Formal-Informal Dichotomy of Work in India
This study tries to comprehend the facets of the increasing informalisation of work in India. It uses a deductive approach to analyse the secondary data and literature on the subject. Informalisation of the workforce is not a unique phenomenon restricted to India. Reforms have expedited the informalisation of work in India, which has a detrimental impact on the nature of newly created jobs. The empirical evidence from the National Sample Survey (2017–2018), Annual Survey of Industries (2016–2017 and 2021–2022), India Human Development Survey rounds (2003–2004 and 2011–2012), and International Labour Organisation (2018) showcases increasing informalisation of work. This has made the situation for workers and working conditions highly precarious with the changing nature of employment.
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Wealth Extraction and the Evolution of a Rentier EconomyThe paper highlights the importance of a fair distribution of wealth among the economic agents of a country so that the benefits of a free-market economy work efficiently and create new wealth that fosters economic welfare are at work and functioning efficiently. Extreme inequality and a dysfunctional banking system deprives the market economy from entrepreneurial skills and innovation. In addition, the risk aversion attitudes of the wealthy lead to an elusive pursuit of return without the risk, but which inevitably, through a dysfunctional banking system, results in the transfer of existing wealth from the many to the very few rather than creating new wealth. The real economy is thereby trapped in a vicious circle which further exaggerates wealth concentration and inequality.
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A Panel Analysis of Inequality and Driving Factors of Economic Growth Across EconomiesThe paper examines the relationship between income inequality and economic growth, using various factors like the Gini index, initial per capita GDP, trade and financial openness, financial deepening, population growth, skill premium, energy use, price level ratio, and adult female mortality from 1990 to 2020. Statistical techniques such as ordinary least squares, fixed effects, and random effects regression were used to estimate these relationships. There is a positive relationship between income inequality and economic growth, indicating that higher levels of inequality tend to boost economic growth. Population growth and adult female mortality are consistently and negatively associated with economic growth.
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The Debt-Openness PuzzleThe ‘debt-openness puzzle’ is investigated in this research by determining the effect of trade liberalisation on rising debt levels and if BRICS nations trade openness and government debt have a different connection than advanced economies. Using panel generalised method of moments (PGMM) regressions, we investigate the causes of debt in the advanced, developing, and BRICS economies. The study provides a robustness check using the pooled mean group (PMG) / panel autoregressive distributive lag (ARDL) approach. The research uncovered three primary results. Firstly, in developed economies, there is an initial positive correlation between openness to trade and debt in the short term, but in the long run, this relationship becomes negative, suggesting a nonlinear connection. Secondly, in the short and long term, the BRICS exhibit a notable trend where trade openness and debt positively correlate. Lastly, panel Granger causality studies indicate a one-way relationship between trade openness and debt. The study infers that countries should approach trade openness cautiously, implement appropriate policies and measures to protect indigenous firms and local jobs, and maintain fiscal health without incurring excessive debt. Such policies should enhance productivity and competitiveness and support innovation to promote long-term sustainable economic growth.
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The Determinants to Finance the Fiscal DeficitBolivia faces a shortage of foreign currency, especially dollars, due to a decline in natural gas exports. This decline leads to reduced foreign exchange income and savings, impacting the productive community’s social economic model and causing macroeconomic imbalance. The research identifies independent variables affected by this shortage, all denominated in dollars: gas exports, international reserves, external debt, trade balance, foreign remittances, and the pension portfolio. These variables are essential for meeting obligations and expenses in the General State Budget, with the fiscal deficit being the dependent variable. The study covers the period from 2006 to 2023, during which the economic model was applied. Polynomial projections of each variable were made to identify cyclical patterns or trends. Multiple regression analysis showed a multiple correlation coefficient of 97%. The trade balance and the pension portfolio had negative and significant coefficients, while the other variables had positive and significant coefficients, except for gas exports.
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Do we Need a Fiscal Crisis in the G7?Sovereigns borrow money like other economic actors – and sometimes they borrow too much. Given the critical role of sovereigns in their national economies, this means the effective management of government debt is crucial. Over the past 20 years, sovereign debt has often increased in response to shocks like the Global Financial Crisis, euro crisis, Brexit and the COVID-19 pandemic. Typically, only sovereigns have the capacity to support economies in times of crisis; but doing so repeatedly can raise fiscal challenges. These challenges are prevalent among G7 members, where only Germany has reduced debt in the past decade. Because reducing debt is not a vote winner, it may take a major fiscal crisis to build popular and political support for debt reduction in the years ahead.
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The Development of Central Bank Digital Currencies (CBDCs) at the Global LevelCentral bank digital currencies (CBDCs) have rapidly emerged as a complement to physical cash. Motivations include maintaining central bank money as a monetary system anchor, addressing digital payment reliance, and promoting financial inclusion. CBDCs aim to improve digital payment arrangements. While only three countries have formally launched CBDCs, 35 others have initiated pilot projects. These pilot projects are expected to lead to formal CBDC launches within the next two to three years. The BIS and IMF actively monitor these developments and provide technical assistance to interested central banks. CBDCs represent a delicate balance between innovation and stability in the evolving financial landscape. Their successful implementation requires careful consideration of economic, technological, and regulatory factors.
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Trade Reforms and Smooth Labour Market Adjustments in India?There is a growing concern among economists that the trade policy reforms resulting from India’s growing participation in various multilateral and bilateral agreements has not benefitted all workers engaged in the manufacturing sector. As per existing literature, reform-led reallocation of workers from contracting to expanding sectors will be relatively less costly, if intra-industry trade prevails. Empirical data indicate a mismatch in the number of workers leaving and joining major trade deficit and surplus sectors, which are involved in intra-industry trade. However, due to lack of data availability, no information could be obtained about the ‘origin’ sectors from which the workers are reallocating themselves. This renders the computation of the exact loss (i.e., adjustment costs of trade) difficult. It is also difficult to draw similar insight on entry pattern of new entrants to the industrial workforce, particularly after launch of the ‘Make-in-India’ Scheme (2014) and ‘Skill India Mission’ (2015).
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Institutional Capital in EU Candidate CountriesIn economic theory, a growing understanding of the crucial connection between institutional capital and economic development. Modern economists stress that institutional capital is key to shaping an economic progress, influencing the policies of organisations like the World Bank and IMF, as North (1994) points out. This is especially important for developing countries. Efficient institutional capital plays a crucial role in the aspirations of candidate countries waiting European Union (EU) membership. These countries must cultivate strong institutions as the foundation of their path toward EU integration, given the strict criteria and expectations set forth by the EU. To conduct a comprehensive and complex analysis of a country’s institutional capital, there are used two separate indexes: the Rule of Law Index and the Economic Freedom Index. These indexes provide clear but complementary insights into various aspects of a nation’s institutional efficiency.
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Legal Determinants That Impact Economic GrowthEconomic growth, as a leading macroeconomic objective, is supposed to be determined by different types of variables and indicators, including legal ones. Therefore, through panel data analysis of the 20 EU countries for 2013-2021 years, this research article came across legal determinants that impact economic growth. Data covered in the examination were from secondary sources, i.e., from two credible international institutions, the World Justice Project and the World Bank. This study, conducted through a quantitative scientific approach, i.e., the robust fixed effects model of regression analysis, found the following six legal determinants that impact economic growth: 1) Effectiveness of keeping crime under control; 2) Effectiveness of enforcement of civil justice; 3) People do not use violence to redress personal grievances; 4) Laws and government data are publicised properly (transparency); 5) Government officials in the judicial branch do not utilise their office for personal gain. 6) Civil justice is accessed and afforded by people. The robust fixed effects model was not a subjective choice, but a decision made through the respective tests of pooled OLS, random effects and fixed effects.
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The Effect of Islamic Finance on the Economic Growth of a Sample of Islamic Countries during the Period 2001–2019This study examines the impact of Islamic finance on the economic growth of early adopters of Islamic banking: in Malaysia, Indonesia, Bahrain, Saudi Arabia, and the UAE, using data from 2001 to 2019. Unit root tests determine the stability and integration order of Islamic finance. The study finds that Islamic banks significantly contribute to economic performance, promoting Islamic economic activities and fostering economic growth. This highlights the significance of Islamic finance in driving economic development, especially in nations with Islamic banking. The research offers valuable empirical evidence to the literature on Islamic finance and its role in economic growth in these countries. Overall, it emphasises the positive practical implications of Islamic finance in enhancing economic growth and development.
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Assessing Economic Data Integrity Amidst Sovereign DefaultThe sovereign default of Sri Lanka in April 2022 has sparked concerns about the accuracy and reliability of official economic data, including GDP, inflation, and unemployment figures. The integration of statistical agencies under government ministries in developing countries like Sri Lanka raises concerns about political influence and data integrity. The inflation data in Sri Lanka, measured by indices such as Colombo Consumer Price Index (CCPI) has been historically low until 1977 but has since risen to double-digit levels, reaching 46% in 2022. However, authors raise doubts about the accuracy of these figures due to factors such as subsidised goods distorting consumer price indices and manipulated exchange rates affecting import costs. Unemployment data in Sri Lanka face challenges due to disguised unemployment and weak measurement methods. Discrepancies between official labour force surveys and data from institutions like the Employees’ Provident Fund indicate a need for more accurate and comprehensive data collection methods to understand the true extent of unemployment in the country. These discrepancies could affect policy decisions, especially regarding monetary policy and economic growth strategies.
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Trade in the ShadowsAccurate, timely and reliable statistics on international trade in goods and services are of considerable academic and policy relevance. A major source of illicit financial flows (IFFs) out of developing countries accrues from the under-invoicing of commodity exports. Researchers have highlighted the critical importance of reliable trade data to estimate the magnitude of IFFs and the related channels and drivers which erode the tax base of resource-rich low-income countries, and hence their capacity to mobilise domestic resources for development. Yet, data flaws and methodological weaknesses represent obstacles to identify the drivers and magnitude of the phenomenon, limiting the ability of developing countries to effectively curb IFFs. Drawing on six-year interdisciplinary research on commodity trade-related IFFs, this article examines the weaknesses of existing trade data repositories, notably, with regard to data aggregation, quality and consistency as well as missing data. We discuss the scope for improved data generation and transparency required to inform evidence-based policy debates and action. This, together with global taxation reform, can greatly contribute to effectively enhancing domestic resource mobilisation in developing countries.
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Characterizing Stagflation into Mild, Moderate and Severe EpisodesThe study proposes a new framework to classify stagflation into mild, moderate, or severe episodes based on the magnitude and duration of high inflation and low-output growth. It uses the CPI and PCE deflators as inflation measures, real GDP as output growth measure, and a time-varying benchmark for growth and inflation to account for the changing nature of the US economy. The article identifies 13 episodes of stagflation from 1947 to Q1-2024, with five mild, four moderate, and four severe cases. The current episode (Q2–2021 to Q1-2024) is severe and the second-longest in history. The findings use Bloomberg’s consensus projections to estimate the end of the current stagflation episode by Q1–2024, and discuss the policy implications and lessons from past episodes.
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The Missing Piece: A Copyright IndexThis paper aims to add to the literature on intellectual property protection by creating an index/database to reflect the strength of copyright and related rights for 109 countries for 2023. The index is primarily based on a range of factors like coverage of the law, membership in copyright conventions and its duration, copyright applications and enforcement mechanisms. The evidence indicates that developed countries and European nations tend to provide better protection to copyright holders.
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Relationship of Internet Activity to Income Inequality and Life SatisfactionPrior research shows that the internet has enhanced information dissemination and facilitated economic development. However, the impact of the internet is not evenly distributed among countries or within countries of the world. While the internet facilitates an increase in economic activity, the economic reward from that activity is not evenly distributed to all segments of a society, which leads to income inequality. If income inequality is perceived as excessive, that may cause the population’s life satisfaction to go downward. Findings indicate a negative relationship between internet usage and income inequality, but a positive relationship between internet usage and life satisfaction. Thus, decreases in income inequality and increases in happiness are both associated with increases in internet usage.
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The Marketing Evaluation of Capital Investment ProjectsThrough this article the author attempts to put together in one logical and coherent sequence the steps to be followed when attempting to evaluate the competitiveness of a capital investment project. Over and above applying the correct cost–benefit analysis methodology and building an integrated and manageable financial model it is imperative to research the marketing aspects of the project and build these findings into the projections.
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GDP Growth in BharatCountries should be mandated to purchase carbon credits for their shortfall in nationally determined contributions to the Paris Agreement. The carbon credit purchase quantity for each country should be scaled by a country’s gross national happiness. Governments should fund this carbon credit purchase through national carbon pricing. Mandating government carbon credit purchases will facilitate far-reaching emissions reductions, carbon removal at scale and combat global inequality.
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