Search

To mitigate environmental problems and to achieve sustainability, China is striving to transition to low-carbon urban economies. Among several significant steps, the country has made remarkable success in controlling the emissions from transportation, buildings, and energy by shutting down or relocating several polluting industries. This study contributes to the issue of sustainable growth debate using time series data from China for the period 1998-2017 and empirically examines the effects of green investment and renewable energy consumption on production-based carbon emissions for China. The strength of this study is that it tested some new variables such as production-based carbon emissions and green investment. Using autoregressive distributed lag model (ARDL) cointegration technique, we found that production-based emission and its determinants move together in the long run. The study found that green investment and renewable energy consumption are both helpful in controlling production-based carbon emissions, while trade openness increases production-based carbon emissions. Hence, green investment and renewable energy consumption contribute to the achievement of sustainable growth. Moreover, based on a robustness check, human capital, financial development, and environment-specific technological innovation are found to be helpful in curbing production-based carbon emissions. Our study recommends financial technology (fin-tech), green investment, and public-private partnership investment in renewable energy to mitigate the effect of production-based carbon emissions.

Most of the member countries of COP21 have been struggling to devise relevant policies in order to control carbon dioxide (CO2) emissions since the Paris agreement in 2015. In our view, without analyzing the role of two extremely important variables i.e., ecological innovation and export diversification, in the whole chain of carbon emissions, expecting significant results from such policies would be far fetched. This study, therefore, is aimed to explore the effect of export diversification (ED) and ecological innovation (EI) on carbon emissions for G-7 countries from 1990 to 2017, along with renewable energy consumption (REC) as an important control variable. The results show that export diversification (ED) increases carbon emissions; however, ecological innovation (EI) helps reduce carbon emissions, and similarly, renewable energy consumption (REC) also controls carbon emissions. More important, however, is the realization that the negative impact of export diversification on the CO2 emissions gets weakened as the degree of environmental innovation increases. Based on our findings, the promotion of renewable energy, along with the adoption of environmentally friendly technology, is strongly recommended for G-7 countries. Our results also highlight that Government policies regarding export diversification (ED), ecological innovation (EI), and renewable energy consumption (REC) approximately take more than a year to be able to deliver the results effectively.

In this seminal work, we introduce the role of institutions and knowledge spillovers in reversing the Dutch disease phenomena and providing a basis for future work. Hence, this study fills the existing literature gap by including institutional quality and knowledge spillovers in testing the Dutch disease hypothesis in Brazil, Russia, India, China, South Africa (BRICS) countries. We analyzed the combined effect of FDI spillovers and remittances inflow on the real effective exchange rate from 1989 to 2019. There is a cointegration relationship among the variables in all aggregate sample models and all the BRICS country's cross-sections. We find that knowledge spillover and institutional quality are important factors contributing to the appreciation of the real effective exchange rate in BRICS countries. This study suggests that for reversing Dutch disease phenomena, BRICS countries need to improve their institutions regarding policy implications. Quality institutions will facilitate remittances to be absorbed into investment activities. Hence, the development of institutions will bring more significant economic growth in the short-run and the long run.

Purpose The purpose of this paper is to investigate the causal link between foreign direct investment (FDI) and exports in China based on the knowledge capital model (KK model, Markusen, 2002). Design/methodology/approach The bootstrap Granger full-sample and sub-sample rolling window causality test is used to determine whether FDI can promote exports. Findings The full-sample causality test indicates no causal relationship from FDI to exports. However, considering structural changes of exports and FDI, the authors’ find that the full-sample test is not reliable. Instead, the authors use the rolling window causality test to revisit the dynamic causal relationship, and the results present significant effects from FDI on exports, mostly around periods in which the proportion of FDI from Hong Kong, Macao and Taiwan is increasing. Specifically, positive impacts of FDI on exports are stronger than the negative impacts in China. Research limitations/implications The findings in this study suggest a significant time-varying nature of the correlation between FDI and exports. The promotion effect of FDI to exports is proved by the rolling window approach; it thus supports the KK model that divides FDI into lateral FDI and vertical FDI and proves that the constitution of FDI is critical to the relationship between FDI and exports. Practical implications China has been facing adjustment of its economic structure in recent years, and in this situation, increasing the proportion of FDI that can bring advanced production function is critical for the industrial structural adjustment. Originality/value This paper uses the bootstrap rolling window causality test to investigate the time-varying nature of the causality between FDI and exports, considering structural changes for the first time. The authors further deepen the previous research and draw a more realistic conclusion.

Fourth industrial revolution has brought with it a consistently growing use of technology in all fields of life, including finance and investment. Amidst all this, Bitcoin also emerged on the surface of the financial markets in 2008, as one of the biggest innovations of our century. However, since then, it has largely been scrutinized for the benefits and risks that it puts forth in terms of the economic growth, financial system's stability and the welfare of overall society. In this study, we evaluate how the financial industry can use Bitcoin for improving the efficiency and wealth of the society, by focusing on portfolio optimization. Our results show that Bitcoin has an enormous tendency to improve an investor's risk-return profile. This efficiency is clearly visible in the upward shifts of the efficient frontiers, once Bitcoin is added in the universe of investable assets. Bitcoin's efficiency is valid for when the short selling was, and, was not restricted. It is important to note that our findings are based on the data that spans over a timeframe of a decade, and provides a medium to long term perspective on Bitcoin, which was not the case with the earlier studies.

This study applies bootstrap panel Granger causality to test the relationship between urbanization and the urban-rural income gap in China. We find that patterns of interaction between urbanization and the urban-rural income gap vary according to different regions. Empirical results show that urbanization does Granger-cause an urban-rural income gap, mainly in the Eastern region of China. In one-third of all provinces, the urbanization levels have a significant impact on the urban-rural income gap; however, the urban-rural income gap does not play a significant role in urbanization. The Eastern region's result is also in line with Kuznets's (1955) theory. These results could help regional governments develop fair policies for urban and rural income distribution in the process of urbanization of different regions.

This study applies Narayan and Popp's (2010) unit-root test with two endogenous breaks to assess the validity of long-run real interest rate parity (RIRP) via investigating the non-stationary properties of the real interest rate convergence relative to South Africa for ten African countries. This method has been proven to be more powerful than the other unit root models with two breaks (Narayan and Popp, 2013). Our findings clearly indicate that RIRP holds true for five countries, which implies that the choices and effectiveness of the monetary and fiscal policies in the African economies will be highly influenced by external factors originating from South Africa. Our results have important policy implications for these African countries under study.

In this study, we apply flexible Fourier stationary unit root test proposed by Enders and Lee (2012) to assess the non-stationary properties of the per capita real gross domestic product (GDP) for 32 African countries. We find that Fourier stationary unit root test has higher power than linear method if the true data-generating process of per capita real GDP is in fact a stationary nonlinear process of an unknown form with structural change using the low frequency components. We investigate the stationarity of per capita real GDP from the nonlinear point of view and provide robust evidence that clearly indicates that real output is well characterised by a nonlinear, mean-reverting process, namely Benin, Botswana, Burundi, Cameroon, Senegal, Sierra Leone and South Africa. Our evidence points that these seven countries are nonlinear stationary, implying that per capita real GDP follows a steady rate of growth, and policy innovations then have temporary effects. These results have important policy implications for African countries.

Ovaj rad koristi TAR autoregresijski model kojeg su osmislili Caner i Hansen (2001) za istraživanje linearnosti i stacionarnosti njemacke realne tecajne stope u odnosu na njenih 5 zemalja trgovinskih partnera. Donose se dva glavna zakljucka. Prvo, empirijski rezultati ukazuju na to da je njemacki realni tecaj nelinearni proces. Drugo, jedinicni korijen u realnoj tecajnoj stopi je odbacen za vecinu istraženih slucajeva. Takav rezultat snažno podupire paritet kupovne moci za Njemacku u odnosu na njene glavne trgovinske partnere.