Pub Date : 2023-01-16DOI: 10.1108/ajems-02-2022-0036
Peterson K. Ozili, Olajide Oladipo, Paul Terhember Iorember
PurposeThis paper investigates the effect of abnormal increase in credit supply on economic growth in Nigeria after controlling for the quality of the legal system, size of central bank asset, banking sector cost efficiency and bank insolvency risk.Design/methodology/approachThe authors employ the generalised method of moments (GMM) regression methodology to estimate the effect of abnormal increase in credit supply on two measures of economic growth in Nigeria.FindingsThe abnormal increase in credit supply has a significant effect on economic growth. Abnormal increase in credit supply increases real gross domestic product (GDP) growth. The abnormal increase in credit supply decreases real GDP per capita during the global financial crisis. The abnormal increase in domestic credit to the private sector has a significant positive effect on GDP per capita when there is strong legal system quality in Nigeria. In contrast, the abnormal increase in domestic credit to the private sector has a significant negative effect on real GDP growth when there is strong legal system quality in Nigeria.Practical implicationsThe abnormal increase in credit supply is ineffective in increasing GDP per capita during crisis years. Policymakers should be cautious in pressuring financial institutions to release an abnormally large amount of credit into the economy particularly during financial crises. Rather, policymakers should encourage financial institutions to supply credit in a sustained manner – not in an abnormal manner –and in a way that supports growth.Originality/valueThe present study contributes to the literature by analysing the effect of abnormal increase in credit supply on economic growth in a developing country context.
{"title":"Effect of abnormal increase in credit supply on economic growth in Nigeria","authors":"Peterson K. Ozili, Olajide Oladipo, Paul Terhember Iorember","doi":"10.1108/ajems-02-2022-0036","DOIUrl":"https://doi.org/10.1108/ajems-02-2022-0036","url":null,"abstract":"PurposeThis paper investigates the effect of abnormal increase in credit supply on economic growth in Nigeria after controlling for the quality of the legal system, size of central bank asset, banking sector cost efficiency and bank insolvency risk.Design/methodology/approachThe authors employ the generalised method of moments (GMM) regression methodology to estimate the effect of abnormal increase in credit supply on two measures of economic growth in Nigeria.FindingsThe abnormal increase in credit supply has a significant effect on economic growth. Abnormal increase in credit supply increases real gross domestic product (GDP) growth. The abnormal increase in credit supply decreases real GDP per capita during the global financial crisis. The abnormal increase in domestic credit to the private sector has a significant positive effect on GDP per capita when there is strong legal system quality in Nigeria. In contrast, the abnormal increase in domestic credit to the private sector has a significant negative effect on real GDP growth when there is strong legal system quality in Nigeria.Practical implicationsThe abnormal increase in credit supply is ineffective in increasing GDP per capita during crisis years. Policymakers should be cautious in pressuring financial institutions to release an abnormally large amount of credit into the economy particularly during financial crises. Rather, policymakers should encourage financial institutions to supply credit in a sustained manner – not in an abnormal manner –and in a way that supports growth.Originality/valueThe present study contributes to the literature by analysing the effect of abnormal increase in credit supply on economic growth in a developing country context.","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2023-01-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43313676","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 : 2023-01-13DOI: 10.1108/ajems-08-2022-0315
Kamel Mouloudj, Ahmed Chemseddine Bouarar
PurposeThe purpose of the present paper is to investigate Algerian medical students' intention to participate in volunteer work during the coronavirus disease 2019 (COVID-19) pandemic.Design/methodology/approachThe authors adopted an extended theory of planned behavior (TPB) framework by integrating the constructs of personal moral norms and perceived risk of COVID-19 and followed a self-administered questionnaire survey to collect data among a convenience sample of medical students (n = 267) in five Algerian universities. The data obtained were analyzed through a hierarchical multiple regression process in which three models were considered.FindingsFindings of this study show that attitude toward volunteering, perceived behavior control (PBC), personal moral norm and subjective norm significantly and positively predicted medical students' intention to engage in volunteer work during the COVID-19 pandemic. However, students' perceived risk of COVID-19 significantly and negatively predicted students' intention to participate in volunteer activities. Moreover, the authors' analyses showed that the extended TPB model explained 75.1% of the variance of intention.Practical implicationsThe findings of this study have implications for understanding medical students' volunteer behavior during health crises. Some implications are provided for the crisis and emergency managers of hospitals and policymakers to attract and recruit enough medical students' volunteers for future waves of COVID-19 or other similar health crises.Originality/valueThis is the first paper from Algeria and one of the few from Africa that identifies predictors of intentions to participate in volunteer activities among medical students.
{"title":"Investigating predictors of medical students' intentions to engagement in volunteering during the health crisis","authors":"Kamel Mouloudj, Ahmed Chemseddine Bouarar","doi":"10.1108/ajems-08-2022-0315","DOIUrl":"https://doi.org/10.1108/ajems-08-2022-0315","url":null,"abstract":"PurposeThe purpose of the present paper is to investigate Algerian medical students' intention to participate in volunteer work during the coronavirus disease 2019 (COVID-19) pandemic.Design/methodology/approachThe authors adopted an extended theory of planned behavior (TPB) framework by integrating the constructs of personal moral norms and perceived risk of COVID-19 and followed a self-administered questionnaire survey to collect data among a convenience sample of medical students (n = 267) in five Algerian universities. The data obtained were analyzed through a hierarchical multiple regression process in which three models were considered.FindingsFindings of this study show that attitude toward volunteering, perceived behavior control (PBC), personal moral norm and subjective norm significantly and positively predicted medical students' intention to engage in volunteer work during the COVID-19 pandemic. However, students' perceived risk of COVID-19 significantly and negatively predicted students' intention to participate in volunteer activities. Moreover, the authors' analyses showed that the extended TPB model explained 75.1% of the variance of intention.Practical implicationsThe findings of this study have implications for understanding medical students' volunteer behavior during health crises. Some implications are provided for the crisis and emergency managers of hospitals and policymakers to attract and recruit enough medical students' volunteers for future waves of COVID-19 or other similar health crises.Originality/valueThis is the first paper from Algeria and one of the few from Africa that identifies predictors of intentions to participate in volunteer activities among medical students.","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2023-01-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45220677","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 : 2022-12-26DOI: 10.1108/ajems-02-2022-0062
Bruvine Orchidée Mazonga Mfoutou, Yuan Xie
PurposeThis study aims to examine the solvency and performance persistence of defined benefit private and public pension plans (DBPPs) in the Republic of Congo.Design/methodology/approachThe authors use the 2 × 2 contingency table approach and the time product ratio (TPR)-based cross-product ratio (CPR) on data covering ten years from 2011 to 2020, with variable funded ratios and excess returns, to determine the solvency and performance persistence of defined benefit pension plans.FindingsThe authors document a lack of solvency and performance persistence in DBPP funds. They conclude that the solvency and performance of DBPP funds are not repetitive. The previous year's private and public defined benefit pension funds’ results do not repeat in the current year. Hence, the current solvency and performance of defined benefit pension funds are not good predictors of future funds' solvency and performance.Originality/valueTo the best of the authors’ knowledge, this study is the first to combine solvency and performance to examine the persistence of defined benefit pension plans in sub-Saharan Africa.
{"title":"Solvency and performance persistence of defined benefit private and public pension plans","authors":"Bruvine Orchidée Mazonga Mfoutou, Yuan Xie","doi":"10.1108/ajems-02-2022-0062","DOIUrl":"https://doi.org/10.1108/ajems-02-2022-0062","url":null,"abstract":"PurposeThis study aims to examine the solvency and performance persistence of defined benefit private and public pension plans (DBPPs) in the Republic of Congo.Design/methodology/approachThe authors use the 2 × 2 contingency table approach and the time product ratio (TPR)-based cross-product ratio (CPR) on data covering ten years from 2011 to 2020, with variable funded ratios and excess returns, to determine the solvency and performance persistence of defined benefit pension plans.FindingsThe authors document a lack of solvency and performance persistence in DBPP funds. They conclude that the solvency and performance of DBPP funds are not repetitive. The previous year's private and public defined benefit pension funds’ results do not repeat in the current year. Hence, the current solvency and performance of defined benefit pension funds are not good predictors of future funds' solvency and performance.Originality/valueTo the best of the authors’ knowledge, this study is the first to combine solvency and performance to examine the persistence of defined benefit pension plans in sub-Saharan Africa.","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2022-12-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48763564","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 : 2022-12-16DOI: 10.1108/ajems-08-2022-0343
Malika Neifar
PurposeIn this paper, the author aims to investigate the relationship between economic growth and unemployment in six Arab countries from Middle East and North Africa (MENA) zone including Tunisia, Egypt, Morocco, Lebanon, Jordan and Oman through the implementation of Okun's law using quarterly dataset covering the time period 2000: 1–2014: 4.Design/methodology/approachIn this paper, static and dynamic linear and nonlinear models are used to test the linkage between cyclical unemployment and cyclical growth rate.FindingsThe empirical results from considered models confirm an inverse linkage between unemployment rate and economic growth, as the Okun's law suggests (except for Oman). In a nonlinear autoregressive dynamic linear (NARDL) framework and gap specification, statistically significant Okun's coefficients indicate that output growth can be translated into employment gains. Absolute effect of an economic contraction is significantly larger than that of an expansion in Tunisia, Egypt, Morocco and Lebanon. The opposite is true for Jordan and Oman.Practical implicationsEmpirical finding provides then an additional proof that Okun's law could exist in a developing countries such as Tunisia, Egypt, Morocco, Lebanon and Jordan. Hence, any attempt to increase gross domestic product (GDP) through some economic fiscal and/or monetary policies in these countries would reduce unemployment rate.Originality/valueBased on asymmetric specification, the author can conclude with precision that an economic upturn of 3.37, 2.98 and 2.5%, respectively, in Tunisia, Morocco and Egypt reduces unemployment by 1%, whilst the downturn of 5.03 and 2.43% (and about 12%), respectively, in Tunisia and Morocco (and Lebanon and Jordan) achieves the opposite.
{"title":"Revisit of Okun's law case of Tunisia, Egypt, Morocco, Lebanon, Jordan and Oman","authors":"Malika Neifar","doi":"10.1108/ajems-08-2022-0343","DOIUrl":"https://doi.org/10.1108/ajems-08-2022-0343","url":null,"abstract":"PurposeIn this paper, the author aims to investigate the relationship between economic growth and unemployment in six Arab countries from Middle East and North Africa (MENA) zone including Tunisia, Egypt, Morocco, Lebanon, Jordan and Oman through the implementation of Okun's law using quarterly dataset covering the time period 2000: 1–2014: 4.Design/methodology/approachIn this paper, static and dynamic linear and nonlinear models are used to test the linkage between cyclical unemployment and cyclical growth rate.FindingsThe empirical results from considered models confirm an inverse linkage between unemployment rate and economic growth, as the Okun's law suggests (except for Oman). In a nonlinear autoregressive dynamic linear (NARDL) framework and gap specification, statistically significant Okun's coefficients indicate that output growth can be translated into employment gains. Absolute effect of an economic contraction is significantly larger than that of an expansion in Tunisia, Egypt, Morocco and Lebanon. The opposite is true for Jordan and Oman.Practical implicationsEmpirical finding provides then an additional proof that Okun's law could exist in a developing countries such as Tunisia, Egypt, Morocco, Lebanon and Jordan. Hence, any attempt to increase gross domestic product (GDP) through some economic fiscal and/or monetary policies in these countries would reduce unemployment rate.Originality/valueBased on asymmetric specification, the author can conclude with precision that an economic upturn of 3.37, 2.98 and 2.5%, respectively, in Tunisia, Morocco and Egypt reduces unemployment by 1%, whilst the downturn of 5.03 and 2.43% (and about 12%), respectively, in Tunisia and Morocco (and Lebanon and Jordan) achieves the opposite.","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2022-12-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49414677","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 : 2022-11-17DOI: 10.1108/ajems-06-2022-0244
M. Nyathi, R. Kekwaletswe
PurposeThe purpose of this paper is to examine the mediating effect of employee job satisfaction on the relationship between electronic human resource management (e-HRM) use and e-HRM macro-level consequences.Design/methodology/approachData were collected through a survey involving 32 organizations, using e-HRM applications. A purposive sampling technique was employed. A structural equation modeling technique with the use of the process macro approach was used to analyze collected data.FindingsE-HRM use has a positive and significant effect on e-HRM macro-level consequences and constituent elements of e-HRM operational, relational and transactional consequences. Employee job satisfaction partially mediates the relationship between e-HRM use and e-HRM macro-level consequences.Practical implicationsThe use of e-HRM, complemented by human resource best practices, enhances employee job satisfaction. At an indirect level, job satisfaction partially mediates the effect of e-HRM use on e-HRM macro-level consequences. Organizations should invest in job satisfaction-enhancing practices to ensure attainment of intended organization-wide consequences on a more consistent basis.Originality/valueThe study broadens the scope through which the association between e-HRM use, e-HRM macro-level consequences and employee job satisfaction are viewed. The study illustrates the limitations of the deterministic view of e-HRM use, while supporting the assumptions of the moderate determinism approach, which pin the success of e-HRM systems on the performance and satisfaction of e-HRM actors. The level of employee job satisfaction mediates the relationship between e-HRM use and e-HRM macro-level consequences. The study, to the authors' knowledge, is the first in establishing such an effect.
{"title":"The relationship between electronic human resource management and employee job satisfaction in organizational value-creation in Africa: the case of Zimbabwe","authors":"M. Nyathi, R. Kekwaletswe","doi":"10.1108/ajems-06-2022-0244","DOIUrl":"https://doi.org/10.1108/ajems-06-2022-0244","url":null,"abstract":"PurposeThe purpose of this paper is to examine the mediating effect of employee job satisfaction on the relationship between electronic human resource management (e-HRM) use and e-HRM macro-level consequences.Design/methodology/approachData were collected through a survey involving 32 organizations, using e-HRM applications. A purposive sampling technique was employed. A structural equation modeling technique with the use of the process macro approach was used to analyze collected data.FindingsE-HRM use has a positive and significant effect on e-HRM macro-level consequences and constituent elements of e-HRM operational, relational and transactional consequences. Employee job satisfaction partially mediates the relationship between e-HRM use and e-HRM macro-level consequences.Practical implicationsThe use of e-HRM, complemented by human resource best practices, enhances employee job satisfaction. At an indirect level, job satisfaction partially mediates the effect of e-HRM use on e-HRM macro-level consequences. Organizations should invest in job satisfaction-enhancing practices to ensure attainment of intended organization-wide consequences on a more consistent basis.Originality/valueThe study broadens the scope through which the association between e-HRM use, e-HRM macro-level consequences and employee job satisfaction are viewed. The study illustrates the limitations of the deterministic view of e-HRM use, while supporting the assumptions of the moderate determinism approach, which pin the success of e-HRM systems on the performance and satisfaction of e-HRM actors. The level of employee job satisfaction mediates the relationship between e-HRM use and e-HRM macro-level consequences. The study, to the authors' knowledge, is the first in establishing such an effect.","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2022-11-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49442362","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 : 2022-10-31DOI: 10.1108/ajems-05-2022-0215
N. Olatunde, Á. M. Gento Municio, I. A. Awodele
PurposeDisruption caused by coronavirus disease 2019 (COVID-19) to the ways and manners businesses are conducted worldwide is phenomenon. The study therefore examined the survival strategies adopted by quantity surveying firms (QSFs) in Lagos State, Nigeria, with the intention of improving their performance.Design/methodology/approachThis study used a systematic sampling method to select three QSFs from 20 local government areas in the state. Of the 60 QSFs contacted for interview, only 42 agreed to participate. A questionnaire was designed to collect the required qualitative information, which was then analyzed using content analysis.FindingsThe results revealed that the main survival strategies adopted by QSFs in Lagos State, Nigeria, during the COVID-19 disruptions were downsizing, contract staffing, salary cuts, work from home and service negotiation strategies.Research limitations/implicationsDue to the chosen research approach, the research results may not be generalizable. The incidence of the pandemic and the socio-economic situation of the study area have to be considered.Practical implicationsThe survival strategies employed by QSFs in Lagos Nigeria in the middle of COVID-19 are palliative (unsustainable) as the impact of the disruptions is biting hard on QSFs in Lagos Nigeria as such a more robust and sustainable method to enhance the performance of QSFs in the study area.Originality/valueThis study attempted to unearth the survival strategies of QSFs amidst COVID-19 in Lagos State, Nigeria, with the aim of improving the performance of such firms.
{"title":"Examination of survival strategies of quantity surveying firms amid COVID-19 pandemic disruption in Lagos State, Nigeria","authors":"N. Olatunde, Á. M. Gento Municio, I. A. Awodele","doi":"10.1108/ajems-05-2022-0215","DOIUrl":"https://doi.org/10.1108/ajems-05-2022-0215","url":null,"abstract":"PurposeDisruption caused by coronavirus disease 2019 (COVID-19) to the ways and manners businesses are conducted worldwide is phenomenon. The study therefore examined the survival strategies adopted by quantity surveying firms (QSFs) in Lagos State, Nigeria, with the intention of improving their performance.Design/methodology/approachThis study used a systematic sampling method to select three QSFs from 20 local government areas in the state. Of the 60 QSFs contacted for interview, only 42 agreed to participate. A questionnaire was designed to collect the required qualitative information, which was then analyzed using content analysis.FindingsThe results revealed that the main survival strategies adopted by QSFs in Lagos State, Nigeria, during the COVID-19 disruptions were downsizing, contract staffing, salary cuts, work from home and service negotiation strategies.Research limitations/implicationsDue to the chosen research approach, the research results may not be generalizable. The incidence of the pandemic and the socio-economic situation of the study area have to be considered.Practical implicationsThe survival strategies employed by QSFs in Lagos Nigeria in the middle of COVID-19 are palliative (unsustainable) as the impact of the disruptions is biting hard on QSFs in Lagos Nigeria as such a more robust and sustainable method to enhance the performance of QSFs in the study area.Originality/valueThis study attempted to unearth the survival strategies of QSFs amidst COVID-19 in Lagos State, Nigeria, with the aim of improving the performance of such firms.","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2022-10-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48234613","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 : 2022-10-20DOI: 10.1108/ajems-04-2022-0168
M. Nyathi
PurposeThe purpose of this paper is to investigate the mediating role of perceived organizational politics on the relationship between electronic human resource management (e-HRM) use and e-HRM macro-level consequences.Design/methodology/approachThe paper uses a cross-sectional survey of HR professionals, line managers and information technology specialists. A purposive stratified sampling technique is employed. The analyses of data make use of regression and process macro in SPSS analysis.FindingsThe effect of e-HRM use on e-HRM macro-level consequences is partially mediated by perceived organizational politics.Practical implicationsOrganizations can invest in e-HRM use alongside other HR practices such as, emotional intelligence training, to reduce the negative effects of perceived organizational politics and in the process enhance employee attitudes and performance.Originality/valueThe study enriches the scope through which the interaction between e-HRM use and perceived organizational politics is viewed. The study was conducted in Zimbabwe, demonstrating that the indirect effect of e-HRM use on e-HRM macro-level consequences is not limited to developed economies.
{"title":"The effect of electronic human resource management on electronic human resource management macro-level consequences: the role of perception of organizational politics","authors":"M. Nyathi","doi":"10.1108/ajems-04-2022-0168","DOIUrl":"https://doi.org/10.1108/ajems-04-2022-0168","url":null,"abstract":"PurposeThe purpose of this paper is to investigate the mediating role of perceived organizational politics on the relationship between electronic human resource management (e-HRM) use and e-HRM macro-level consequences.Design/methodology/approachThe paper uses a cross-sectional survey of HR professionals, line managers and information technology specialists. A purposive stratified sampling technique is employed. The analyses of data make use of regression and process macro in SPSS analysis.FindingsThe effect of e-HRM use on e-HRM macro-level consequences is partially mediated by perceived organizational politics.Practical implicationsOrganizations can invest in e-HRM use alongside other HR practices such as, emotional intelligence training, to reduce the negative effects of perceived organizational politics and in the process enhance employee attitudes and performance.Originality/valueThe study enriches the scope through which the interaction between e-HRM use and perceived organizational politics is viewed. The study was conducted in Zimbabwe, demonstrating that the indirect effect of e-HRM use on e-HRM macro-level consequences is not limited to developed economies.","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2022-10-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46043417","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 : 2022-10-05DOI: 10.1108/ajems-10-2021-0436
Elisha Mavodyo
PurposeThis paper analyses the direct relationship between budget deficits and economic growth, the channels through which budget deficits inhibit growth and finally, the Granger causality between budget deficit and economic growth in South Africa over the period 1975 to 2020.Design/methodology/approachIn a bid to control for endogeneity that is common in economic growth regressions, the author employed the dynamic ordinary least squares (DOLS) approach.FindingsTowards analysing the direct relationship between budget deficit and economic growth, results show that a 10-percentage rise in the budget deficit slows economic growth by 0.2 percentage points. Results show that the growth inhibiting consequences of the budget deficit in South Africa are principally driven by negatively affecting private and public physical capital accumulation growth, as well as a drop in gross national savings. However, results show no evidence of a deficit reduction effect through long term-real interest rate. The findings reveal a one-way Granger causality running from budget deficits to economic growth.Practical implicationsBased on the findings in this article, expanding the fiscal deficit to support growth is not a viable policy option for the South African economy.Originality/valueThe originality of this paper lies in establishing the Granger causality between budget deficit and economic growth, thus adding to the scant literature, as well as establishing the channels through which budget deficit retards economic growth for the South African economy.
{"title":"The impact of budget deficit on economic growth and its channels in South Africa","authors":"Elisha Mavodyo","doi":"10.1108/ajems-10-2021-0436","DOIUrl":"https://doi.org/10.1108/ajems-10-2021-0436","url":null,"abstract":"PurposeThis paper analyses the direct relationship between budget deficits and economic growth, the channels through which budget deficits inhibit growth and finally, the Granger causality between budget deficit and economic growth in South Africa over the period 1975 to 2020.Design/methodology/approachIn a bid to control for endogeneity that is common in economic growth regressions, the author employed the dynamic ordinary least squares (DOLS) approach.FindingsTowards analysing the direct relationship between budget deficit and economic growth, results show that a 10-percentage rise in the budget deficit slows economic growth by 0.2 percentage points. Results show that the growth inhibiting consequences of the budget deficit in South Africa are principally driven by negatively affecting private and public physical capital accumulation growth, as well as a drop in gross national savings. However, results show no evidence of a deficit reduction effect through long term-real interest rate. The findings reveal a one-way Granger causality running from budget deficits to economic growth.Practical implicationsBased on the findings in this article, expanding the fiscal deficit to support growth is not a viable policy option for the South African economy.Originality/valueThe originality of this paper lies in establishing the Granger causality between budget deficit and economic growth, thus adding to the scant literature, as well as establishing the channels through which budget deficit retards economic growth for the South African economy.","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2022-10-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48610910","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 : 2022-09-20DOI: 10.1108/ajems-03-2022-0105
O. Olaoye
PurposeIn light of the recent calls for another round of debt relief for African countries, by African finance ministers and governments, the aim of the study is twofold. First, the study examined the effect of public debt on macroeconomic performance. Two, the study also examined whether previous debt relief has impacted positively on sub-Saharan African economies.Design/methodology/approachThe study adopts the two-step system GMM that accounts for potential endogeneity and feedback effect in dynamic panel models. As robustness, the study performs the two-stage least square (2SLS) estimation method.FindingsThe study reveals that previous debt relief programmes only had a marginal effect on economic growth in the region. The study found that corruption impacts negatively on the effectiveness of debt relief to achieve the desired economic outcomes. The study also found that sub-Saharan African economies seem to have shifted away from traditional concessional sources of financing towards market-based lenders dominated by China.Originality/valueThe study adds to the growing evidence in the public debt literature by looking at the separate impact of domestic and foreign debts on macroeconomic indicators of economic growth, inflation, unemployment and exchange rate. The study also controlled for previous debt relief in light of the call for another round of debt relief.Graphical Abstract
{"title":"Sub-Saharan Africa's rising public debt stock: before another debt relief!","authors":"O. Olaoye","doi":"10.1108/ajems-03-2022-0105","DOIUrl":"https://doi.org/10.1108/ajems-03-2022-0105","url":null,"abstract":"PurposeIn light of the recent calls for another round of debt relief for African countries, by African finance ministers and governments, the aim of the study is twofold. First, the study examined the effect of public debt on macroeconomic performance. Two, the study also examined whether previous debt relief has impacted positively on sub-Saharan African economies.Design/methodology/approachThe study adopts the two-step system GMM that accounts for potential endogeneity and feedback effect in dynamic panel models. As robustness, the study performs the two-stage least square (2SLS) estimation method.FindingsThe study reveals that previous debt relief programmes only had a marginal effect on economic growth in the region. The study found that corruption impacts negatively on the effectiveness of debt relief to achieve the desired economic outcomes. The study also found that sub-Saharan African economies seem to have shifted away from traditional concessional sources of financing towards market-based lenders dominated by China.Originality/valueThe study adds to the growing evidence in the public debt literature by looking at the separate impact of domestic and foreign debts on macroeconomic indicators of economic growth, inflation, unemployment and exchange rate. The study also controlled for previous debt relief in light of the call for another round of debt relief.Graphical Abstract","PeriodicalId":46031,"journal":{"name":"African Journal of Economic and Management Studies","volume":" ","pages":""},"PeriodicalIF":1.3,"publicationDate":"2022-09-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46444392","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 : 2022-09-19DOI: 10.1108/ajems-04-2022-0154
Adams Adeiza, Q. Oye, P. Alege
PurposeThis study examined the macroeconomic effects of COVID-19-induced economic policy uncertainty (EPU) in Nigeria. The study considered the effects of three related shocks: EPU, COVID-19 and correlated economic policy uncertainty and COVID-19 shock.Design/methodology/approachFirst, the study presented VAR evidence that fiscal and monetary policy uncertainty depresses real output. Thereafter, a nonlinear DSGE model with second-moment fiscal and monetary policy shocks was solved using the third-order Taylor approximation method.FindingsThe authors found that EPU shock is negligible and expansionary. By contrast, COVID-19 shocks have strong contractionary effects on the economy. The combined shocks capturing the COVID-19-induced EPU shock were ultimately recessionary after an initial expansionary effect. The implication is that the COVID-19 pandemic-induced EPU adversely impacted macroeconomic outcomes in Nigeria in a non-trivial manner.Practical implicationsThe result shows the importance of policies to cushion the effect of uncertain fiscal and monetary policy path in the aftermath of COVID-19.Originality/valueThe originality of the paper lies in examining the impact of COVID-19 induced EPU in the context of a developing economy using the DSGE methodology.
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