Search

The self‐sustainability of microfinance institutions (MFIs) is a growing concern as they work as non‐profit organizations to achieve global poverty reduction goals. This study aims to examine the MFIs' self‐sustainability using an efficiency measurement technique based on Data Envelopment Analysis (DEA). It also determines the influence of different financing sources on MFIs' self‐sustainability as well as the moderating impact of external governance on this relationship. It uses the Generalized Method of Moments (GMM) estimator to analyze the panel data from 661 MFIs in 86 countries during the 2010–2018 period. The DEA analysis reveals that MFIs are still in the intermediate stage of self‐sustainability in terms of technical and cost efficiency. The second‐stage regression results reveal that financing sources such as retained earnings and equity have a robust positive and statistically significant effect on the MFIs' self‐sustainability, implying that MFIs that rely more on these two sources are more likely to be self‐sustainable. The moderation analysis reveals that good governance accelerates the positive effect of financing sources on MFIs' efficiency. Given these empirical findings, MFIs' decision‐makers can benefit from considering their own funding and equity. Quality governance can be ensured by government agencies and regulatory bodies to support the MFIs' sustainability. [ABSTRACT FROM AUTHOR]

This study examines the impacts of globalization and energy consumption on economic growth in 10 low‐income countries during the 1990–2017 period. It also determines the causal relationship between globalization and energy consumption. It disaggregates overall globalization into economic, social, and political dimensions, as well as disaggregates total energy consumption into renewable and non‐renewable energy. It employs the Fully Modified Ordinary Least Squares, Instrumental Variables approach, and Dumitrescu‐Hurlin Granger non‐causality technique to account for heterogeneity, endogeneity and cross‐sectional dependence. The results show that overall globalization has a positive impact on economic growth in low‐income countries. But when it disaggregates globalization into economic, social and political dimensions, the results reveal that social and political dimensions boost economic growth while economic dimension undermines economic growth. Moreover, the results show that energy consumption is a significant determinant of economic growth. But when it disaggregates energy consumption into renewable and non‐renewable energy, the results reveal that non‐renewable energy consumption has a positive impact on economic growth, while the impact of renewable energy consumption is tenuous. The results also show a unidirectional causality from globalization to energy consumption, suggesting that globalization enhances energy consumption. This study implies that overall globalization and total energy consumption are significant determinants of economic growth, Therefore, efforts to accelerate economic growth should incorporate both globalization and energy consumption in low‐income countries. However, low‐income countries should appraise the dimensions of globalization and energy consumption that are not growth‐enhancing with a view to making them drivers of economic growth. [ABSTRACT FROM AUTHOR]

This paper analyses the variables that moderate the impact of financial development on economic growth based on theoretical and empirical evidences. We show that financial and economic development, institutions and macroeconomic stability are the fundamental variables that moderate the finance‐growth nexus. Specifically, higher levels of financial and economic development, institutional quality and macroeconomic stability promote the impact of financial development on economic growth, while lower levels of these variables could have the opposite effect. We also show that too much finance is deleterious to economic growth, suggesting the existence of a threshold level of financial development beyond which further finance inhibits, rather than enhances growth. The economic implication of this study is that a stable macroeconomic environment, higher level of institutional quality, optimum financial and economic development are necessary conditions for finance to accelerate growth. Hence, countries that want to promote economic growth through the financial sector should give adequate priority to these variables. [ABSTRACT FROM AUTHOR]

This paper examines the nexus between tourism, financial development and economic growth in 31 African countries using the Dumitrescu–Hurlin Granger non‐causality test that accounts for heterogeneity and cross‐sectional dependence. It also employs the Granger causality test in the frequency domain that distinguishes between temporary and permanent causality for the country‐specific analysis. It shows a cointegration relationship between tourism, financial development and economic growth. It reveals a joint long‐run causality from tourism and financial development to economic growth, and a joint short‐run and long‐run causality from tourism and economic growth to financial development, albeit the joint causality from financial development and economic growth to tourism is tenuous. The individual causality shows a bidirectional causality between tourism and economic growth, between financial development and economic growth, and between tourism and financial development. The country‐specific analysis reveals that tourism is a significant predictor of financial development and economic growth at high frequency rather than at low frequency in most countries. Therefore, African countries should prioritize the policies and programs that can facilitate the development of the tourism and financial sectors in their quest to accelerate economic growth and development. [ABSTRACT FROM AUTHOR]

This paper examines the nonlinear impact of real GDP per capita on financial development in a panel of 125 countries. It also determines the moderating effect of inflation on the impact of GDP on financial development. It employs the dynamic panel system generalized method of moments (GMM) and the dynamic common correlated effects (CCE) to do both panel and country‐specific analysis, as well as control for cross‐sectional dependence, heterogeneity and endogeneity. This study shows that GDP has a positive impact on financial development in the entire panel. However, when we split the panel into different income groups, we find a positive impact in the high‐ and middle‐income groups while the impact is insignificant in the low income group. Although we find no evidence of a nonlinear impact of GDP on financial development in the panel, the country‐specific analysis reveals a significant nonlinear relationship between GDP and financial development in 73 countries. We also show that inflation adversely moderates the positive impact of GDP on financial development in middle‐income countries. This study implies that the relationship between GDP and financial development depends on the levels of GDP and inflation rate. We recommend some policy options based on the findings. [ABSTRACT FROM AUTHOR]

This paper compares the impact of financial development on economic growth in the Union Économique et Monetaire Ouest Africaine (UEMOA) and non‐UEMOA countries. It also examines the finance‐growth nexus before and after the formation of UEMOA, as well as the indirect effect of economic union on economic growth through the financial sector. The study reveals a significant difference in the finance‐growth nexus between UEMOA and non‐UEMOA countries. Specifically, financial development has a robust positive impact on growth in UEMOA countries, while the impact is tenuous in non‐UEMOA countries. However, we find no remarkable difference in the finance‐growth nexus before and after the formation of UEMOA. We also reveal that economic union has no robust indirect effect on economic growth via the financial sector. The economic implication is that UEMOA could have economic benefits, but financial development is not a channel through which it influences growth. Therefore, it is necessary to reposition the union so that it can enhance the impact of finance on growth. [ABSTRACT FROM AUTHOR]