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Total Articles 82 - 90 of 6582 | Total Books 1 | Total Conference Proceeding 81

The Effect of Exchange Rate Fluctuations on Economic Growth Considering the Level of Development of Financial Markets in Selected Developing Countries

Author(s):Mehdi Basirat --- Arezoo Nasirpour --- Alireza Jorjorzadeh
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 517-528
This study aimed to investigate the effect of exchange rate fluctuations on economic growth considering the rate of development of financial markets in developing countries over the period 1986-2010. The effects of variables such as trading volume, inflation, and production of the previous period on economic growth have been studied as well. The results obtained by analyzing  panel data of 18 countries show that the effect of financial development on economic growth as well as the effect of exchange rate fluctuation on economic growth are negative and significant. On the other hand, the mutual effect of exchange rate fluctuations and financial development on economic growth is positive, but the effect in the studied countries is so small that is not statistically significant.

An Early Warning System for Turkey: The Forecasting Of Economic Crisis by Using the Artificial Neural Networks

Author(s):Fuat Sekmen --- Murat Kurkcu
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 529-543
An economic crisis is typically a rare kind of an event but it impedes monetary stability, fiscal stability, financial stability, price stability, and sustainable economic development when it appears. Economic crises have huge adverse effects on economic and social system. This study uses an artificial neural network learning paradigm to predict economic crisis events for early warning aims. This paradigm is being preferred due to its flexible modeling capacity and can be applied easily to any time series since it does not require prior conditions such as stationary or normal distribution. The present article analyzes economic crises occurred in Turkey for the period 1990-2011. The main question addressed in this paper is whether currency crises can be estimated by using artificial neural networks.

Monetary Policy Shocks and Exchange Rate Volatility in Nigeria

Author(s):Babatunde Wasiu Adeoye --- Olufemi Muibi Saibu
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 544-562
This paper analysed the effects of monetary policy shocks using changes in various monetary policy instruments on exchange rate volatility in Nigeria. This paper investigates the relationship between exchange rate volatility and monetary policy shocks in Nigeria. The paper applies the classical ordinary least square to examine the short-run monetary policy determinants of exchange rate volatility in Nigeria. Also, the error correction mechanism model was estimated after establishing the long-run interaction among set of incorporated variables using the Engle-Granger approach. The results from the paper show that both real and nominal exchange rates in Nigeria have been unstable during the period under review. In the short, the variation in the monetary policy variable explains the movement/behaviour of exchange rate through a self-correcting mechanism process with little or no intervention from the monetary authority (CBN). In addition, the results from the causality tests between the exchange rate volatility and monetary policy variables showed that there is a causal link between the past values of monetary policy variables and the exchange rate. This is obvious in the case of the past value of the interest rates. Such that, a change in the level of previous values of monetary policy variables causes exchange rate volatility. Finally, the paper reiterated and concluded that inflation rate, reserves, interest rate and money supply depreciate and cause volatility in nominal exchange rate which further reinforce other findings that monetary policy is crucial to exchange rate management in Nigeria.

Stock Market Integration in West African Monetary Zone: A Linear and Nonlinear Cointegration Approach

Author(s):Daniel Agyapong
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 563-587
The capital market plays a significant role in the development of an economy and hence an important determinant of regionalisation and single currency area formation. Stock and other capital markets have been found to predict and promote economic activities. The equity markets have been found to predict recession. As the Anglophone countries in West Africa prepare to introduce a second common currency in the region, it is imperative to assess their readiness by analysing the nature of their capital markets. The paper investigated if stock markets in the zone are integrated, since it is being suggested as the basis for common currency.  Both linear and nonlinear cointegration methods were employed. The results from the linear cointegration indicated that the only active stock markets (Ghana Stock Exchange and Nigeria Stock Exchange) in the region are not integrated. However, the linear method showed a bleak sign of integration. A fractional integration method showed that whereas the Ghana Stock Exchange has infinite shock duration, the Nigeria Stock Exchange is long-lived.  In effect, the markets are more of segmented than integrated, and hence appropriate for risk diversification. It is suggested that the countries work towards harmonising the capital markets through cross listing and adopting common capital market policies.

Growth Effects of Health Inputs and Outcomes in Sub-Sahara African Countries (1995-2011)

Author(s):Apanisile Olumuyiwa Tolulope -- Akinlo Taiwo
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 705-714
The study examined the contribution of health inputs and outcomes to growth process in the Sub-Saharan Africa. Panel data of 30 countries from the sub-region from 1995 to 2011was used in a dynamic Generalized Method of Moment (GMM) modeling framework. The study used secondary school enrolment and government expenditure on health as health inputs while child mortality rate was used as a proxy for health outcomes. Results showed that education has statistically significant positive effect on economic growth while both government expenditure on health and mortality rate have statistically significant negative effects. The coefficients of the variables revealed that health (reduction in child mortality rate) is relatively more effective in promoting economic growth than education as an input in the growth process as the effects of health overwhelmingly supersedes the effects of education in the dynamic endogenous growth model estimated. This implies while both education and health care are crucial and important in the growth process, in a situation of resources constraints, emphasis should first be placed on adequate and efficient healthcare delivery and then provision of higher education

Integration and Dynamic Linkages of the Indian Stock Market with Bric - An Empirical Study

Author(s):Ranjan Dasgupta
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 715-731
The interrelationships, interdependencies, integration, and dynamic linkages in between countries, regions including BRIC, country-region, and developing-developed stock markets had been thoroughly researched in the literature. This study aims at investigating above relationships both in short and long-run with special reference to India. It undertakes daily closing values of the BRIC indices from 1st January 2003 to 31st December 2012. This study has used Jarque-Bera test, and ADF and PP tests for judging the normality and stationarity of the data series. Based on the above results this study undertakes Johansen and Juselius’s and Engle and Granger’s cointegration tests, and pairwise Granger causality tests to investigate short and long-run interrelationships and integration of the BRIC stock markets. To make this study more reliable the Vector Autoregression in the form of Impulse response functions and Variance Decomposition analysis are also used. This study has found that they are non-normal and non-stationary at level, but integrated of order 1 [i.e., I(1)]. It has found only one cointegration, i.e., long-run relationships and also short-run bidirectional Granger relationships in between the Indian and Brazilian stock markets. Also, the Chinese stock market Granger causes the Brazilian stock market which in turn has a causal effect on the Russian stock market. Based on the above results, it is found that the Indian stock market has strong impact on Brazilian and Russian stock markets. The interdependencies (mainly on India and China) and dynamic linkages are also evident in the BRIC stock markets. Overall, this study has found that BRIC stock markets are the most favourable destination for global investors in the coming future and among the BRIC the Indian stock market has the dominance.

The Impacts of the Quality of the Environment and Neighbourhood Affluence on Housing Prices: A Three-Level Hierarchical Linear Model Approach

Author(s):Chun-Chang Lee --- Hui-Yu Lin
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 588-606
This paper employs a three-level hierarchical linear model (HLM) to examine the impacts that the quality of the environment and neighbourhood affluence have on housing prices. The empirical results suggest that there are significant variations in the average housing price for different neighbourhoods and administrative districts. The impact of building characteristics on housing prices is subject to the moderating effects of the characteristic variables of different levels. The quality of the environment mitigates the impact of age on the decline of housing prices, and neighbourhood affluence has a positive influence with regard to the impact of age on housing prices across different levels.

The Effect of Corruption on Firm Growth: Evidence from Firms in Turkey

Author(s):Hasan Ayaydın --- Pınar Hayaloglu
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 607-624
To our knowledge, there is no micro-level study paying attention to the influence of corruption on firm growth. We aim to fill this gap in the literature. This paper therefore contributes to the limited literature on the link between corruption and firm growth in a single country, Turkey. To estimate the relationship between firm growth and corruption, we analyze a sample of 41 firms from manufacturing firms in Turkey, covering the period from 2008 to 2011 by using static panel techniques. The study find evidence that the effect of corruption level, profitability and financial leverage on the growth of the firms is significantly positive in all case, but financial risk rating is negative. We find specifically a significantly positive relation between the growth of private firms and corruption level. This leads that corruption could increase economic development, mainly because illegal practices and payments as ?speed money? could surpass bureaucratic delays; the acceptance of bribes in government employees could work as an incentive and increase their efficiency and because corruption is possibly the price people are forced to pay as a result of market failures. The results of this study provide managerial implications for industrial companies from Turkey: Company managers should increase profitability, should reach economies of scale, an optimal capital structure level and reach the optimal level of working capital level due to profitable firms grow faster than other companies. We also suggest that policy-makers improve in public governance quality and the leveling of the playing field for firms in all business sectors to reduce corruption level because firms tend to pay bribes and the time that is wasted on bureaucratic procedures and engage in corrupt practices in an attempt to promote their short-term growth by facilitating transactions in the bureaucratic process.

Mechanisms of the Influence of Human Capital on Economic Growth: A Panel Data Analysis of the CEMAC Region

Author(s):Ongo Nkoa B. Emmanuel --- Vukenkeng Andrew Wujung --- Seppo Martin P. Emmanuel
Journal: Asian Economic and Financial Review
Publisher:
Abstract
| Pages: 625-640
This paper examines the mechanisms through which human capital influences economic growth in the CEMAC region. The effect of human capital on economic growth was estimated using Two Stage Least Square (2SLS) multiple regression model for the individual countries and the method of Generalized Least Square for the whole sub region. The results show that secondary education improves human capital development. A good health system strengthens/increases the quality of capital. Knowledge acquired on the job increases the productivity of the workers and the accumulated human capital significantly impacts positively on the economic growth of the CEMAC region.
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