Pub Date : 2021-02-01DOI: 10.5709/CE.1897-9254.436
Alam Khan, N. Khan, M. Shafiq
The world has been waging a fight against the novel coronavirus (COVID-19) since December 2019. The current coronavirus crisis is a catastrophe affecting billions of families worldwide. So far, COVID-19 has wreaked havoc across the globe: by slowing down economic growth; decreasing global trade; hurting health sector; increasing unemployment and underemployment; reducing FDI and hurting the tourism sector. This study investigates the economic costs of COVID-19. By using descriptive analysis, this study shows that the major economic variables, such as economic growth, global trade, health sector, unemployment and underemployment, foreign direct investment and travel and tourism sector have significantly affected by COVID-19.
{"title":"The Economic Impact of COVID-19 from a Global Perspective","authors":"Alam Khan, N. Khan, M. Shafiq","doi":"10.5709/CE.1897-9254.436","DOIUrl":"https://doi.org/10.5709/CE.1897-9254.436","url":null,"abstract":"The world has been waging a fight against the novel coronavirus (COVID-19) since December 2019. The current coronavirus crisis is a catastrophe affecting billions of families worldwide. So far, COVID-19 has wreaked havoc across the globe: by slowing down economic growth; decreasing global trade; hurting health sector; increasing unemployment and underemployment; reducing FDI and hurting the tourism sector. This study investigates the economic costs of COVID-19. By using descriptive analysis, this study shows that the major economic variables, such as economic growth, global trade, health sector, unemployment and underemployment, foreign direct investment and travel and tourism sector have significantly affected by COVID-19.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"220 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2021-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79822484","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
COVID-19 poses an unprecedented threat to components of global business cycles including stock markets, industrial production and employment. This study investigated its impact on stock markets of 24 oil producing COVID-19-hit economies in North America, South America, Europe, Asia, Oceania and Africa. It examined the nature of asymmetry in the business cycles of the sampled countries and the impact of COVID-19 on the asymmetry. Switching regression techniques were estimated with data covering the period from October 1, 2019 to April 14, 2020. The results confirmed the presence of negative asymmetry in stock market cycles in 54.2% of the sampled countries, out of which 38.5%, 46.2% and 15.4% are high, middle and low-middle income countries, respectively. This is significantly connected to the COVID-19 pandemic for 29.2% of the sample. The expected duration of being in the state of low stock market performance, due to COVID-19, reduces with levels of countries’ income, if regimes are dependent. Opposite was observed if regimes are independent. Hence, the negative impact of COVID-19 on stock markets in lower-income countries will linger compared to higher-income countries. Reducing COVID-19-associated risks will go a long way to revive investors’ confidence in the market and help to restart the engine of economic recovery in the sampled countries.
{"title":"COVID-19: Putting Stock Markets Back on Recovery among the Crude Oil Producing Economies","authors":"S. Olakojo, A. Onanuga, Olaronke T. Onanuga","doi":"10.5709/ce.1897-9254.43","DOIUrl":"https://doi.org/10.5709/ce.1897-9254.43","url":null,"abstract":"COVID-19 poses an unprecedented threat to components of global business cycles including stock markets, industrial production and employment. This study investigated its impact on stock markets of 24 oil producing COVID-19-hit economies in North America, South America, Europe, Asia, Oceania and Africa. It examined the nature of asymmetry in the business cycles of the sampled countries and the impact of COVID-19 on the asymmetry. Switching regression techniques were estimated with data covering the period from October 1, 2019 to April 14, 2020. The results confirmed the presence of negative asymmetry in stock market cycles in 54.2% of the sampled countries, out of which 38.5%, 46.2% and 15.4% are high, middle and low-middle income countries, respectively. This is significantly connected to the COVID-19 pandemic for 29.2% of the sample. The expected duration of being in the state of low stock market performance, due to COVID-19, reduces with levels of countries’ income, if regimes are dependent. Opposite was observed if regimes are independent. Hence, the negative impact of COVID-19 on stock markets in lower-income countries will linger compared to higher-income countries. Reducing COVID-19-associated risks will go a long way to revive investors’ confidence in the market and help to restart the engine of economic recovery in the sampled countries.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"37 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2021-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77235766","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-02-01DOI: 10.5709/CE.1897-9254.432
Gurmeet Singh, Muneer Shaik
The COVID-19 pandemic, declared on March 11, 2020 by the World Health Organisation (WHO), has had a severe economic and financial impact on every economy around the world. This paper aims to analyze the short-term impact of COVID-19 on global financial stock market indices. We study the impact of six different WHO announcements regarding COVID-19 on five different sectors (Pharma, Healthcare, Information Technology, Hotel & Airline) based on the indices of three different economies (World, Developed and Emerging economy). We also study the movement of stock prices and volume of nine different global stock market indices (classified as developed & emerging) based on the number of new cases and deaths due to COVID-19. The study’s findings suggest that there is a significant effect of COVID-19 on global financial stock markets. However, the effect is varied for developed and emerging economies.
{"title":"The Short-Term Impact of COVID-19 on Global Stock Market Indices","authors":"Gurmeet Singh, Muneer Shaik","doi":"10.5709/CE.1897-9254.432","DOIUrl":"https://doi.org/10.5709/CE.1897-9254.432","url":null,"abstract":"The COVID-19 pandemic, declared on March 11, 2020 by the World Health Organisation (WHO), has had a severe economic and financial impact on every economy around the world. This paper aims to analyze the short-term impact of COVID-19 on global financial stock market indices. We study the impact of six different WHO announcements regarding COVID-19 on five different sectors (Pharma, Healthcare, Information Technology, Hotel & Airline) based on the indices of three different economies (World, Developed and Emerging economy). We also study the movement of stock prices and volume of nine different global stock market indices (classified as developed & emerging) based on the number of new cases and deaths due to COVID-19. The study’s findings suggest that there is a significant effect of COVID-19 on global financial stock markets. However, the effect is varied for developed and emerging economies.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"381 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2021-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75518960","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-01-01DOI: 10.5709/CE.1897-9254.427
Thareeq Adhi Chandra, R. Handoyo
{"title":"Determinants of Foreign Direct Investment in 31 Asian Countries for the 2002-2017 Period","authors":"Thareeq Adhi Chandra, R. Handoyo","doi":"10.5709/CE.1897-9254.427","DOIUrl":"https://doi.org/10.5709/CE.1897-9254.427","url":null,"abstract":"","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"4 1","pages":"563-578"},"PeriodicalIF":2.1,"publicationDate":"2020-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"90628663","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-30DOI: 10.5709/ce.1897-9254.308
Heti Suryani Fitri Sulaeman, Sri Mulyantini Moelyono, Jubaedah Nawir
This study analyzes internal and external factors that affect banking efficiency by using quarterly data for 2013-2017. The sample includes conventional and Islamic commercial banks. Hypothesis testing uses the Tobit regression model. The results show that the loan to deposit ratio/ financing to deposit ratio (LDR/FDR), the net interest margin/net operating margin (NIM/NOM), the capital adequacy ratio (CAR), and economic growth have a significantly positive effect on the efficiency of commercial banks. The NIM/NOM, the BI-rate, and the inflation have no effect on the efficiency of commercial banks. According to another analysis, factors that influence the efficiency of the results show that in conventional commercial banks, the LDR, the CAR, economic growth, and inflation have a significantly positive effect on the efficiency of conventional commercial banks. In contrast, the NIM has a significantly negative effect. Meanwhile, for Sharia commercial banks, the FDR, NPF, the CAR, economic growth and inflation have a significantly positive effect, and the BI-rate has a significantly negative effect.
{"title":"Determinants of Banking Efficiency for Commercial Banks in Indonesia","authors":"Heti Suryani Fitri Sulaeman, Sri Mulyantini Moelyono, Jubaedah Nawir","doi":"10.5709/ce.1897-9254.308","DOIUrl":"https://doi.org/10.5709/ce.1897-9254.308","url":null,"abstract":"This study analyzes internal and external factors that affect banking efficiency by using quarterly data for 2013-2017. The sample includes conventional and Islamic commercial banks. Hypothesis testing uses the Tobit regression model. The results show that the loan to deposit ratio/ financing to deposit ratio (LDR/FDR), the net interest margin/net operating margin (NIM/NOM), the capital adequacy ratio (CAR), and economic growth have a significantly positive effect on the efficiency of commercial banks. The NIM/NOM, the BI-rate, and the inflation have no effect on the efficiency of commercial banks. According to another analysis, factors that influence the efficiency of the results show that in conventional commercial banks, the LDR, the CAR, economic growth, and inflation have a significantly positive effect on the efficiency of conventional commercial banks. In contrast, the NIM has a significantly negative effect. Meanwhile, for Sharia commercial banks, the FDR, NPF, the CAR, economic growth and inflation have a significantly positive effect, and the BI-rate has a significantly negative effect.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"38 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"81108274","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-30DOI: 10.5709/CE.1897-9254.302
Z. Grdić, M. Gregorić, M. Nižić
In Croatia, tourism is one of the most important economic activities, accounting for 2.1% of total tourist flows in the European Union and 18% of the total Croatian gross domestic product. Economic development and tourism flows are influenced by the increasing intensity of climate change, leading to a need to adapt to new business conditions to minimize the negative and maximize the positive effects. The objective of the current study is to empirically research the role of tourism in the Croatian economy for the period 2004-2015 and the impact of climate change on tourist flows. To investigate experts’ opinions on the impact of climate change on Croatian tourism, this study employs a qualitative approach to obtain comprehensive insights into tourism, climate change and scientific research. By conducting in-depth interviews with experts and identifying the challenges posed by the current impact of climate change on Croatian tourism, the authors gain deeper insights into tourism development and climate change that reflect the current situation in Croatia. The results indicate that climate change will not have a negative impact on Croatian tourism in the near future. However, after 2050, a number of adaptation measures will be required to maintain the current tourism status.
{"title":"Investigating the Influence of Tourism on Economic Growth and Climate Change – The Case of Croatia","authors":"Z. Grdić, M. Gregorić, M. Nižić","doi":"10.5709/CE.1897-9254.302","DOIUrl":"https://doi.org/10.5709/CE.1897-9254.302","url":null,"abstract":"In Croatia, tourism is one of the most important economic activities, accounting for 2.1% of total tourist flows in the European Union and 18% of the total Croatian gross domestic product. Economic development and tourism flows are influenced by the increasing intensity of climate change, leading to a need to adapt to new business conditions to minimize the negative and maximize the positive effects. The objective of the current study is to empirically research the role of tourism in the Croatian economy for the period 2004-2015 and the impact of climate change on tourist flows. To investigate experts’ opinions on the impact of climate change on Croatian tourism, this study employs a qualitative approach to obtain comprehensive insights into tourism, climate change and scientific research. By conducting in-depth interviews with experts and identifying the challenges posed by the current impact of climate change on Croatian tourism, the authors gain deeper insights into tourism development and climate change that reflect the current situation in Croatia. The results indicate that climate change will not have a negative impact on Croatian tourism in the near future. However, after 2050, a number of adaptation measures will be required to maintain the current tourism status.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"2 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85196067","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-30DOI: 10.5709/ce.1897-9254.307
H. I. Hussain, A. Ali, Hassanudin Mohd Thas Thaker, Mohsin Ali
Board composition is central to the worldwide corporate governance reforms that have taken place in recent years. The strong emphasis on director independence and board leadership is now part of all corporate governance regimes, including the regimes which has been introduced in Malaysia. It is the effectiveness of such provisions in the Malaysian business environment that provides the motivation for this paper. The literature shows mixed findings on the issues of board independence and board leadership. Our paper studies the role of directors with family connections and its impact on financial outcomes. We find that firms with a high presence of family related directors exhibit superior accounting profitability. However, such dominance is negatively viewed by the market (firm performance based on market measures), indicating that markets tend to perceive that domination of family members on the board could potentially lead to expropriation of wealth at the expense of other shareholders. Our results are supported by additional robustness tests. The findings provide interesting insights into the governance mechanisms of firms in an emerging market and its consequences for investor perceptions. Further implications are also discussed.
{"title":"Firm Performance and Family Related Directors: Empirical Evidence from an Emerging Market","authors":"H. I. Hussain, A. Ali, Hassanudin Mohd Thas Thaker, Mohsin Ali","doi":"10.5709/ce.1897-9254.307","DOIUrl":"https://doi.org/10.5709/ce.1897-9254.307","url":null,"abstract":"Board composition is central to the worldwide corporate governance reforms that have taken place in recent years. The strong emphasis on director independence and board leadership is now part of all corporate governance regimes, including the regimes which has been introduced in Malaysia. It is the effectiveness of such provisions in the Malaysian business environment that provides the motivation for this paper. The literature shows mixed findings on the issues of board independence and board leadership. Our paper studies the role of directors with family connections and its impact on financial outcomes. We find that firms with a high presence of family related directors exhibit superior accounting profitability. However, such dominance is negatively viewed by the market (firm performance based on market measures), indicating that markets tend to perceive that domination of family members on the board could potentially lead to expropriation of wealth at the expense of other shareholders. Our results are supported by additional robustness tests. The findings provide interesting insights into the governance mechanisms of firms in an emerging market and its consequences for investor perceptions. Further implications are also discussed.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"32 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"73027930","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-30DOI: 10.5709/ce.1897-9254.306
A. Hadi, E. H. Yap, Zalina Zainudin
The study is carried out with the objective of testing the efficient market hypothesis (EMH) at the semistrong form level. As such, the study employs two publicly available data variables – the exchange rate (RM/USD) and short-term interest rate as proxied by the overnight policy rate (OPR). The extent to which these variables influenced the performance of Bursa Malaysia (KLCI) over the past 35 years, from January 1980 to June 2015, is examined. Using monthly data, the entire study period is divided into three subperiods – the full sample period, the sample period that excludes the duration of capital control and the sample period of FBMKLCI (from July 2009 to June 2015). Deploying the Johansen-Juselius cointegration test, the study shows the presence of a long-run equilibrium relationship between KLCI and the two control variables over the full sample period and sample period, excluding the period of capital control. From the long-run regression, the effect of OPR on Bursa Malaysia is consistent over all three subperiods. This is a clear indication that the interest rate regime has a significant influence on Bursa Malaysia. Interestingly, there is no equilibrium relationship, and dynamic relationships exist between FBMKLCI and the two explanatory variables over the FBMKLCI sample period. These findings support our notion that Bursa Malaysia is unquestionably semistrong form efficient. It is now evident that FBMKLCI is the most exogenous variable of all.
{"title":"The Effects of Relative Strength of USD and Overnight Policy Rate on Performance of Malaysian Stock Market – Evidence from 1980 through 2015","authors":"A. Hadi, E. H. Yap, Zalina Zainudin","doi":"10.5709/ce.1897-9254.306","DOIUrl":"https://doi.org/10.5709/ce.1897-9254.306","url":null,"abstract":"The study is carried out with the objective of testing the efficient market hypothesis (EMH) at the semistrong form level. As such, the study employs two publicly available data variables – the exchange rate (RM/USD) and short-term interest rate as proxied by the overnight policy rate (OPR). The extent to which these variables influenced the performance of Bursa Malaysia (KLCI) over the past 35 years, from January 1980 to June 2015, is examined. Using monthly data, the entire study period is divided into three subperiods – the full sample period, the sample period that excludes the duration of capital control and the sample period of FBMKLCI (from July 2009 to June 2015). Deploying the Johansen-Juselius cointegration test, the study shows the presence of a long-run equilibrium relationship between KLCI and the two control variables over the full sample period and sample period, excluding the period of capital control. From the long-run regression, the effect of OPR on Bursa Malaysia is consistent over all three subperiods. This is a clear indication that the interest rate regime has a significant influence on Bursa Malaysia. Interestingly, there is no equilibrium relationship, and dynamic relationships exist between FBMKLCI and the two explanatory variables over the FBMKLCI sample period. These findings support our notion that Bursa Malaysia is unquestionably semistrong form efficient. It is now evident that FBMKLCI is the most exogenous variable of all.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"126 2 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"91054506","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-30DOI: 10.5709/ce.1897-9254.304
S. Rosefielde
In the most recent decade, the European Union has shown itself to be less robust than globalists imagined. Globalists believed that supranationality was weatherproof – that it would always outperform national alternatives and would survive adversity. Economic stagnation and Brexit belied these expectations. This essay investigates one aspect of the EU’s supranational plight: incompatible goals and the difficulty of mutual accommodation, especially during hard times. EU supranationalists contend that the shared dreams assure harmonious results, but experience reveals that supranational government is shakier than advocates claim because shared ideals and benefits have not been enough for members to put aside conflicting national interests. These rivalries do not doom the European Union’s globalizing project, but they do expose the vulnerabilities of its premises. Supranational union is proving to be unsatisfactory to both many centralizers demanding “more Europe” and decentralizers insisting on “less Europe”. EU leaders are aware of the problem but are wedded to a one-track, two-speed supranational approach that is destined to fail. A dual-track supranational solution analogous to China’s “one country, two systems” offers a better alternative.
{"title":"Salvaging the EU: Two-Speed or Dual-Track Reform?","authors":"S. Rosefielde","doi":"10.5709/ce.1897-9254.304","DOIUrl":"https://doi.org/10.5709/ce.1897-9254.304","url":null,"abstract":"In the most recent decade, the European Union has shown itself to be less robust than globalists imagined. Globalists believed that supranationality was weatherproof – that it would always outperform national alternatives and would survive adversity. Economic stagnation and Brexit belied these expectations. This essay investigates one aspect of the EU’s supranational plight: incompatible goals and the difficulty of mutual accommodation, especially during hard times. EU supranationalists contend that the shared dreams assure harmonious results, but experience reveals that supranational government is shakier than advocates claim because shared ideals and benefits have not been enough for members to put aside conflicting national interests. These rivalries do not doom the European Union’s globalizing project, but they do expose the vulnerabilities of its premises. Supranational union is proving to be unsatisfactory to both many centralizers demanding “more Europe” and decentralizers insisting on “less Europe”. EU leaders are aware of the problem but are wedded to a one-track, two-speed supranational approach that is destined to fail. A dual-track supranational solution analogous to China’s “one country, two systems” offers a better alternative.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"27 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85143964","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-30DOI: 10.5709/CE.1897-9254.305
F. Andoh, N. Osoro, E. Luvanda
The introduction of the value-added tax (VAT) to replace the sales tax in 1995 was one of the key policy steps undertaken by the government of Ghana (GoG) to further deepen and sustain the efficiency of Ghana’s tax system to boost tax revenue. This study uses quarterly data from 2000 to 2014 and employs dynamic ordinary least squares (DOLS) and Divisia Index approaches to examine the growth of Ghana’s VAT revenues and how this growth is affected by discretionary tax measures. On the whole, the study finds that all of the measures of VAT revenue (total VAT, domestic VAT, and import VAT) have experienced some growth. Growth in total VAT and import VAT is driven strongly by growth in the base, while that of the domestic VAT is driven by both discretionary tax measures and the tax base. Discretionary tax measures are found to have a depressive effect on both total VAT and import VAT revenue growth.
{"title":"Growth Dynamics of Value-Added Tax Revenue in Ghana","authors":"F. Andoh, N. Osoro, E. Luvanda","doi":"10.5709/CE.1897-9254.305","DOIUrl":"https://doi.org/10.5709/CE.1897-9254.305","url":null,"abstract":"The introduction of the value-added tax (VAT) to replace the sales tax in 1995 was one of the key policy steps undertaken by the government of Ghana (GoG) to further deepen and sustain the efficiency of Ghana’s tax system to boost tax revenue. This study uses quarterly data from 2000 to 2014 and employs dynamic ordinary least squares (DOLS) and Divisia Index approaches to examine the growth of Ghana’s VAT revenues and how this growth is affected by discretionary tax measures. On the whole, the study finds that all of the measures of VAT revenue (total VAT, domestic VAT, and import VAT) have experienced some growth. Growth in total VAT and import VAT is driven strongly by growth in the base, while that of the domestic VAT is driven by both discretionary tax measures and the tax base. Discretionary tax measures are found to have a depressive effect on both total VAT and import VAT revenue growth.","PeriodicalId":44824,"journal":{"name":"Contemporary Economics","volume":"62 1","pages":""},"PeriodicalIF":2.1,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"91305605","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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