Asymmetric Effects of Real Exchange Rate on Trade Balance in Cote d’Ivoire: Evidence from Nonlinear ARDL Approach

This paper analyses the effects of real exchange rate on the trade balance in Cote d’Ivoire using times series from 1975 to 2017. Although many studies have investigated this issue, most of them assume that this relationship is symmetric. This paper relaxes this assumption employing the nonlinear autoregressive distributed lag (ARDL) model by Shin, Yu and Greenwood-Nimmo (2014). The results show that trade balance responds stronger to negative shocks in real exchange rate than to positive ones in the long-run, while the short-run response of trade balance is symmetric.

Trade Openness and the Impact of Foreign Direct Investment on CO2 emissions: Econometric Evidence from ECOWAS Countries

This study examines the effect of trade openness on the relationship between foreign direct investment (FDI) and carbon dioxide emissions in ECOWAS Countries. It applies the bounds testing approach to cointegration to annual data covering the period 1970 to 2010. The empirical evidence supports the environmental Kuznets curve for four countries (Cote d’Ivoire, Gambia, Mali and Niger). In most cases, economic growth and population contribute to environmental degradation. More interestingly, the effect of FDI on CO2 emissions is contingent on trade openness. This effect is positive and increases with the degree of trade openness in Burkina Faso, Gambia and Nigeria, suggesting that trade and FDI are complementary in worsening environmental quality. The effect of FDI decreases with trade in Ghana, Mali and Togo while in the case of Benin, Niger, Senegal and Sierra Leone, FDI has no significant long-run effect on CO2 emissions. Keywords: Foreign Direct Investment, CO2 emissions, Trade openness, ECOWAS.

Foreign Direct Investment and Exports Nexus: Cointegration and Causality Evidence from Cote d’Ivoire

This paper examines the relationship between foreign direct investment (FDI) and exports in Cote d’Ivoire using data covering the period 1970 to 2007. The residuals-based test of Gregory and Hansen (1996) shows that the two variables are cointegrated. The Granger causality tests reveal a long-run causal relationship running from exports to FDI, whereas no short term causal link has been found. Keywords: Exports; Foreign direct investment; Cointegration; Granger causalit

Budget Deficit and Economic Growth in Cote d’Ivoire: A Search for Threshold

This study examines the effect of budget deficit on economic growth in Cote d’Ivoire. The study applies threshold regression model to annual data covering the period 1970-2022. The results show that fiscal policy significantly influences economic growth rate. Further, the study establishes that the threshold level of budget deficit conducive for economic growth is 4% of GDP. Beyond this threshold, budget deficit is detrimental to economic growth. As the actual budget deficit is above 4%, the study recommends measures aimed at increasing domestic revenue and enhancing efficiency of public spending to enable the country reap more economic growth associated with fiscal policy. In this regards, efforts should be deployed to reduce tax revenue losses from exemptions and evasion which represent a potential of 4.2% of GDP, i.e. more than FCFA 1800 billion. Under certain assumptions, the “true” budget deficit threshold of Cote d’Ivoire is around 2% of GDP

Revisiting the Income, Energy Consumption and Carbon Emissions Nexus: New Evidence from Quantile Regression for Different Country Groups

The Environment Kuznets Curve (EKC) hypothesis has been widely tested in the energy economics literature. However, previous studies focused only on the mean effects and have not yet examined the role of pollution levels in the income-pollution nexus. This paper uses quantile regression to reexamine the effect of economic growth and energy consumption on dioxide carbon (CO2) emissions for five panels of 59 countries. The results reveal that energy consumption increases CO2 emissions in all panels, the effect being larger in low pollution countries. They also provide evidence supporting the EKC hypothesis for Sub-Saharan, American and European countries at all quantiles, and for Asian and MENA countries at lower levels of CO2 emissions. These findings suggest that economic growth is not everywhere and always the cause and the cure of pollution. Therefore, environmental control policies should be tailored differently across low and high pollution countries. Keywords: Carbon dioxide (CO2) emissions, economic growth, energy consumption, quantile regression JEL Classifications: C23, F18, O58, Q53

Relationship between Savings and Economic Growth in Cote d'Ivoire

This study examines the relationship between domestic savings and economic growth in Cote d'Ivoire during the period from 1970 to 2016. The study employs the bounds testing approach to cointegration and the Granger causality test in the examination of this relationship. The results show that in the short and long run, domestic savings is positively and significantly related to economic growth. The Granger causality results favor the conventional view that savings precede and cause economic growth. The role played by domestic savings becomes crucial in supporting the economic growth of Cote d'Ivoire. Keywords: domestic savings, economic growth, causality, causality, Cote d'Ivoire. JEL Classifications: C32, E21, O40, O55 DOI: https://doi.org/10.32479/ijefi.878

Do Foreign Direct Investment and Trade lead to Lower Energy Intensity? Evidence from Selected African Countries

The aim of this study is to examine the impact of foreign direct investment (FDI) and trade on energy intensity in a sample of six Sub-Saharan countries. It applies the bounds testing approach to cointegration and Granger causality analysis to annual data covering the time period from 1970 to 2011. The results indicate evidence for energy-reducing effect of FDI in Benin and Nigeria, while in Cote d'Ivoire and Togo, energy efficiency declines as FDI increases. The results also indicate that energy intensity is negatively affected by imports in Cameroon, Cote d'Ivoire and Togo, suggesting that trade improves energy efficiency. Results of Granger causality suggest that in the short-run, energy intensity is caused by FDI in Cote d'Ivoire and Nigeria, and by imports in Cameroon and Nigeria.  Keywords: Foreign direct investment; trade; energy intensity. JEL Classifications: C32; F21;  Q4

Revisiting the Financial Development and Poverty Reduction Nexus for Sub-Saharan African Countries: Evidence from Causality Tests in the Time and Frequency Domains

This study reexamines the causal relationship between financial development and poverty reduction for six African countries. To that end, we employ the Granger causality tests in the time and frequency domains. The results from time domain causality analysis indicate that financial development does not causes poverty reduction directly, but poverty reduction causes financial deepening in Nigeria and South Africa. While the frequency domain analysis shows evidence of bidirectional causality between financial development and poverty reduction for Cameroon in long run, and causality from finance to poverty reduction for Gabon in long term. Furthermore, causality from poverty reduction to financial development exists for Nigeria both in short and medium terms and for South Africa over the short, medium and long terms. Keywords: Poverty reduction, financial development, frequency domain analysis, Sub-Saharan Africa JEL Classifications: C32, G21, I30, O55

Revisiting the Exports and Economic Growth Nexus: Rolling Window Cointegration and Causality Evidence from Cote d’Ivoire, Malaysia, Pakistan and South Africa

This paper reexamines the relationship between exports and economic growth in Cote d’Ivoire, Malaysia, Pakistan and South Africa using time-varying cointegration and causality tests. The cointegration results suggest that exports, investment in physical capital and GDP move together in the long-run in the four countries. Furthermore, the full sample Granger causality tests support the export-led growth hypothesis for Malaysia and Pakistan, and the growth-led exports hypothesis for South Africa. However, the rolling window cointegration and causality tests show that the long-run and also the causal relationships between exports and GDP are time-varying. For most time periods we do not find any causal relationship between exports and GDP. There are, however, sub-periods during which unidirectional or bidirectional causal relations were found. Therefore, export-promoting strategies are not always effective tools to stimulate economic growth