International Advances in Economic Research

Al Marhubi, Fahim

2023 International Advances in Economic Research

doi: 10.1007/s11294-023-09877-8

In recent years, there has been a burgeoning literature exploring the effects of gender discrimination on macroeconomic outcomes ranging from productivity and gross domestic product per capita to economic growth. A separate literature in recent decades on the time-inconsistency of monetary policymaking has examined the role of labor market distortions in explaining differences in cross-country inflation rates. This paper brings these two disparate streams of research together and explores the impact of gender discrimination laws on inflation. Using the World Bank’s index of gender discrimination laws from the Women, Business and Law database, the results from the system generalized method of moments estimator applied to 117 countries over the period 1970–2019 indicate that gender discrimination laws have a positive causal impact on inflation. This effect is robust to different specifications and estimation methodologies. From a policy perspective, the findings suggest that labor market reforms aimed at reducing gender discrimination laws can be an effective mechanism in promoting low inflation.

Angelidis, Georgios; Varsakelis, Nikos C.

2023 International Advances in Economic Research

doi: 10.1007/s11294-023-09871-0

This paper examines the role of some key economies in the economic contagion across global value chains using input-output analysis and complex network statistics. The empirical research focuses on China, France, Germany, Italy, Japan, Korea, the United Kingdom, and the United States. A range of novel measures were used to measure the nature and extent of global value chain relationships. The empirical results reveal that, because of the high interdependence and interconnectedness in the global value chain networks, the transmission of an economic shock in China and the United States will be fast, wide, and in-depth in the global value chain networks. Sample countries are more exposed to an economic shock in China than a shock in the other four big economic partners, namely the United States, Germany, Japan, and Korea.

Siopi, Evaggelia; Poufinas, Thomas

2023 International Advances in Economic Research

doi: 10.1007/s11294-023-09873-y

This paper studies the impact of internal and external factors on the profitability and financial strength of insurance groups across the European Union, focusing on the effect of the European sovereign debt crisis and the Solvency II Directive, which has not been addressed by the literature. The findings reveal that the efficiency of accounts receivable management and the state of the economy have a significant positive impact, whereas the underwriting risk and size have a significant negative impact on profitability and financial strength. Furthermore, long-term interest rates exert a significant positive influence, whereas the purchase of reinsurance, size of the domestic market, market structure, and inflation exert a significant negative influence on profitability. The European sovereign debt crisis has a significant negative impact on profitability and a positive but insignificant impact on financial strength. Solvency II has no statistically significant impact either on profitability or on financial strength. This paper contributes to the literature through the identification of the impact of the European sovereign debt crisis and Solvency II, which has not been depicted so far, as well as the impact of a series of internal and external factors on profitability and, for the first time, on financial strength.

Etta-Nkwelle, Maru; Hunte, Cyril K.; Augustine, Carlton

2023 International Advances in Economic Research

doi: 10.1007/s11294-023-09872-z

The purpose of this paper is to ascertain whether there is a positive relationship between cross-border transport infrastructural integration and income growth across Africa. The study employed the generalized method of moments technique and principal component analysis to develop a composite transport index and sample data from Globaleconomy.com for 28 African countries. There is a robust and positive relationship between transport infrastructural integration and income growth across Africa. The analysis also shows that the average sample transportation infrastructural integration index is 6.62, with an average per capita income of $5417.43, and an average gross domestic product growth rate of 4.43%. In contrast, countries that belong to a regional economic group such as the Southern African Customs Union (SACU) have an average per capita income of $10,174.02, and a transportation infrastructural integration index of 8.12, which is above the sample average. The sample contains ten landlocked countries, with a below sample average per capita income of $4219, a gross domestic product growth rate of 5.04%; and a transportation infrastructural integration index of 6.15. However, a novel finding of this analysis is that SACU landlocked members, when compared with all landlock countries, have a higher transportation infrastructural integration index (6.60), and a higher average per capita income ($8641.71). Therefore, this analysis confirms that increasing transport infrastructural integration across landlocked countries, together with joining regional economic integration groups, such as SACU, will increase average per capita incomes, and this will be transformational for Africa.

Suárez-Cuesta, David; Latorre, Maria C.

2023 International Advances in Economic Research

doi: 10.1007/s11294-023-09875-w

This study offers a computable general equilibrium analysis of the $550 billion devoted to new infrastructure investment (new and remodeled physical infrastructure for transportation, information and public services) in the United States under the Infrastructure Investment and Jobs Act, a federal law signed by President Joseph Biden in November 2021. The simulations are based on the state-level distribution of funds and distinguish between the construction phase (short run) and the operational phase (long run). Gross domestic product (GDP) and labor demand react to the government spending stimulus after the first year by growing 0.24% and 0.44%, respectively. The gains derived from this investment plan are higher in the long term once investments increase the country’s capital stock; GDP increases by 1.39% and wages by 3.94%. This paper analyzes the efficiency of the current distribution of funds across sectors, and finds that the current distribution benefits the United States economy more. Even though a slightly higher GDP impact could have been reached (1.42%) if all the funds were devoted to transport services, the price increases would result in lower real wage increases.

Siddiq, Fazley K.; Klymentieva, Halyna; Lee, Taylor J. C.

2023 International Advances in Economic Research

doi: 10.1007/s11294-023-09874-x

The population distribution in Canada across subnational jurisdictions exhibits significant inequality. Precipitous growth within concentrated urban agglomerations, culminating in severe rural depopulation, has perpetuated existing subnational population growth disparities. More densely populated metropolitan areas are experiencing an increasing proportion of the aggregate population, while ruralized jurisdictions succumb to a dramatic population exodus. Accordingly, the geographic dispersion of the Canadian population has become increasingly skewed, and thus a substantial proportion of the national populace is concentrated within a handful of metropolitan jurisdictions. The localization of growth within urbanized zones renders the geography of the population distribution increasingly volatile, thereby carving a fault line into the landscape of the national economy. Using census data from 1991 to the most recent (2021), this study formulates a novel quantification of the unequal distribution of population in Canada over time, utilizing an adaptation of the Lorenz curve and the Gini coefficient. The findings exhibit significant and growing inequality in the population distribution with a substantial proportion of the national populace concentrated within a few metropolitan areas. Rising rent and real estate prices have led to increasing gentrification, fundamentally altering the economic and social reality of the country.

Guo, Baoping

2023 International Advances in Economic Research

doi: 10.1007/s11294-023-09876-9

Much literature demonstrated the existence of general trade equilibrium in the Heckscher-Ohlin model, but no analytical solution has been reported yet. Dixit and Norman made a breakthrough showing that whole factor-price equalization set in integrated world equilibrium (IWE) shares the same world price. Helpman and Krugman enhanced the result, presenting the equal trade volume lines in the IWE diagram. Their ideas explored the new property and clue of trading equilibrium. Inspired by their ideas, this paper derives the price-trade equilibrium using Helpman and Krugman’s equal trade volume lines and shows that world prices are the function of world factor endowments. The current study finds that the relative price of two factors at equilibrium is inversely propositional to their world factor endowments, which simulates the law of demand. The study demonstrates that the equalized factor prices ensure gains from trade for both countries. With the equilibrium, the Heckscher-Ohlin theorem and factor-price equalization theorem are linked together by term of trade. They can explain each other. Trefler illustrated that the factor price equalization hypothesis and the Heckscher-Ohlin-Vanek theorem hold in his equivalent-productivities system (effective endowments). The integrated price-trade equilibrium will be helpful to understand the equilibrium of factor price non-equalization.