Journal of Economic Impact

A Composite Index for Sustainable Development: Measurement and Development Status of Selected Countries

2022-10-22T18:39:02+00:00

Measuring and comparing development status among countries has long been a difficult task in economic analyses. Development analyses incorporating several aspects of sustainability are one of the most discussed concepts. The present study attempts to assess and measure the development status of various countries by developing a composite index for sustainable development. The measure comprises three sub-indices for economic, social, and environmental dimensions. For this purpose, separate sub-indices for economic, social, and environmental sustainability are designed and constructed to formulate a composite index for sustainable development. The study employs panel data to estimate the state of 140 countries for 1995-2020, taken from the World Bank. The sample includes 46 developed and 94 developing countries. The study utilized standard IMF index-construction methodology. The data is normalized by using the min-max method, and then the principal component analysis is applied for weighting selected variables. Finally, all weighted variables are aggregated to form up concerned indices. Selected countries were ranked based on their score obtained in all three dimensions and for the composite index. The study's findings highlighted high-income countries better in economic sustainability performance with greater environmental degradation. While low-income countries are also the lowest in economic sustainability, having lesser environmental damage. There are mixed results for social sustainability. The study recommends improvements in the economic and social dimensions of sustainability while maintaining environmental standards.

Weather Induced Risks, Mitigation Strategies and Farmers’ Willingness to Participate in Flood Insurance Scheme in Punjab, Pakistan

2023-02-28T18:42:29+00:00

Affordable insurance coverage remains a challenge in many economies demanding public-private support to mitigate disaster risks. The private sector can play an important role in creating public awareness to adopt financial protection against these risks. The lack of insurance penetration is common in developing countries and needs a careful innovative initiative in the agricultural sector specifically. Keeping in view the success of flood insurance schemes globally, it may be a viable option to help rural farmers during recurring catastrophic events in Pakistan. Present research study was conducted to evaluate weather-induced risks, farmers’ mitigation strategies and determining factors affecting the willingness of the farmers to adopt flood insurance schemes. The study used primary data randomly collected through a field survey from 240 farmers of three disaster-hit districts of Punjab during 2018-19. Binary regression was applied to estimate the results. The results of descriptive statistics show that most farmers (80%) consider floods a major weather-induced threat. At the farm level, money savings, diversified agriculture and keeping a high plinth of the house were among the main strategies to mitigate the risks of flood disasters. Factors like education level, off-farm earnings and involvement of farmers in other mitigation programs had a positive and significant contribution to enhancing willingness to participate in a flood insurance scheme. In contrast, higher land size, farmers relying on credit facilities, more contact with agriculture extension staff, and raised houses/plinth of the house were negatively affecting the adoption of flood insurance schemes. The findings can guide the agricultural policymakers and National Disaster Management Authorities towards improving their efforts to mitigate the negative impacts of floods and enhancing the willingness to adopt crop insurance schemes. These findings and measures can promote private insurance companies to propagate their initiatives for public welfare through the launch of insurance schemes more progressively.

Impact of Innovation on Productivity and Efficiency: Evidence from the Textile Industry of Pakistan

2022-12-24T07:52:53+00:00

Being ranked 4^th in the production of cotton, Pakistan's Textile industry makes up one-fourth of industrial output and generates employment for about 40 percent of the industrial labor force. Having 60 percent of total export, textile export has been declining in Pakistan since 2013-14. Therefore, this study explored the impact of innovation on productivity and efficiency in the textile industry in Faisalabad and Lahore, Pakistan. These two districts together contribute 47.8 % of the total textile firms of Punjab, Pakistan. The Stochastic Frontier Analysis has been used on data taken from 193 textile firms by random sampling. The ownership of the firms has key importance in reducing the firms' inefficiency. The lesser the liabilities, the more likely it is for the firm to take the risk, apply new ideas, and adopt innovation. Employing skilled labor in their work facility increases the likelihood of efficiency. The results show a positive relationship between efficiency and all types of innovation. While Research and development expenditure also has a positive effect on productivity as well as efficiency. Workers' training also enhances the productivity of firms, so government should facilitate the firms for workers' training and R&D expenditure.

Opportunities for Pakistan’s Exports Growth through OBOR: Case of Central Asian Republics

2022-12-12T05:13:29+00:00

The economic expansion of these large countries generates a boundless prospect for the Central Asia Republics to emerge as a hub for trade and commerce. Especially with trade road development programs such as Western Europe - Western China (WE-WC) International Transit Corridor Project, One Belt One Road Project (OBOR), this paper analyzes the exports of Pakistan to Central Asian Republics. It explores the flaws and opportunities for bilateral trade. The study uses the Constant Market Share (CMS) method for the analysis and estimates World Trade Effect, Markets Distribution Effect, Commodity Composition Effect, and Competitiveness Effect for Pakistan`s exports. The study found that the World Trade Effect and Markets Distribution Effect positively impacted the exports of Pakistan while the Commodity Composition Effect and Competitiveness Effect were causing problems for Pakistan’s export growth for Central Asian Republics Markets. The study concluded that exports of Pakistan are concentrated in a few commodities, such that 45-50% of Pakistan’s overall exports have a lower global export growth rate than other commodities. Also, the exports to Central Asian Republics (from Pakistan) have a growth rate, but still not substantial due to the low share of these commodities (in the total imports of Central Asian Republics). Lastly, an effective exchange rate policy for the Central Asian Republics can minimize this negative effect of the Competitiveness Effect.

Maintaining Business Ethics during COVID-19 Pandemic in Globalized World: A Comparison of Ethical Theories and Future Research Perspective

2023-02-14T08:18:18+00:00

Business ethics, from the start of the 21^st century, has got attention among business communities. Globalization and workforce diversity have further extended this phenomenon and presently it is considered a part of the organization’s vision and mission statement. However, business ethics are not even practiced properly worldwide, especially in developing countries. Moreover, the present situation of the outbreak of the COVID-19 pandemic has deteriorated the situation. Despite ethical theories, nothing else can justify business ethics, especially employee treatment in this pandemic situation. This paper aims to synthesize, compare and discuss the ethical theories in detail and tries to know whether these theories are enough to properly explain the business ethical issues that emerge due to globalization and the pandemic or not. The paper used the theory synthesis technique. Our discussion revealed that not a single theory can properly explain all the ethical issues and dimensions that emerged due to globalization and the COVID-19 pandemic disruption. Further, this paper suggests different aspects to formulate the new ethical dimensions that could explain all ethical dimensions and issues in all situations. This paper provides practical implications to corporate social responsibility and business ethic specialists to formulate new more precise dimensions in explaining ethical issues.

COVID-19 Attack on Stock Markets: Event Study and Panel Data Analysis of Organization of Islamic Countries (OIC)

2023-05-07T15:10:22+00:00

The outbreak of COVID-19 has hampered the economies in all over the world. Due to this pandemic, many economic activities worldwide continue to be slumps. Current study examines the effect of COVID-19 contagion epidemic on stock markets of 23 OIC economies. Event study approach is employed to quantity abnormal returns (ARs). Fixed effect and random effect models are employed for the cause of abnormal return. Sixty (0 to 59) days, including the event day, are observed in the event window at the release of news related to COVID-19 in media at the international level; each window contains ten days. Pre-event window includes 120 days afore from the event day. We examine the ARs significantly negative in 4 ensuing windows in 59 days. Negative AR is significant for developed as well as developing economies. Findings reveal that the cumulative ARs from day first to day 33 remain in the range of decimal -0.203 to single digit -9.09. Still, from day 34 to day 59, it remains in the range of double digit -10.150 to -19.727, which is the consequence of increased distress in the stock market caused it requires the serious attention of the states to control this pandemic. Further, panel data analysis suggests that more time is required to return to the normal situation of stock markets from the adverse effect of COVID-19. Current investigation is significant for decision bodies for example national banks, stock market officials and state agencies to boost confidence among investors because this pandemic hampered social-economic activities all over the world, including the OIC economies.