Does External Debt Cause Economic Growth? An Experience from ECOWAS Member Countries

Musibau, Hammed Oluwaseyi; Mahmood, Suraya; Ismail, Suraya; Shamsuddin, Zelhuda; Rashid, Norfadzilah

doi:10.6007/ijarbss/v8-i11/5167

Cited by 12 publications

(15 citation statements)

References 6 publications

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“…Our major finding, however, disagrees with Govdeli (2019) who employed ARDL bounds technique to examine effect of external debt on economic growth in Turkey for the period 1970-2016, as well as Musibau et al (2018) that studied impact of external debt on economic growth in West African countries from 1980-2015. Also, Anifowose (2016) examined impact of external debt and debt servicing on economic growth of some ECOWAS countries applying time series data covering the period 1970-2008.…”

Section: Discussion Of Resultscontrasting

confidence: 99%

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Impact of Foreign Capital Inflow on Economic Growth in Ecowas Sub-Region

Anidiobu¹,

Okolie²,

Onyia³

et al. 2020

IJARAFMS

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This study assessed the impact of external finance (proxied by external debt) on economic growth (measured by real GPD growth rate) in Economic Community of West African States (ECOWAS) sub-region. Annualized panel data for 32 years were obtained from World Development Indicators (WDI). Ex-post facto design was adopted because our data were secondary in nature. Individual characteristic of the series were ascertained with descriptive statistics. The stationarity of our variables was tested using five test criteria, namely: Levin, Lin & Chu t; Breitung t-stat; Im, Pesaran and Shin W-stat; ADF-Fisher Chi-square, and PP-Fisher Chi-square. The panel series became stationary when differenced at first [(i.e. at order one I(1)], which proved that our panel series did not have unit root. Panel least square (PLS) estimation process was used to analyze our modified models. The model were further analyzed with both fixed and random effect panel regression estimators, using the Hausman test to ascertain the best and appropriate choice between the two. Thus, our analysis was based on the random effect (RE) estimator. A 5% error tolerance level was allowed for this study. The outcomes showed external debt had a negative, but significant effect on real GDP growth rate. The implication was that external debt did not enhance economic growth in the sub-region during the sample period. This outcome was attributed to ineffective fiscal policy implementations and lack of budget discipline. Since external debt is noteworthy debt instrument that can help boost the economies of ECOWAS countries, governments of the sub-region must adopt fiscal adjustment mechanisms that can enhance their revenue profiles through improved taxes rather than borrowing to finance deficit and total reliance on primary commodities (usually unprocessed e.g. crude oil, cocoa) for revenue. The major contribution of this study to knowledge was that it made comparative analysis using outcomes of the sub-regional study and the countryspecific outcomes of the 15 member countries of ECOWAS employing modified panel regression models to analyze the research objective.

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Section: Discussion Of Resultscontrasting

confidence: 99%

“…Finally, gross capital formation was significant in most of the component countries; the effect of trade was mixed. Musibau et al (2018) examined the impact of external debt on economic growth among ECOWAS countries using panel data from 1980 to 2015. The study adopted panel least square to estimate variables.…”

Section: Empirical Reviewmentioning

confidence: 99%

Impact of Foreign Capital Inflow on Economic Growth in Ecowas Sub-Region

Anidiobu¹,

Okolie²,

Onyia³

et al. 2020

IJARAFMS

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“…These are two reasons related to financial resources that cause firms to execute unrelated strategy. Furthermore, firms can exploit market imperfection in developing countries to enhance performance (Musibau et al, 2018). Financial motive could be a reason for implementation of unrelated diversification.…”

Section: Diversification Strategy and Performancementioning

confidence: 99%

Diversification Strategy and Performance in Automotive Firms in Asean Countries

Daud¹,

Rashid²,

Hamzah³

et al. 2018

IJARBSS

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Diversification strategy has been subjected to extensive research among strategic management and finance scholars. This study examines the effect of diversification strategy and performance in public listed automotive manufacturing firms in Asean countries using return on invested capital as a proxy of performance. The study uses panel data analysis for a sample of 28 Aseans' firms during the period 2007 to 2014 based on quarterly reporting data provided by Bloomberg database. The evidence produces interesting findings that related diversification has a significant effect on performance. In the meantime, several other variables show positive impact too. Therefore, automotive manufacturing firms should solely diversify around their core business to maintain their performance. Nevertheless, difference measures of performance should be adopted to check on consistency of the results.

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“…Thus, identifying the elements that influence customer loyalty represents a thorough process which involves a series of customer's perception that stem from the product and service evaluations. It is clearly stated that keeping the customers is crucial for life insurer as a long -lasting association with the customers result in greater instances of cross-selling and positive recommendation intentions (Musibau et al, 2018). The long term relationship between a customer and a firm makes that firm is worth as it helps improved the firm's image, increase the profit margin of the firm as well as improved the quality of services.…”

Section: Literature Reviewmentioning

confidence: 99%

The Mediating Effects of Relationship Commitment-Trust between Innovation and Fairness on Loyalty in family Takaful: A Literature Review

Yazid¹,

Arifin²,

Rashid³

et al. 2018

IJARBSS

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Family Takaful is one of the services sectors that continue to play an important role in supporting economic and social development of Malaysia. It is disclosed that the performance of Takaful industry in Malaysia has strongly contributed by family Takaful business rather than general Takaful business. This can be concluded that family Takaful business remained the major income generator for Takaful industry in Malaysia. It is believed albeit macro-level aspects such as the nation's economy, gross domestic products and so forth may lead to this result; other micro-level aspects at the individual level make contributions as well. Therefore, this study requires further examinations of participant loyalty in family Takaful from an innovation and fairness perspective. In additon, it also explores the mediating effects of relationship commitment-trust to explain the factors influencing participant loyalty in family Takaful. This study employs an extensive search for past literatures on the subject. The findings are expected to make a contribution in terms of understanding the factors that could contribute to the loyalty in family Takaful by Malaysian participants.

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Does External Debt Cause Economic Growth? An Experience from ECOWAS Member Countries

Cited by 12 publications

References 6 publications

Impact of Foreign Capital Inflow on Economic Growth in Ecowas Sub-Region

Impact of Foreign Capital Inflow on Economic Growth in Ecowas Sub-Region

Diversification Strategy and Performance in Automotive Firms in Asean Countries

The Mediating Effects of Relationship Commitment-Trust between Innovation and Fairness on Loyalty in family Takaful: A Literature Review

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