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Journal Cover Economies
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  This is an Open Access Journal Open Access journal
   ISSN (Online) 2227-7099
   Published by MDPI Homepage  [151 journals]
  • Economies, Vol. 5, Pages 22: The Relevance of Political Stability on FDI:
           A VAR Analysis and ARDL Models for Selected Small, Developed, and
           Instability Threatened Economies

    • Authors: Petar Kurecic, Filip Kokotovic
      First page: 22
      Abstract: This paper studies the relevance of political stability on foreign direct investment (FDI) and the relevance of FDI on economic growth, in three panels. The first panel contains 11 very small economies; the second contains five well-developed and politically stable economies with highly positive FDI net inflows, while the third is a panel with economies that are prone to political violence or targeted by the terrorist attacks. We employ a Granger causality test and implement a vector autoregressive (VAR) framework within the panel setting. In order to test the sensitivity of the results and avoid robust errors, we employ an ARDL model for each of the countries within every panel. Based upon our results, we conclude that there is a long-term relationship between political stability and FDI for the panel of small economies, while we find no empiric evidence of such a relationship for both panels of larger and more developed economies. Similarly to the original hypothesis of Lucas (1990), we find that FDI outflows tend to go towards politically less stable countries. On the other hand, the empiric methodology employed did not find such conclusive evidence in the panels of politically more developed countries or in the small economies that this paper observes.
      PubDate: 2017-06-22
      DOI: 10.3390/economies5030022
      Issue No: Vol. 5, No. 3 (2017)
  • Economies, Vol. 5, Pages 23: Regime-Switching Effect of Tourism
           Specialization on Economic Growth in Asia Pacific Countries

    • Authors: Geng-Nan Chiang, Wei-Ying Sung, Wen-Guu Lei
      First page: 23
      Abstract: In the past 30 years, many studies have focused on exploring the relationship between tourism development and economic growth. However, there has been no consensus reached concerning of the relationship. This study will attempt to clarify the relationship between tourism development and economic growth. The purpose of this study is to analyze the relationship between tourism development and economic growth. This study applies the Panel Smooth Transition Regression Model (PSTR) proposed by Gonzalez et al. (2005) to investigate the regime-switching effect of tourism specialization on economic growth in Asia Pacific countries over the period 1996–2009. The results are as follows: (a) there were regime-switching effects of tourism specialization on economic growth; (b) the tourism specialization on economic growth has a better explanation for the effects of non-linear PSTR than linear PLS (Panel Least Squares); (c) in medium degree of tourism specialization countries (the value is between 0.0123~0.01663), tourism development has a significantly positive influence on economic growth, but consumption ability and investment ratios have a significantly negative influence on economic growth; (d) in low or high degree of tourism specialization countries (the value is below 0.0123 or above 0.01663), tourism development has a reduced influence on economic growth, and significantly positive influence on consumption ability and investment ratios. On the basis of these results, this study presents policy recommendations and areas for future research.
      PubDate: 2017-06-27
      DOI: 10.3390/economies5030023
      Issue No: Vol. 5, No. 3 (2017)
  • Economies, Vol. 5, Pages 24: The Nonlinearity of the New Keynesian
           Phillips Curve: The Case of Tunisia

    • Authors: Imen Kobbi, Foued-Badr Gabsi
      First page: 24
      Abstract: This article seeks to check the nonlinearity of the Phillips curve in Tunisia for the 1993–2012 period, relying on a hybrid new Keynesian Phillips curve modeled via a Logistic Smooth Transition Regression (LSTR) model with endogenous variables. We estimate this model using the nonlinear instrumental variables. The empirical results corroborate the new Keynesian assumption ofprice rigidity and show that the response of inflation to the output gap tends to be significant only if the inflation rate tends to be relatively high and exceeds a certain threshold. For a low inflation rate, the price rigidity dominates. This result is particularly evident in Tunisia, especially for the years following the 2011 revolution during which the elasticity of inflation rate to an excess demand has become highly important and the inflation rate experienced record levels.
      Citation: Economies
      PubDate: 2017-07-07
      DOI: 10.3390/economies5030024
      Issue No: Vol. 5, No. 3 (2017)
  • Economies, Vol. 5, Pages 25: Nonlinear Effects of Remittances on Per
           Capita GDP Growth in Bangladesh

    • Authors: Gazi Hassan, Shamim Shakur
      First page: 25
      Abstract: This paper examines the impact of inward remittances flows on per capita gross domestic product (GDP) growth in Bangladesh during 1976–2012. We find that the growth effect of remittances is negative at first but becomes positive at a later stage, evidence of a non-linear relationship. Unproductive use of remittances was rampant in the beginning when they were received by migrant families, but better social and economic investments led to more productive utilization of remittances receipts at later periods. This suggests a U-shaped relationship between remittances and per capita GDP growth. Unlike what is suggested in the literature, that the effect of remittances is more pronounced in a less financially developed economy, our evidence does not show that the effect of remittances on per capita GDP growth in Bangladesh is conditional on the level of financial development.
      Citation: Economies
      PubDate: 2017-07-17
      DOI: 10.3390/economies5030025
      Issue No: Vol. 5, No. 3 (2017)
  • Economies, Vol. 5, Pages 26: From Clusters to Smart Specialization:
           Tourism in Institution-Sensitive Regional Development Policies

    • Authors: Maximilian Benner
      First page: 26
      Abstract: In the European Union and its neighborhood, regional development has increasingly come to focus on agglomerations during the last three decades. Notably, during the 1990s and early 2000s, clustering was the major policy focus in regional development. Currently, the concept of smart specialization is applied all over the European Union and is attracting interest in the EU’s neighborhood. The tourism sector particularly tends to agglomerate regionally and even locally. While there is a large body of literature describing tourism clusters and while tourism features as a priority sector in many regional development strategies such as smart specialization strategies, there is a research gap on policy approaches applying agglomeration-oriented policy concepts to tourism destinations in an institution-sensitive way. This article argues that both cluster policy and smart specialization can be of considerable value for institution-sensitive tourism development, either when adapted to the specificities of the tourism sector or when integrating tourism development into wider, cross-sectoral strategies of regional development. Such a policy can be a valuable tool for local and regional development, provided that policies are designed in an institution-sensitive manner and respond to the particular institutional context prevailing in a tourist destination. The article illustrates some preliminary thoughts for institution-sensitive tourism development through cluster policy and smart specialization in Cyprus, Israel, and Tunisia.
      Citation: Economies
      PubDate: 2017-07-17
      DOI: 10.3390/economies5030026
      Issue No: Vol. 5, No. 3 (2017)
  • Economies, Vol. 5, Pages 11: Natural Resources and Productivity: Can
           Banking Development Mitigate the Curse?

    • Authors: Ramez Badeeb, Hooi Lean
      First page: 11
      Abstract: This paper contributes to the literature concerning the natural resource curse by exploring the role of banking development in reducing the resource curse in a natural resource-based country, Yemen. Using time series data over the period 1980–2012, we find that natural resource dependence is negatively related to productivity, and this relationship depends on the level of banking development. Increasing this level reduces the negative consequences of the natural resource curse. Therefore, policymakers should proactively encourage credit to enable the banking sector to play a more efficient intermediary role in mobilizing domestic savings and channeling them to productive investments. This will help to accumulate permanent productive wealth to enhance any diversification effort and compensate for the decline in natural resource production.
      PubDate: 2017-04-06
      DOI: 10.3390/economies5020011
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 12: Household’s Perception of Water Quality and
           Willingness to Pay for Clean Water in Mexico City

    • Authors: Lilia Rodríguez-Tapia, Daniel Revollo-Fernández, Jorge Morales-Novelo
      First page: 12
      Abstract: A 2011 survey of Mexico City’s households revealed that families prefer alternative sources of drinking water instead of relying in the city’s quality supply services. These include the purchase of bottled water, installation of filtration devices, and other means of water purification. The demand for better water quality was tested by estimating the household’s willingness to pay (WTP), using a contingency valuation (CV) experiment through an open-format questionnaire and by estimating a censored econometric (Tobit) model. The econometric study revealed that the WTP for better water quality is influenced by variables related with distrust of the water quality provided by the City and the organoleptic characteristics of the water supply, as well as spending on bottled water or water purification technologies. The average WTP surcharge for better potable water quality is US$3.1 or 4.7% of the bimonthly water bill, which is about 0.22% of the average family income in Mexico City. The percentage of WTP to income is bigger in poor families. This suggests that improving water quality is of greater importance for lower income families. Findings are consistent with previous studies that estimated the WTP for improvements in the services that supply water to households in the city. These include reduction of inefficiency and intermittency of the supply along with water quality, improve measuring water meters, reducing the obsolescence of the infrastructure and increasing adequate maintenance. Our research is the first to estimate the WTP for better water quality in Mexico City and constitutes a reference point for those that address the problem of water quality and its impact on the welfare and income of families.
      PubDate: 2017-04-11
      DOI: 10.3390/economies5020012
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 13: The Role of Oil Prices in Exchange Rate
           Movements: The CIS Oil Exporters

    • Authors: Fakhri Hasanov, Jeyhun Mikayilov, Cihan Bulut, Elchin Suleymanov, Fuzuli Aliyev
      First page: 13
      Abstract: Undoubtedly, oil prices play a crucial role in the macroeconomic performances of oil-exporting developing countries. In this regard, the exchange rate is one of the key macroeconomic indicators worthy of investigation. Existing literature shows that world oil prices play an important role in the appreciation of the exchange rates of oil-exporting developing countries. However, only a few studies have examined this issue by considering all three oil-exporting countries of the Commonwealth Independent States, namely Azerbaijan, Kazakhstan and Russia, together. In order to fill this gap and given the increasing importance of these economies in the world’s energy markets, this paper examines the role of oil prices in the movement of real effective exchange rates of the above-mentioned CIS countries. We applied the autoregressive distributed lag bounds testing method with a small sample bias correction to the data of these countries over the 2004Q1–2013Q4 period. The estimation results indicate that oil prices are certainly a main driver behind real effective exchange rate appreciation in the selected economies. Moreover, estimations show that productivity, to some extent, can also lead to the appreciation. The policy implication of this research is that an appreciation of the real exchange rate is harmful for the exports of non-oil goods and services in these countries. Since oil prices lead to the appreciation mainly through higher domestic prices, which is a result of tremendous public spending, decision-makers should reconsider the prevailing fiscal policy to make it much more counter-cyclical.
      PubDate: 2017-04-19
      DOI: 10.3390/economies5020013
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 14: Fréchet Distribution Applied to Salary
           Incomes in Spain from 1999 to 2014. An Engineering Approach to Changes in
           Salaries’ Distribution

    • Authors: Santiago Pindado, Carlos Pindado, Javier Cubas
      First page: 14
      Abstract: The official data in relation to salaries paid in Spain from 1999 to 2014 has been analyzed. The inadequate data format does not reflect the whole salary distribution. Fréchet distributions have been fitted to the data. This simple distribution has similar accuracy in relation to the data when compared to other distributions (Log-Normal, Gamma, Dagum, GB2). Analysis of the data through the fitted Fréchet distributions reveals a tendency towards more balanced (i.e., less skewed) salary distributions from 2002 to 2014 in Spain.
      PubDate: 2017-05-01
      DOI: 10.3390/economies5020014
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 15: Sources of Economic Growth in Zambia,
           1970–2013: A Growth Accounting Approach

    • Authors: Kelvin Mulungu, John Ng’ombe
      First page: 15
      Abstract: Most empirical work on sources of economic growth for different countries lack country-specific empirical evidence to guide policy choices in individual developing countries and previous studies of factor productivity tend to focus on the entire economy or a single sector. This provides fewer insights about a country’s structural evolution. Unlike previous studies, our study builds on this by taking a more comprehensive approach in estimating Zambia’s sources of economic growth by sectors—agriculture, industry, and service—in a systematic manner that yields insights into the country’s sources of structural transformation. We use recently developed growth accounting tools to explicitly determine sources of economic growth at both national and sectoral levels in Zambia between 1970 and 2013. We use data from World Development Indicators and Zambia’s Central Statistical Office. Results indicate that, on average, total factor productivity (TFP) contributes about 5.7% to economic growth. Sectoral analysis shows that agriculture contributes the least to GDP and that, within each sector, factors that contribute to growth differ. Structural transformation has been slow and contributed to the observed inefficiency. We outline the implications of the observed growth and provide recommendations.
      PubDate: 2017-05-11
      DOI: 10.3390/economies5020015
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 16: Remittances and Household Expenditure in
           Nepal: Evidence from Cross-Section Data

    • Authors: Sridhar Thapa, Sanjaya Acharya
      First page: 16
      Abstract: This paper examines the effect of remittances on household expenditure patterns applying propensity score matching methods that allow designing and analyzing observational data and enable reducing selection bias. We use data from the Nepal Living Standards Survey 2010/2011. In general, remittance recipient households tend to spend more on consumption, health and education as compared to remittance non-receiving households. Although the findings do not clearly provide evidence of either the productive or non-productive use of remittances, expenditures on non-food investment categories, such as durable goods, health and education, are more apparent among remittance-receiving households compared to remittance non-receiving households, which signal the prospect of a sustainable long-term welfare gain among the former.
      PubDate: 2017-05-23
      DOI: 10.3390/economies5020016
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 17: Relationship between Institutional Factors
           and FDI Flows in Developing Countries: New Evidence from Dynamic Panel

    • Authors: Zühal Kurul, A. Yalta
      First page: 17
      Abstract: In this paper, we revisit the relation between institutional factors and foreign direct investment (FDI) inflows in developing countries by employing a dynamic panel methodology, which enables us to deal with the persistency of FDI flows and endogeneity issues. We also contribute to the literature by using various measures of institutions to identify which aspects of institutional quality affect FDI in the developing world. Our empirical findings based on 113 developing countries over the period 2002–2012 show evidence that some institutional factors matter more than others in attracting more FDI flows. We also found that the financial crisis in 2008 and 2009 had a negative impact on FDI flows.
      PubDate: 2017-05-30
      DOI: 10.3390/economies5020017
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 18: Economic Freedom and Income Inequality: Does
           Political Regime Matter?

    • Authors: Mahyudin Ahmad
      First page: 18
      Abstract: There is a growing literature studying the effects of economic freedom and democracy on income inequality; nevertheless, the inequality-effects of both factors are apparently studied separately. This paper revisits the income inequality-economic freedom nexus and uncovers the role of political regime in explaining the relationship. Using the latest inequality data from Standardized World Income Inequality (SWIID) version 5.0 for a sample of countries up to 115 over 1970–2014 period, and via dynamic panel GMM estimation method, an inequality model that explicitly captures the interaction effect of economic freedom and democracy is estimated. The findings demonstrate that economic freedom has positive effect on income inequality. The estimated size of inequality-increasing effects of economic freedom is substantial, ranging between 0.3% and 0.5% per annum. Nevertheless, the findings show that the freedom-induced inequality is attenuated in the presence of a democratic regime in the countries under study. Furthermore, freedom of international trade and market deregulation are shown to be the two most consistently significant liberalization policies across the baseline estimations and various sensitivity tests. The paper is concluded with some policy implications.
      PubDate: 2017-06-05
      DOI: 10.3390/economies5020018
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 19: Management of Oil Revenues: Has That of
           Azerbaijan Been Prudent?

    • Authors: Sarvar Gurbanov, Jeffrey Nugent, Jeyhun Mikayilov
      First page: 19
      Abstract: To help explain the common failure of oil or other natural resource exporting countries to diversify into industry, it has been common to trace this failure to real exchange rate appreciation. This has also been done in Azerbaijan. However, because Azerbaijan has devoted so much of its oil revenues to government investment, Azerbaijan provides a suitable case for examining an alternative link through government investment. This study applies the ARDL cointegration method to quarterly time series data on oil prices, government capital formation, non-oil exports and non-oil GDP to estimate the long run relationships linking oil prices to government investment expenditures and further to generation of non-oil GDP. The results show that despite the massive government investment expenditures, extremely little non-oil production of the tradable type has been generated, calling attention to the need for policy reform.
      PubDate: 2017-06-12
      DOI: 10.3390/economies5020019
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 20: Does FDI Really Matter to Economic Growth in

    • Authors: Yoon Choi, Jungho Baek
      First page: 20
      Abstract: The main contribution of this article is to examine the productivity spillover effects from India’s inward foreign direct investment (FDI), controlling for trade, in the framework of the cointegrated vector autoregression (CVAR). For this purpose, using the Solow residual approach the aggregate total factor productivity (TFP) in India is estimated to measure FDI-induced spillovers. The results show that the inflow of FDI to India indeed improves TFP growth through positive spillover effects. We also find that trade appears to have a detrimental effect on TFP growth in India.
      PubDate: 2017-06-12
      DOI: 10.3390/economies5020020
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 21: Willingness to Pay for Tourist Tax in
           Destinations: Empirical Evidence from Istanbul

    • Authors: Gurel Cetin, Zaid Alrawadieh, Mithat Dincer, Fusun Istanbullu Dincer, Dimitri Ioannides
      First page: 21
      Abstract: Revenue generated from tourism taxes constitutes an important financial resource for local governments and tourism authorities to both ensure tourism sustainability and enhance the quality of tourist experiences. In order for tourism policy makers to create an efficient and fair tax system in tourism destinations, it is crucial to understand travelers’ perceptions concerning willingness to pay (WTP), tax rates, and their optimal allocation. The objectives of this paper, therefore, are to evaluate tourism taxes as a compensation tool to cover the costs of tourism and to measure tourists’ WTP. The paper also suggests a fair allocation of tax revenues based on tourists’ perceptions. A qualitative approach was used and data were collected through semi-structured in-depth interviews with international travelers to Istanbul, Turkey. The findings suggest that tourists are more likely to pay an additional amount of tax when this is earmarked for improvements in their experiences, but they are reluctant to take on liability concerning matters relating to destination sustainability. Based on the travelers’ perceptions, the paper also identified areas that need investment to improve tourist experiences. An interesting highlight of this paper is that the majority of surveyed respondents reported that their travel decisions would not be negatively affected even if the total cost of their vacation increased by one third. The findings are expected to offer fresh and much-needed insights into tourist taxation for tourism policy makers and stakeholders.
      PubDate: 2017-06-15
      DOI: 10.3390/economies5020021
      Issue No: Vol. 5, No. 2 (2017)
  • Economies, Vol. 5, Pages 1: Financial Reforms and Determinants of FDI:
           Evidence from Landlocked Countries in Sub-Saharan Africa

    • Authors: Husam Rjoub, Mehmet Aga, Ahmad Abu Alrub, Murad Bein
      First page: 1
      Abstract: The recognition of Foreign Direct Investment (FDI) as a source of funding to foster economic development in both developed and developing countries has been in ascendancy. The prime purpose of this study is to empirically investigate the determinants of FDI for the “landlocked countries” in Sub-Saharan Africa over the period 1995–2013. By employing panel data analysis, the result of the study revealed that domestic investment, trade (openness), human capital, political constraint, natural resource endowment and the market size (with the GDP growth as proxy) as having positive impact on determining FDI flow into the sample countries with only the countries’ tax policies seen otherwise. Our study not only contributes to existing literature on FDI determinants by investigating landlocked countries of Sub-Saharan Africa (SSA) for the first time but also includes natural resources that the landlocked countries are endowed with, tax policies and political constraints in such countries for the stipulated period.
      PubDate: 2017-01-01
      DOI: 10.3390/economies5010001
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 2: Acknowledgement to Reviewers of Economies in

    • Authors: Economies Editorial Office
      First page: 2
      Abstract: The editors of Economies would like to express their sincere gratitude to the following reviewers for assessing manuscripts in 2016.[...]
      PubDate: 2017-01-13
      DOI: 10.3390/economies5010002
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 3: Leaning against the Wind Policies on
           Vietnam’s Economy with DSGE Model

    • Authors: Phuc Huynh, Trang Nguyen, Thanh Duong, Duc Pham
      First page: 3
      Abstract: The global financial crisis of 2007–2008 had a negative impact on many countries, including Vietnam. Many policies have been applied to stabilize the macro-economic indicators. However, most of them are based on old qualitative models, which do not help policy makers understand deeply how each one affects the economy. In this paper, we investigate a quantitative macro-economic approach and use leaning against the wind policies with the Dynamic Stochastic General Equilibrium model (DSGE) to find a better way to understand how policies stabilize the Vietnamese economy. Based on the framework of Gerali et al., we calibrate the hyper-parameter for Vietnam financial data and do the comparison between the standard Taylor rule and the cases in which we add asset price and credit elements. The results show that the credit-augmented Taylor rule is better than the asset-price-augmented one under the technology shock and contrary to the cost-push shock. Moreover, the extended simulation result shows that combining both asset-price and credit rules on the model is not useful for Vietnam’s economy in both types of shock.
      PubDate: 2017-01-18
      DOI: 10.3390/economies5010003
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 4: Financial Deepening and Economic Growth Nexus
           in Nigeria: Supply-Leading or Demand-Following?

    • Authors: Tari Karimo, Oliver Ogbonna
      First page: 4
      Abstract: This paper examined the direction of causality between financial deepening and economic growth in Nigeria for the period 1970–2013. The study adopted the Toda–Yamamoto augmented Granger causality test and results showed that the growth-financial deepening nexus in Nigeria follows the supply-leading hypothesis. This means that it is financial deepening that leads to growth and not growth leading financial deepening. Among other things, the study recommended that policy efforts should be geared towards removing obstacles that undermine the growth of credit to the private sector, and must restore investors’ confidence in the stock market operations.
      PubDate: 2017-01-23
      DOI: 10.3390/economies5010004
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 5: The Impact of Terrorist Attacks on Foreign
           Exchange Rate: Case Study of Turkish Lira versus Pound Sterling

    • Authors: Mansoor Maitah, Jehar Mustofa, Gok Ugur
      First page: 5
      Abstract: In this study, the impact of terrorist attacks on exchange rate is estimated. Particularly, the study focuses on terrorist attacks in Turkey and its implication on Turkish lira versus pound sterling exchange rate. In order to find the causal effect, the study employed Autoregressive distributive lag (ARDL) bound testing approach as an estimation technique. Accordingly, the analysis reveals that a terrorist attack has a negative impact on the exchange rate in both the short-run and long-run. However, the negative effect of terrorism tends to be small in both the short-run and long-run. More precisely, terrorist attacks depreciate the exchange rate between Turkish lira and pound sterling by approximately 0.024% in the next trading day. The long-term effect also shows that a terrorist attack depreciates the exchange rate on average by 0.0706%.
      PubDate: 2017-01-28
      DOI: 10.3390/economies5010005
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 6: Examining the ‘’Natural Resource
           Curse’’ and the Impact of Various Forms of Capital in Small Tourism
           and Natural Resource-Dependent Economies

    • Authors: Petar Kurecic, Filip Kokotovic
      First page: 6
      Abstract: The problem of the relevance of human and natural capital, as well as the potential adverse effect of natural capital on economic growth, has gained increased attention in development economics. The aim of this paper is to assess, theoretically and empirically, the relevance of several forms of capital on economic growth in certain small economies that are dependent upon tourism or natural resources. The empirical framework is based on Impulse Response Functions obtained from Vector Autoregressive models in which we focus on the model where economic growth is the dependent variable for ten small economies that are dependent upon either tourism or natural resources. We find that there is evidence of the “natural resource curse”, especially in the economies that have a strong dependence on resources that are easily substitutable and whose prices constantly fluctuate. We further find that in the majority of observed cases, the type of capital these small economies are most dependent on for their economic growth causes negative impulses in the majority of the observed periods. Therefore, the main policy recommendation should be to assure that even these small economies should strive towards further diversification and avoid dependence on only one segment of their economy.
      PubDate: 2017-02-14
      DOI: 10.3390/economies5010006
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 7: Financial Reforms, Financial Development, and
           Economic Growth in the Ivory Coast

    • Authors: Vassiki Sanogo, Richard Moussa
      First page: 7
      Abstract: This study investigates the relationship between financial development and economic growth in the Ivory Coast over the period from 1961 to 2014. The final goal of this research is to develop a procedure to identify the effects of financial reforms for the Ivory Coast economic growth. Therefore, to achieve this goal, we first conducted a common component analysis (CCA) on our time series data to create: (1) a variable that would be the most appropriate proxy for the financial development; and (2) a vector of control variables for economic growth. Second, a vector autoregression model (VAR) with restriction was used as an appropriate specification of the dynamic relationship between the proxy of financial development, economic growth and other important factors of that growth (vector of control variables). Results suggest that in the Ivory Coast, growth in financial development is synonymous with the overall economic growth of the national economy. This study addresses the controversy over the appropriate proxy for the financial development in the Ivory Coast and it establishes a causal relationship between the financial development and the national economic growth.
      PubDate: 2017-02-24
      DOI: 10.3390/economies5010007
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 8: The Impact of Foreign Direct Investment (FDI)
           on the Environment: Market Perspectives and Evidence from China

    • Authors: Jiajia Zheng, Pengfei Sheng
      First page: 8
      Abstract: Foreign direct investment (FDI) may have a positive effect on the level of pollution in host countries, as described by the pollution haven hypothesis (PHH). However, this kind of effect may depend on the economic conditions in host countries. In this study, we conduct research on the FDI’s effect on China’s CO2 emissions during the market-oriented reform. The results are as follows. Firstly, FDI directly promotes China’s CO2 emissions. Secondly, with market-oriented reform, this positive effect from FDI is lowering year by year, which indicates that the market-oriented reform could alleviate the positive effect of FDI on China’s CO2 emissions. Thirdly, as China’s market-oriented reform was implemented gradually from experimental zones to the whole country, regional market development is uneven, and as such so is FDI’s effect on local CO2 emissions. Provinces in the eastern area generally evidenced higher market development and lower CO2 emissions from FDI, while four provinces in west area evidenced both lower market development and higher CO2 emissions from FDI.
      PubDate: 2017-03-06
      DOI: 10.3390/economies5010008
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 9: (Un)supported Current Tourism Development in
           UNESCO Protected Site: The Case of Old City of Dubrovnik

    • Authors: Ivana Pavlić, Ana Portolan, Barbara Puh
      First page: 9
      Abstract: The main purpose of this paper is to explore and determine perceptions of residents living in the United Nations Educational, Scientific and Cultural Organization (UNESCO) protected site Old City of Dubrovnik (OCD) towards tourism development. Uncontrolled tourism expansion has impact on local residents’ life and on their (un)support for specific form of tourism development. Comprehension of residents’ perceptions is crucial for realization of adequate tourism development and for mutual satisfaction of tourism demand and supply. Therefore, the aim is to test the model of residents’ perceptions of economic, socio-cultural and environmental impacts of tourism on their (un)support for specific form of tourism development. To realize the purpose of this research, Cronbach alpha, explorative (EFC) and confirmatory (CFA) factor analysis, and structural equation modeling (SEM) were applied. The findings indicate that there is a direct relationship between residents who perceive positive and negative economic, socio-cultural and environmental impacts of tourism and their (un)support for tourism development. This paper points out the role and significance of the permanent residents’ perceptions research concerning the issues that are related to the quality tourism development due to the high interaction between local residents, tourists and local tourism development especially in the areas under the protection of UNESCO.
      PubDate: 2017-03-07
      DOI: 10.3390/economies5010009
      Issue No: Vol. 5, No. 1 (2017)
  • Economies, Vol. 5, Pages 10: The Status and Evolution of Energy Supply and
           Use in Mexico Prior to the 2014 Energy Reform: An Input-Output Approach

    • Authors: Zeus Guevara, Oscar Córdoba, Edith García, Rafael Bouchain
      First page: 10
      Abstract: In 2014, the Mexican government approved a bold energy reform that allows private energy companies to freely participate in the energy market (something prohibited during the previous eight decades). This reform is expected to significantly restructure the energy sector and boost and diversify the energy production. Moreover, changes in the energy sector and production might lead to structural changes in the rest of the economy and ultimately generate significant economic benefits for the country. Nevertheless, the fundamental role of the energy sector in this oil producing country makes the potential impacts of the reform complex to forecast. The objective of the study is to analyze the current state, evolution, and driving factors of the total primary energy use in Mexico in 2003–2012 (prior to the implementation of the reform) as a precedent for future analyses of impacts of the energy reform. The results show three driving factors of the evolution of primary energy use: final non-energy demand, direct energy intensity, and economic structure. Also, it was found that the energy sector has been in a precarious situation regarding its structure and efficiency. However, this situation had a small effect on the evolution of primary energy use.
      PubDate: 2017-03-21
      DOI: 10.3390/economies5010010
      Issue No: Vol. 5, No. 1 (2017)
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