Pub Date : 2025-03-01DOI: 10.1016/j.ecosys.2024.101246
Fabian Reck , Jarko Fidrmuc , Frédéric Gruninger
The phenomenon of populism is widespread in the 21st century. In this paper, we analyze the correlation between the World Bank’s six worldwide governance indicators and populism, which is proxied by the populist rhetoric of government representatives. The panel data includes 40 developing and developed countries and covers the period from 2000 to 2018. The results suggest that good governance may help to reduce populist rhetoric. However, we show that a certain threshold of governance quality must be met to mitigate populist rhetoric. Refugee immigration and one-party dominance, on the other hand, increase populist rhetoric. Despite frequent claims, we do not find robust evidence that merchandise trade or a high unemployment rate strengthens populism.
{"title":"Impact of governance on populist rhetoric","authors":"Fabian Reck , Jarko Fidrmuc , Frédéric Gruninger","doi":"10.1016/j.ecosys.2024.101246","DOIUrl":"10.1016/j.ecosys.2024.101246","url":null,"abstract":"<div><div>The phenomenon of populism is widespread in the 21st century. In this paper, we analyze the correlation between the World Bank’s six worldwide governance indicators and populism, which is proxied by the populist rhetoric of government representatives. The panel data includes 40 developing and developed countries and covers the period from 2000 to 2018. The results suggest that good governance may help to reduce populist rhetoric. However, we show that a certain threshold of governance quality must be met to mitigate populist rhetoric. Refugee immigration and one-party dominance, on the other hand, increase populist rhetoric. Despite frequent claims, we do not find robust evidence that merchandise trade or a high unemployment rate strengthens populism.</div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"49 1","pages":"Article 101246"},"PeriodicalIF":2.8,"publicationDate":"2025-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141712034","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-03-01DOI: 10.1016/j.ecosys.2024.101248
Axelle Heyert , Laurent Weill
This paper examines the impact of trust in banks on financial inclusion in a cross-country framework. We use micro-level data informing on trust in banks and financial inclusion for a dataset of about 61,000 observations from 28 countries. We find evidence for the positive impact of trust in banks on financial inclusion. We find that the positive impact of trust in banks on financial inclusion affects all individuals, regardless of their socio-demographic characteristics and of their financial situation, and is not conditional to the country or the year. Overall, we provide support to enhance trust in banks in the perspective of promoting financial inclusion worldwide.
{"title":"Trust in banks and financial inclusion: Micro-level evidence from 28 countries","authors":"Axelle Heyert , Laurent Weill","doi":"10.1016/j.ecosys.2024.101248","DOIUrl":"10.1016/j.ecosys.2024.101248","url":null,"abstract":"<div><div>This paper examines the impact of trust in banks on financial inclusion in a cross-country framework. We use micro-level data informing on trust in banks and financial inclusion for a dataset of about 61,000 observations from 28 countries. We find evidence for the positive impact of trust in banks on financial inclusion. We find that the positive impact of trust in banks on financial inclusion affects all individuals, regardless of their socio-demographic characteristics and of their financial situation, and is not conditional to the country or the year. Overall, we provide support to enhance trust in banks in the perspective of promoting financial inclusion worldwide.</div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"49 1","pages":"Article 101248"},"PeriodicalIF":2.8,"publicationDate":"2025-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141844980","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-03-01DOI: 10.1016/j.ecosys.2024.101249
Izaskun Barba , Belén Iraizoz
A disproportionate concentration of women in low-pay and low-status sectors is a trend that has grown in significance with the globalization of production systems. For the health and social care sector, this has interesting socio-spatial implications, particularly in terms of immigration, the dimensions of which are worth investigating. This study employs the novel extended multiregional input-output FIGARO database to estimate the employment-generating capacity of the sector in the EU28, with a focus on the gender and geographic origin of its workers. The analysis takes into account both indirect and induced effects and considers both cross-country and cross-sectoral linkages. The findings identify the healthcare sector as a key source of employment for both national and immigrant women in more than half of EU countries. At the same time, this sector contributes to the earnings disadvantage experienced by women, which suggest that equality policies should consider the sectoral distribution of employment.
{"title":"The critical role of the health-care sector in promoting employment for women and migrants in the EU. A multicountry input-output analysis","authors":"Izaskun Barba , Belén Iraizoz","doi":"10.1016/j.ecosys.2024.101249","DOIUrl":"10.1016/j.ecosys.2024.101249","url":null,"abstract":"<div><div>A disproportionate concentration of women in low-pay and low-status sectors is a trend that has grown in significance with the globalization of production systems. For the health and social care sector, this has interesting socio-spatial implications, particularly in terms of immigration, the dimensions of which are worth investigating. This study employs the novel extended multiregional input-output FIGARO database to estimate the employment-generating capacity of the sector in the EU28, with a focus on the gender and geographic origin of its workers. The analysis takes into account both indirect and induced effects and considers both cross-country and cross-sectoral linkages. The findings identify the healthcare sector as a key source of employment for both national and immigrant women in more than half of EU countries. At the same time, this sector contributes to the earnings disadvantage experienced by women, which suggest that equality policies should consider the sectoral distribution of employment.</div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"49 1","pages":"Article 101249"},"PeriodicalIF":2.8,"publicationDate":"2025-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141947932","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-03-01DOI: 10.1016/j.ecosys.2024.101254
Zhandos Ybrayev , Azamat Baizakov, Erlan Kailrullayev, Dana Mukhambetzhanova
We take advantage of the early adoption of the debt-service-to-income cap (DSTI) measure in Kazakhstan, as well as available granular information from the local credit registry to study the effects of macroprudential instruments on core financial stability parameters. Our results show that implementation of a DSTI cap of 50 % leads to around a 9 % decrease in 12 months in the amount of outstanding debt on average for the range of credits originated just around the introduction of the DSTI cap. We find that DSTI cap implementation decreased the probability of delinquency rates of loans by about 20 % in 12 months on average compared to credits granted before the realization of the DSTI cap. We provide evidence on the importance of loan size heterogeneity across time when estimating the impact of macro-prudential intervention, which is partly overlooked in the existing literature. Finally, our results suggest that macroprudential and monetary policy tools can be complementary depending on the specific business cycle developments.
{"title":"Macroprudential policy effectiveness and interaction with monetary policy: Lessons from debt service-to-income cap implementation in Kazakhstan","authors":"Zhandos Ybrayev , Azamat Baizakov, Erlan Kailrullayev, Dana Mukhambetzhanova","doi":"10.1016/j.ecosys.2024.101254","DOIUrl":"10.1016/j.ecosys.2024.101254","url":null,"abstract":"<div><div>We take advantage of the early adoption of the debt-service-to-income cap (DSTI) measure in Kazakhstan, as well as available granular information from the local credit registry to study the effects of macroprudential instruments on core financial stability parameters. Our results show that implementation of a DSTI cap of 50 % leads to around a 9 % decrease in 12 months in the amount of outstanding debt on average for the range of credits originated just around the introduction of the DSTI cap. We find that DSTI cap implementation decreased the probability of delinquency rates of loans by about 20 % in 12 months on average compared to credits granted before the realization of the DSTI cap. We provide evidence on the importance of loan size heterogeneity across time when estimating the impact of macro-prudential intervention, which is partly overlooked in the existing literature. Finally, our results suggest that macroprudential and monetary policy tools can be complementary depending on the specific business cycle developments.</div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"49 1","pages":"Article 101254"},"PeriodicalIF":2.8,"publicationDate":"2025-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142200708","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-03-01DOI: 10.1016/j.ecosys.2024.101243
Chao Fang
A key challenge for developing countries is improving border taxes enforcement. This study examines whether the Electronic Data Exchange project between Pakistan and China can reduce tax evasion at the Pakistan border. This data exchange significantly reduced the trade gap in consumer goods between China’s reported exports to Pakistan and Pakistan’s reported imports from China, compared to non-consumer goods. These results are consistent with the weak self-enforcing incentives of value-added tax at the consumer stage. Moreover, the data exchange primarily reduced the trade gap by limiting the underreporting of prices rather than reducing the underreporting of quantities, partly fulfilling the project’s original intention. Further exploratory analysis reveals that the data exchange contributed to a reduction in export prices, indicating that Chinese exporters might have been absorbing a portion of the tax burden. This study suggests that using export declarations to improve tax enforcement might not increase tax revenue, as importers and exporters could alter their behavior strategically.
{"title":"Taxation with information: Impacts of customs data exchange on tax evasion in Pakistan","authors":"Chao Fang","doi":"10.1016/j.ecosys.2024.101243","DOIUrl":"10.1016/j.ecosys.2024.101243","url":null,"abstract":"<div><div>A key challenge for developing countries is improving border taxes<span><span> enforcement. This study examines whether the Electronic Data Exchange project between Pakistan and China can reduce tax evasion at the Pakistan border. This data exchange significantly reduced the trade gap in consumer goods between China’s reported exports to Pakistan and Pakistan’s reported imports from China, compared to non-consumer goods. These results are consistent with the weak self-enforcing incentives of value-added tax at the consumer stage. Moreover, the data exchange primarily reduced the trade gap by limiting the underreporting of prices rather than reducing the underreporting of quantities, partly fulfilling the project’s original intention. Further </span>exploratory analysis reveals that the data exchange contributed to a reduction in export prices, indicating that Chinese exporters might have been absorbing a portion of the tax burden. This study suggests that using export declarations to improve tax enforcement might not increase tax revenue, as importers and exporters could alter their behavior strategically.</span></div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"49 1","pages":"Article 101243"},"PeriodicalIF":2.8,"publicationDate":"2025-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143510035","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-12-01DOI: 10.1016/j.ecosys.2024.101199
Yu You , Junsoo Lee , Yoonbai Kim , Zheng Yang
In contrast to existing studies that have paid limited attention to comovement in the current account balances of inter-related countries, we employ a dynamic factor model to evaluate the contributions of the common global factor, group factors (advanced or emerging countries), and country-specific factors for 12 advanced and eight emerging economies from 1970 to 2017. We find that current account balances are largely driven by the group factor for advanced economies; however, current account balances in most emerging economies are primarily driven by country-specific factors. We then investigate the roles of these factors using the traditional empirical model for current account determination. Global and group factors are essential for addressing current accounts’ cross-sectional dependence in panel data models. We find that the empirical results introducing these factors are stronger, and the coefficients of relevant variables become more significant. Furthermore, we examine how these factors are related to the structural determinants of current account balances, revealing that more capital mobility and trade openness tend to increase the share of the group factor, while increases in country-specific determinants lead to a greater share in the country factor.
{"title":"Comovement and Global Imbalances of Current Accounts","authors":"Yu You , Junsoo Lee , Yoonbai Kim , Zheng Yang","doi":"10.1016/j.ecosys.2024.101199","DOIUrl":"10.1016/j.ecosys.2024.101199","url":null,"abstract":"<div><div><span>In contrast to existing studies that have paid limited attention to comovement in the current account balances of inter-related countries, we employ a dynamic factor model to evaluate the contributions of the common global factor, group factors (advanced or emerging countries), and country-specific factors for 12 advanced and eight emerging economies from 1970 to 2017. We find that current account balances are largely driven by the group factor for advanced economies; however, current account balances in most emerging economies are primarily driven by country-specific factors. We then investigate the roles of these factors using the traditional empirical model for current account determination. Global and group factors are essential for addressing current accounts’ cross-sectional dependence in panel data models<span>. We find that the empirical results introducing these factors are stronger, and the coefficients of relevant variables become more significant. Furthermore, we examine how these factors are related to the structural determinants of current account balances, revealing that more capital mobility and </span></span>trade openness tend to increase the share of the group factor, while increases in country-specific determinants lead to a greater share in the country factor.</div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"48 4","pages":"Article 101199"},"PeriodicalIF":2.8,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139924015","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This study examines the effect of environment-related technologies on environmental quality, conditional on the level of uncertainty. We apply two panel quantile regression approaches to panel data on the member countries of the Organization for Economic Cooperation and Development (OECD) over the period 1990–2015. The empirical results suggest that environment-related technologies and uncertainty both significantly help improve the environmental conditions, although the magnitude of these impacts vary across the level of environmental footprint. Notably, higher uncertainty could negate the beneficial effects of green patents on the environmental footprint, especially in a highly degraded environment. Several preliminary tests, such as cross-sectional dependence, stationarity, cointegration, and nonnormality, provide support for the adoption of panel quantile regression. The significant and heterogeneous relationships between the environmental footprint and its determining factors are also established. This research offers a scientific explanation for the ineffective adoption of environment-related technologies for improving environmental quality in many OECD countries for years and hence has valuable implications for policy makers about leveraging the beneficial impacts of environment-related technologies on the ecosystem.
{"title":"What makes environment-related technologies less effective? The role of uncertainty","authors":"Hung Manh Pham , Lan Khanh Chu , Dung Phuong Hoang","doi":"10.1016/j.ecosys.2024.101222","DOIUrl":"10.1016/j.ecosys.2024.101222","url":null,"abstract":"<div><div><span>This study examines the effect of environment-related technologies on environmental quality, conditional on the level of uncertainty. We apply two panel </span>quantile<span> regression approaches to panel data on the member countries of the Organization for Economic Cooperation and Development (OECD) over the period 1990–2015. The empirical results suggest that environment-related technologies and uncertainty both significantly help improve the environmental conditions, although the magnitude of these impacts vary across the level of environmental footprint. Notably, higher uncertainty could negate the beneficial effects of green patents on the environmental footprint, especially in a highly degraded environment. Several preliminary tests, such as cross-sectional dependence, stationarity, cointegration, and nonnormality, provide support for the adoption of panel quantile regression. The significant and heterogeneous relationships between the environmental footprint and its determining factors are also established. This research offers a scientific explanation for the ineffective adoption of environment-related technologies for improving environmental quality in many OECD countries for years and hence has valuable implications for policy makers about leveraging the beneficial impacts of environment-related technologies on the ecosystem.</span></div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"48 4","pages":"Article 101222"},"PeriodicalIF":2.8,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140884827","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-12-01DOI: 10.1016/j.ecosys.2024.101221
Jakob de Haan , Jan P.A.M. Jacobs , Renske Zijm
Is it beneficial for Central and Eastern European EU Member States to join the euro area? To answer that question, the coherence of the business cycles of six EU Member States and the euro area is analyzed. These countries recently joined (Croatia) or are supposed to join the euro area in the (near) future. The analysis utilizes the synchronicity and similarity measures proposed by Mink et al. (2012). Whereas the synchronicity measure captures whether output gaps have the same sign, the similarity measure identifies differences in cycle amplitudes. It is observed that the business cycles of several countries, notably Romania and Hungary, are out of sync with that of the euro area. The output gap similarity and synchronicity measures for Croatia are also fairly low. However, this also holds for some countries in the euro area.
中欧和东欧欧盟成员国加入欧元区是否有利？为了回答这个问题，本文分析了六个欧盟成员国和欧元区商业周期的一致性。这些国家最近加入了（克罗地亚）或将在（不久的）将来加入欧元区。分析采用Mink et al.（2012）提出的同步性和相似性度量。同步性度量捕获输出间隙是否具有相同的符号，而相似性度量识别周期幅度的差异。人们注意到，几个国家的商业周期，尤其是罗马尼亚和匈牙利，与欧元区的商业周期不同步。克罗地亚的产出缺口相似度和同步性指标也相当低。然而，这也适用于欧元区的一些国家。
{"title":"Coherence of the business cycles of prospective members of the euro area and the euro area business cycle","authors":"Jakob de Haan , Jan P.A.M. Jacobs , Renske Zijm","doi":"10.1016/j.ecosys.2024.101221","DOIUrl":"10.1016/j.ecosys.2024.101221","url":null,"abstract":"<div><div>Is it beneficial for Central and Eastern European EU Member States to join the euro area? To answer that question, the coherence of the business cycles of six EU Member States and the euro area is analyzed. These countries recently joined (Croatia) or are supposed to join the euro area in the (near) future. The analysis utilizes the synchronicity and similarity measures proposed by <span><span>Mink et al. (2012)</span></span>. Whereas the synchronicity measure captures whether output gaps have the same sign, the similarity measure identifies differences in cycle amplitudes. It is observed that the business cycles of several countries, notably Romania and Hungary, are out of sync with that of the euro area. The output gap similarity and synchronicity measures for Croatia are also fairly low. However, this also holds for some countries in the euro area.</div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"48 4","pages":"Article 101221"},"PeriodicalIF":2.8,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141033329","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-12-01DOI: 10.1016/j.ecosys.2024.101251
Fabian Alex
This paper investigates the determinants of the probability that a central bank chooses to make its financial sector green. We derive a mixed-strategy Nash equilibrium from a strategic setting of two monetary authorities choosing simultaneously between the alternatives of greening and conducting business as usual. Using a very general setup, we obtain a model that nests most of the usual 2 × 2-situations in game theory. “Green” avoids a country’s contribution to an externality experienced by both, but also encompasses a sacrifice of slowing down economic performance. The probability of greening is found to decrease whenever “greening” means a larger sacrifice for the other country, while it increases with the size of both countries, the rate of internalization applied to the externality as well as the severity of this externality. Unlike the typical (pure) free-riding approach to international coordination on environmental issues, we find some willingness of countries to sacrifice wealth for the sake of avoiding a worst case. In a repeated setting, cooperative solutions can be established. The influence of discounting on the stability of these solutions is ambiguous.
{"title":"Green central banking and game theory: The Chicken Game-approach","authors":"Fabian Alex","doi":"10.1016/j.ecosys.2024.101251","DOIUrl":"10.1016/j.ecosys.2024.101251","url":null,"abstract":"<div><div>This paper investigates the determinants of the probability that a central bank chooses to make its financial sector green. We derive a mixed-strategy Nash equilibrium from a strategic setting of two monetary authorities choosing simultaneously between the alternatives of greening and conducting business as usual. Using a very general setup, we obtain a model that nests most of the usual 2 × 2-situations in game theory. “Green” avoids a country’s contribution to an externality experienced by both, but also encompasses a sacrifice of slowing down economic performance. The probability of greening is found to decrease whenever “greening” means a larger sacrifice for the other country, while it increases with the size of both countries, the rate of internalization applied to the externality as well as the severity of this externality. Unlike the typical (pure) free-riding approach to international coordination on environmental issues, we find some willingness of countries to sacrifice wealth for the sake of avoiding a worst case. In a repeated setting, cooperative solutions can be established. The influence of discounting on the stability of these solutions is ambiguous.</div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"48 4","pages":"Article 101251"},"PeriodicalIF":2.8,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142200712","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Motivated by China’s rising global economic prominence, which impacts many regional and global development issues, and the unsettled relationship between financial development and economic growth, this study uses data from 1980 to 2019 to re-examine the nexus between economic growth and financial development in this country. This study distinguishes itself from existing literature by using the maximum entropy bootstrap inference method, examining multiple dimensions of financial development and economic growth, and accounting for structural breaks. The first finding reveals a unidirectional Granger-causal relationship from aggregate economic growth to financial development. This causality is observed to mainly go towards the depth and access of financial markets and the depth of financial institutions. The second indicates that bidirectional Granger-causal relationships exist between financial development with exports and imports. The third reveals that structural breaks exhibit varying levels of statistical significance in the relationship between financial development and economic growth. These findings suggest that policymakers need to further deepen and broaden capital markets to strengthen financial development and economic growth linkages.
{"title":"A maximum entropy bootstrap approach to financial development and economic growth in China","authors":"Renfang Tian , Jingjing Xu , Hui Feng , Adian McFarlane","doi":"10.1016/j.ecosys.2024.101219","DOIUrl":"10.1016/j.ecosys.2024.101219","url":null,"abstract":"<div><div>Motivated by China’s rising global economic prominence, which impacts many regional and global development issues, and the unsettled relationship between financial development and economic growth, this study uses data from 1980 to 2019 to re-examine the nexus between economic growth and financial development in this country. This study distinguishes itself from existing literature by using the maximum entropy bootstrap inference method, examining multiple dimensions of financial development and economic growth, and accounting for structural breaks. The first finding reveals a unidirectional Granger-causal relationship from aggregate economic growth to financial development. This causality is observed to mainly go towards the depth and access of financial markets and the depth of financial institutions. The second indicates that bidirectional Granger-causal relationships exist between financial development with exports and imports. The third reveals that structural breaks exhibit varying levels of statistical significance in the relationship between financial development and economic growth. These findings suggest that policymakers need to further deepen and broaden capital markets to strengthen financial development and economic growth linkages.</div></div>","PeriodicalId":51505,"journal":{"name":"Economic Systems","volume":"48 4","pages":"Article 101219"},"PeriodicalIF":2.8,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142748294","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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