Resource abundance, financial crisis and economic growth: did resource-rich countries fare better during the global financial crisis?

This study examines the role of resource abundance in the cross-country differences in the impacts of the global financial crisis (GFC) of 2008–2009. Using forecasts from the unobserved components model and exponential smoothing technique, we estimate the output levels a country would reach in 2009 and 2013 in the absence of the GFC, and compare these with the realised output levels. We find large variations in the output losses across 72 countries. The mineral-rich countries have been found to be in a strong position to survive any adverse shocks stemming from the GFC. Income per capita, trade openness, and institutional quality and government effectiveness are also found to be key factors determining the differences in output loss in the post-crisis period. These findings have strong implications for resource-rich countries such as Australia and are expected to shed new light on alternative policy designs and appropriate strategies to deal with any future economic crisis

Does liberalization cause economic growth? An experiment with Bangladesh data

Abstract not available

The impact of globalization on Islamic countries: A brief assessment

After briefly discussing the various issues pertaining to Globalization and the global economy, the paper presents the comparative economic performance of the Islamic countries by using appropriate statistics and discusses the challenges, mainly the economic ones. It is stressed that the Islamic countries, at least a subset of them, have great potential and would benefit from globalization, if they can successfully upgrade their young labor force through various education and training programs. Though steps are being taken in the right direction in some Islamic countries (particularly GCC countries), more comprehensive measure are required for human capital formation so as to meet the needs of today's knowledge-based economy, argued in the paper

Religion and development: Are they complementary?

Given that religion drives people's behavior and actions in a more productive direction, it is not possible to separate religion from development. After a meticulous review of theory and empirical literature, the paper concludes that the relationship between religion and development is likely to be complementary as long as religious beliefs and practices promote 'moderation' rather than 'extremes'. A peaceful co-existence of various religious groups (or sects) within a country and nations with multiple religious affiliations within the global community at large remains the essential prerequisite for growth and prosperity in today's highly interconnected world, argued in the paper

Economic policy implications for socio-economic development in a fast-growing economy: the case of Malaysia

We seek to study the link between economic policy changes and socio-economic development in Malaysia that has shown impressive growth over the years. The country has experienced significant policy changes since independence in 1957, but the main focus of promoting the native Malay (Bumiputera) interest remains. Currently Malaysia is classified by the World Bank as an 'upper middle-income' country and it aims at becoming a high-income, inclusive and sustainable economy as part of its Vision 2020. While the New Economic Policy, the New Development Policy, the National Vision Policy and the New Economic Model - all driving the country towards its Vision 2020, promoting Bumiputera interests directly or indirectly in today's competitive world might be seen as an obstacle towards achieving the Vision, argued in the paper

Liberalization and growth: An econometric study of Bangladesh

Bangladesh adopted a liberal economic regime, particularly in the areas of trade, finance, and capital account, since mid-1980s. This study seeks to evaluate the impact of liberalization on the country's economic growth by analyzing the 1974-2002 data with the help of cointegration and error correction methods. The empirical results suggest that long-run economic growth in Bangladesh is largely explained by physical capital and real interest rate and growth remains unaffected by short-term changes in labor force and secondary enrollment ratio. While financial liberalization has had significant negative impacts on economic growth implying that financial reforms failed to attract new investment due to adverse investment climate, the effects of trade and capital account liberalizations were rather insignificant, possibly due to weak supply response and lack of credibility of such reform programs. Bangladesh will not reap the full benefits of any comprehensive liberalization measures unless it can improve infrastructure and quality of governance, the paper argues

The impact of economic reforms on growth: a case study of Bangladesh

This study makes a brief assessment of the consequences of economic reforms that included a series of liberalization measures on Bangladesh's growth process by analyzing the 1974-2007 data with the help of cointegration, error correction, and Granger causality tests. The results suggest that long-run economic growth in Bangladesh is largely explained by investments in both physical and human capital, trade openness, and financial as well as capital account liberalization. While the causality runs in both ways between capital account liberalization and economic growth, it runs only in one direction from physical capital and financial liberalization to economic growth in the short-run. Interestingly, growth is not affected by trade openness in the short-run. While trade liberalization and capital account liberalization have had significant positive impacts on economic growth in the long-run, the effects of financial liberalization were found to be significantly negative. This emphasizes the need for ensuring real sector development as a prerequisite for the success of financial liberalization

Social expenditure and economic growth: Evidence from Australia and New Zealand using cointegration and causality tests

Developed nations, especially Nordic countries such as Iceland, Sweden, Norway, Denmark and Finland allocate a sizeable portion of their budget for social welfare. On the contrary, developing counties' allocation for social welfare has been negligible. The question is: can state intervention through social welfare provisions ensure sustained economic growth? In other words, do social expenditures promote economic growth? This study seeks to answer this question by establishing links between social expenditures and economic growth in Australia and New Zealand, and draw lessons for fast developing ASEAN economies as they aspire to be developed nations soon. Using annual data from 1980 to 2012, we deploy cointegration and error correction methods for establishing long-run relationship between social expenditures and economic growth. We conduct Granger causality tests for testing short-term direction of causality among the variables. For Australia, economic growth is found to have three main determinants- education, health and social expenditures. For New Zealand, health and social expenditures have been found as the main determinants of growth. However, no long-run relationship could be established among the variables when we included budget deficit in our model. The Granger causality tests indicate that one way causality running from economic growth to health expenditure, and social expenditure to economic growth in Australia. In case of New Zealand, on the other hand, one-way causality runs from education expenditure to economic growth, health expenditure to education expenditure, economic growth to health expenditure, and education expenditure to budget deficit. Social welfare expenditures also Granger cause economic growth. Our findings suggest that social expenditures promoted growth in Australia and New Zealand. The fast developing economies such as Singapore and Malaysia, which aim to achieve the developed country status by 2020 and usually do not allocate sizeable portion of their budget for social welfare, should adopt more 'generous' social policies for the sake of a balanced development

Religion and development: Are they complementary?

Given that religion drives people's behavior and actions in a more productive direction, it is not possible to separate religion from development. After a meticulous review of theory and empirical literature, the paper concludes that the relationship between religion and development is likely to be complementary as long as religious beliefs and practices promote 'moderation' rather than 'extremes'. A peaceful co-existence of various religious groups (or sects) within a country and nations with multiple religious affiliations within the global community at large remains the essential prerequisite for growth and prosperity in today's highly interconnected world, argued in the paper