with higher rates leading to a more rapid decline in profitability. We used regression analyses incorporating pooled, random, and fixed-effect estimators while controlling for endogeneity using dynamic panel data estimation. We employed the U test and the Fieller test to verify whether a nonlinear relationship exists. Contrary to our first hypothesis, our findings show that the accident rate alone does not reduce a company's profitability across all levels of accidents. However, supporting our second hypothesis, we observe an inverted U-shaped relationship between accidents and profitability. This result suggests that there exists a level of accident rate associated with a maximum in profitability, beyond which profitability begins to decline. This study's results have practical implications, emphasizing the need for proactive measures to address the high incidence of accidents and protect the well-being of workers. [ABSTRACT FROM AUTHOR]

The nexus between corporate environment, social, and governance (ESG) performance and the consequent financial performance have been extensively explored in the literature. However, little is known whether the investment in ESG endeavors has any implication for the cost of capital of an enterprise. The present study investigates the impact of ESG performance of top global technology leading firms on their cost of capital. Panel data fixed effects and random effects and generalized method of moment (GMM) regression estimation techniques have been applied to ascertain this relationship during a period of eight years (2010–2017). For a deeper insight, we segregate the cost of capital into the cost of equity and cost of debt. The empirical outcomes reveal that ESG performance is positively associated with both measures of the cost of capital i.e., cost of equity and cost of debt. It suggests that socially responsible top global technology leaders bear a higher cost of capital as investors perceive ESG as an additional financial burden and do not treat ESG costs as a value-added factor. Hence, corporate managers shall rationalize investment in ESG undertakings to curtail their cost of capital. Based on these findings, the policy prescriptions are discussed for the concerned stakeholders. [ABSTRACT FROM AUTHOR]

The generalized method of moments (GMM) is an important estimation procedure in many areas of economics and finance, and it is well known that this estimation is highly sensitive to the presence of outliers and influential observations. Case-deletion diagnostic has been studied in GMM estimation; however, it is surprised that local influence analysis is under explored. To this end, a local influence method is proposed to assess the effect of minor perturbation on GMM estimation. The local diagnostic measures of GMM estimators under the perturbations of empirical distribution and moment condition are derived to study the joint influence of observations. The obtained results are applied to efficient instrumental variable estimation and dynamic panel data model. Two real data sets are used for illustration, and a simulation study is conducted to examine the effectiveness of the proposed methodology. The advantage of local influence method is analyzed in detail through comparison with the case-deletion method. [ABSTRACT FROM AUTHOR]

This paper is a first look of Covid-19's effect on the alpha and beta of a US stock exchange traded fund. It uses the efficient market hypothesis and the J-test of non-nested hypotheses to identify a reasonable choice of Covid-19 data for estimating CAPM regressions. Obtained through the generalized method of moments in a panel data analysis, a reasonable choice is Covid-19 spread's unanticipated severity. Rising unanticipated severity significantly reduces the alphas and betas of mid-cap and small-cap ETFs but not large-cap and sector & speciality ETFs. Hence, retail investors should not market time or panic liquidate, especially when successful vaccination development is likely in the near future. [ABSTRACT FROM AUTHOR]

This study empirically investigates the possible role of institutional quality in absorbing foreign direct investment (FDI) flows' spillovers for growth in a group of Arab countries. The analysis is performed by employing system GMM estimation in panel data comprising 11 Arab countries over the period 1988–2012. It develops overall indexes of doing business and economic freedom indicators using the principal components analysis (PCA) as weights. The study finds that the quality of institutions plays an important role in enhancing economic growth via indirect impact by absorbing spillovers of FDI inflows. On the one hand, the study reveals that greater macroeconomic stability and financial development have a positive influence on growth. The results of this study have several implications for policy makers. [ABSTRACT FROM AUTHOR]

This paper examines the moments properties in frequency domain of the class of first order continuous-time bilinear processes (COBL(1; 1) for short) driven by a stochastic differential equation defined by a linear drift and certain diffusion processes with time-varying (resp. time-invariant) coefficients. So, we used the associated evolutionary (or timevarying) transfer functions to study the structure of second-order of the process and its powers. In particular, for timeinvariant case, an expression of the moments of any order are given as well as some moments properties of special cases. As a consequence, it is observed however, that for this class explicit statistical inference is feasible. So and based on these results we are able to estimate the unknown parameters involved in model via the so-called generalized method of moments (GMM). This method is robust to the misspecification of likelihood functions. However, it suffers from the ad hoc choice of moment conditions and must presume the existence of arbitrary population moments, and the chisquare specification test of the overidentifying restrictions is subject to severe overrejection bias. In end, the GMM method is illustrated by a Monte Carlo study and applied to modelling two foreign exchange rates of Algerian Dinar against U:S:􀀀Dollar (USD=DZD) and against the single European currency Euro (EUR=DZD). [ABSTRACT FROM AUTHOR]

The impact of external financing on the economies of developing countries is still a subject of debate among economists and policy makers. The objective of this paper is to contribute to this debate by shedding light on the interaction between foreign direct investment (FDI) and external debt. To this end, we begin by formulating an overlapping generation growth model that integrates a banking sector and find two complementary results. First, we show that external financing boosts investment projects and accelerates the dynamic of capital accumulation and economic growth. The second one mitigates this channel by showing two opposite indirect effects of external debt and FDI. Indeed, while external debt financing increases the vulnerability to a bank run that generates a recessionary impact on economic growth, FDI attenuates this recessionary impact and plays the role of a shock absorber. We empirically confirm these results for 67 developing countries over the period 1972–2015 using the GMM estimation of growth models and panel‐logit models to predict the determinants of banking crises. Hence, this study provides a comprehensive assessment of developing countries' involvement in financial globalization and offers recommendations for their future international economic policies. [ABSTRACT FROM AUTHOR]

This paper examines the role that the level and changes in economic freedom play in promoting quality of life in Africa over the period 1985–2016. It develops a composite index for quality of life to capture the different dimensions of quality of life. Employing the generalised method of moments (GMM) estimation technique, the results indicate a positive effect of economic freedom on the quality of life. However, change in economic freedom has an inverse relationship with the quality of life in Africa. The GDP growth and foreign aid have positive effects on the quality of life index and its various indicators. The findings highlight the need for African countries to establish fiscal and monetary policies suitable for improving economic freedom. It also emphasizes the need for African countries to reduce international trade barriers and open up African economies to foreign trade. This will bring about increased economic growth and improved quality of life. [ABSTRACT FROM AUTHOR]

The New Keynesian Phillips Curve (NKPC), a fast-evolving model developed, describes the relationship between inflation and unemployment. The model wields several advantages including its development from micro-foundations, the inclusion of future expectations in modeling inflation thus makes monetary policy systematic and its ability to replicate the inflation dynamics found in data. Despite its interesting attributes, result obtained from countries such as the USA, EU countries and South Africa amongst others show that the model has significant setbacks including its somewhat inability to replicate the actual relationship between inflation and economic output, the overstating role of expectations in price setting, and the relative importance of lagged inflation in the model. To test its performance for Nigeria, which is nonexistent, this study is developed. It employs the Hybrid- NKPC for Nigeria using a quarterly dataset from 2000Q1 -2018Q4. The time frame is chosen due to the availability of data. The NKPC model relates current inflation to future expected inflation and the output gap. The H-NKPC is an extension of the basic NKPC model with the inclusion of the lagged inflation in the model, also developed from micro-foundations. In the estimation of H-NKPC, two sets of results are obtained, first using the detrended output and second using marginal cost proxied by share of labor compensation in income. Results are obtained using Generalized Methods of Moments (GMM). In the first case, using detrended output results strongly support the importance of forward-looking factors, the need for the lagged inflation but the output gap is not statistically significant as a driver of inflation. In the second case using marginal costs, similar results are obtained. That is, both future expected and lagged inflation are statistically significant, but with the real variable that is, the marginal cost is statistically insignificant. Thus, the result lends support to H-NKPC which implies that lagged inflation is a significant part of inflation determination in Nigeria. These results suggest the dominant price-setting behavior is forward-looking. Furthermore, neither real marginal costs nor output gap is found statistically significant. As empirical evidence suggests, changes in real economic activities are the relevant determinant of inflation, thus different perspectives on the output gap such as the use of lagged marginal costs or growth rate of marginal costs may suffice. [ABSTRACT FROM AUTHOR]

Given the high resilience of the Central and Eastern Europe (CEE) banking sectors during the last financial crisis and their major role in the CEE region in financing the economy and supporting the high growth rates achieved there, our paper investigates the determinants of banking profitability in the CEE banking sectors based on a Generalized Method of Methods (GMM) approach using data between 2009 and 2018. We have selected determinants from the macroeconomic factors and from the financial-banking specific factors using a two-step GMM method. Our findings demonstrate that unemployment rate, inflation, budget balance, non-governmental credit, non-performing loan rates, concentration rate and capitalization rate negatively impact on the banking profitability in the CEE banking sectors. According to these findings, some policy recommendations were elaborated. [ABSTRACT FROM AUTHOR]

The current study aims to evaluate the impact of working capital components on the financial performance of Indian pharmaceutical companies. Moreover, it aims to analyze working capital among small, medium and large firms. The study uses a panel data of 82 pharmaceutical companies for the period from 2008 to 2017. Generalized Method of Moment (GMM) model is used for estimating the results. Findings show that there is a significant difference in managing working capital among small, medium and large firms. Furthermore, it is found that number of days’ collection period, number of days’ payable period and number of days’ inventory holding period positively impact the financial performance of Indian pharmaceutical companies measured by return on assets and net operating margin. Whereas, cash conversion cycle has a negative impact on return on assets, net operating margin and Tobin’s Q.

In most developed countries, high growth firms (HGFs) are disproportionately responsible for net job creation, yet there is little information about how well such firms sustain their performance over time. Using GMM on a panel of 79,200 Romanian SMEs from 2000 to 2012, this paper evaluates the extent to which HGFs register stable and sustained growth over time, accounting for a variety of definitions for "high growth" that have been used in academic and policy literatures. Our results indicate that high growth SMEs are unable to maintain high growth rates for long, but do register lower volatility in growth rates and higher chances of survival. Identification of HGFs and results regarding growth volatility and persistence vary significantly with the specific definition of "high growth" used, as well as with the specific variable used to measure growth (e.g., revenue, employees, profit, productivity). Our findings have direct implications for growth policies and programs that depend on identifying HGFs. [ABSTRACT FROM AUTHOR]

The conventional model of immigrant earnings does not account for the correlation of outcomes across immigrant ethnic networks. We apply a spatial autoregressive network approach to account for the spill‐over effects of migrant ethnic group economic resources and labour market outcomes. We employ unit‐record data across 10 years for New Zealand, a major immigrant‐receiving country. By applying the generalized method of moment (GMM) estimation, we address endogeneity of the spatial network variable. Results confirm strong positive associations of earnings with both ethnic concentration and networks of resources. The analytically enhanced approach provides opportunities for new research on the determinants of immigrant earnings. [ABSTRACT FROM AUTHOR]

The recent pandemic and aftermath debate regarding bank interest margins deserve special attention and have become policy dialogue in emerging economies. However, the previous literature's findings were largely inconclusive and ignored influential variables such as the impact of default risk on bank interest margins. Using a two-step system GMM estimation considering 32 Bangladeshi commercial banks from 2000 to 2022, we produce robust evidence that higher regulatory capital restrictions reduce the bank interest margin, while increased default risk induces the bank interest margin. The impact intensity during the COVID pandemic is higher than in the pre-COVID period. Moreover, we find the synergy effect of regulatory capital and default risk assists in reducing the bank interest margin. Bank margin persistently fell during the capital market crash period, whereas it rose in the financial crisis period. We cast several robustness tests to confirm our main findings. These findings could generate important implications for bank stakeholders and policymakers., Competing Interests: The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper., (© 2024 The Authors.)

I analyze the effect of inequality on growth over different time-frames. In a large cross-country dataset for the period 1950-2007 I find evidence of a short-run (5-year periods) and medium-run (10-year periods) inverse-U relationship between inequality and growth. In the long-run (20-year periods), however, inequality has a negative effect on growth in poor countries, and a positive effect in rich ones. Finally, in the 37-year period (1970-2007) higher inequality is associated with a lower rate of growth. Thus, while some (but not much) inequality is good for growth, the negative effect of inequality on growth becomes dominant over longer time-frames.