No abstract

This paper utilizes cointegration and the vector errorcorrection model (VECM) to explore the causal relationship between economic growth and growth rate of domestic savings for Congo, Côte d'Ivoire, Ghana, Kenya, South Africa, and Zambia. Specifically, three analyses were undertaken. First, the time series properties of economic growth and domestic savings were ascertained with the help of the augmented Dickey-Fuller unit root procedure. Second, the long-run relationship between economic growth and growth rate of domestic savings was examined in the context of the Johansen and Juselius (1990) framework. Finally, a Granger-causality test was undertaken to determine the direction of causality between economic growth and growth rate of domestic savings. The results indicate one order of integration [I(1)] for each of the series. The results of the cointegration tests suggest that there is a long-run relationship between economic growth and growth rate of savings. The results from the Grangercausality tests indicate that contrary to the conventional wisdom, economic growth prima facie causes growth rate of domestic savings for most of the countries under consideration.Résumé: Le présent document utilise la co-intégration et le modèle à vecteur de correction des erreurs (VECM) pour étudier les relations de cause à effet entre la croissance économique et les taux de croissance de l'épargne intérieure au Congo, en Côte d'Ivoire, au Ghana, au Kenya, en Afrique du Sud et en Zambie. Plus précisément, trois analyses ont été effectuées. La première a vérifié les propriétés des séries chronologiques de la croissance économique et de l'épargne intérieure à l'aide de la méthode Dickey-Fuller de racine unitaire augmentée. La deuxième a examiné les relations à long terme entre la croissance économique et les taux de croissance de l'épargne intérieure

No abstract

PurposeThe purpose of this paper is to examine the impact of the size of government and public debt on real economic growth, for a panel of 175 countries around the world.Design/methodology/approachThe paper utilizes the fixed‐effects and random‐effects techniques to estimate the panel regressions.FindingsThe results indicate that both the size of government and the extent of government indebtedness have negative effects on economic growth.Practical implicationsThe findings suggest that the authorities ought to take the necessary steps to curtail excessive government spending and public debts, in order to promote economic growth.Originality/valueThe contribution of the paper is its application of the fixed‐ and random‐effects techniques in modeling the relation of real economic growth to the size of government and public debt, for a panel of 175 countries around the world.

Purpose -The paper attempts to empirically assess whether GDP per capita or the human capital index is a better measure of happiness. Design/methodology/approach -Cross-country regressions are run to see how GDP per capita fairs in comparison to the human capital index in explaining happiness based on survey questionnaires. Findings -The paper finds that GDP per capita accounts for a far greater share of the cross country variation in happiness based on survey data than the human capita index and assorted other measures of human welfare. Practical implications -The important implication is that the often heard criticism that GDP per capita is inappropriate for use in economic analysis, especially in the area of economic development and other international fields, because it is not specifically designed as a measure of welfare, may be unfounded. Originality/value -The paper shows that GDP per capita is a better measure of happiness defined in surveys than the human capital index.