Journal of Economic Impact

Assessing Impact of Billion Tree Tsunami Project on Environment and Livelihood Strategies: A Case Study from District Faisalabad

2021-10-25T13:38:42+00:00

The study aims to analyze the impact of the Billion Tree Tsunami Project on the environment and livelihood of the people. The main focus was to assess the impacts of this project in Faisalabad localities. For this purpose, primary data were collected through face to face survey, and respondents were selected by using the quota sampling technique. A total of 124 respondents were interviewed by using a structured questionnaire and analyzed through SPSS software. The results show that improved water storage capacity (Mean =3.95 and SD=0.927, sustain ecosystem (Mean =3.72 and SD=0.98) were ranked at the top by the respondents in assessing the impact of Billion Tree Tsunami Project (BTTP) on the environment. Moreover, the impact of BTTP was assessed by taking the perception of respondents on different attributes. It was observed that factor of labour opportunities was highly endorsed by the respondents. Every age group had almost the same perception of the impact of the billion trees tsunami project. The majority of the highly qualified people (postgraduation and above) had a more positive opinion about billion tree tsunami project as compared to those respondents who were less educated. The gamma statistic is 0.344 (p = .010) which demonstrate a significant and positive relationship between the selected factors. It is concluded that Billion Tree Tsunami Project imprinted strong footings in Faisalabad district as in the overall country. Further, it was recommended that the BTTP project one of the best step to save the environment from the adverse impact of climate change.

Economic Cost of Education and Behavior of Parents towards Child Labor

2021-11-16T17:25:53+00:00

This research was aimed to check the relationship between the economic cost of education and the behaviour of parents towards child labour. Primary data was used to investigate the impact of the economic cost of education on parents’ behaviour towards child labour. One hundred and fifty selected parents were interviewed through a structured questionnaire. Seventy five parents were selected from the group who did not want to send their children to work, and seventy five parents were selected from the group who wanted to send their children to work for comparative analysis. Binary Logistic Regression model was used for empirical findings. The results showed a strong positive relationship between the economic cost of education and the behaviour of parents towards child labour. So it is concluded that the economic cost of education can be one of the main determinants of favourable behaviour of parents towards child labour. As a policy suggestion, it is recommended that free quality of education should be provided by the public sector to address the chronic issue of child labour.

Threshold Effects of Oil Price and Oil Export on Trade Balance in Africa

2021-12-28T17:33:29+00:00

The impact of various macroeconomics variables on trade deficit has been studied in large OPEC (e.g., United Arab Emirates and Kingdom of Saudi Arabia); however other African countries are still needed to be studied. This study uses the transmission oil price (OP) changes to various economic sectors to examine the threshold effects of OP and oil export on trade balance in African OPEC members (Algeria, Angola, Libya and Nigeria). This study applied Pedroni cointegration test to establish the cointegration relationship among different macroeconomics variables by using three different proxies of OP. The dynamic panel models were used to examine the long-run impact of OP changes and threshold analysis. The study found that increase in OP and oil export positively encouraged import while exchange rate depreciation is significantly discouraged import. The study found that the threshold effect of oil export on the trade balance, when oil export is above a certain threshold, the impact is higher than below threshold. The aforementioned countries have to take into account that there is a threshold level and can increase oil export to improve the trade balance.

The Impact of Natural Disasters and Climate Change on Agriculture: An Empirical Analysis

2022-01-29T17:14:05+00:00

This study shows the effect of natural disasters, rainfall, temperature, economic growth, renewable energy, and contributing family workers on the agricultural development index in 101 countries of all income groups (i.e., 24 high, 29 upper-middle, 32 lower-middle, and 16 low). It develops a new agricultural development index using a standard procedure. The two-step generalized method of moments depicts revealed the adverse consequences of natural disasters on agriculture. Renewable energy showed a favorable impact on agricultural development in all panels. Contrarily, the reduction in agricultural development was reported due to an increase in temperature in all panels. Agricultural development increased due to economic growth in all panels. It is required to increase disaster resilience to minimize disaster-related losses. It is recommended to increase renewable energy use for agricultural development. Policymakers should make strategies to mitigate the adverse impacts of global warming.

The Role of Islamic Microfinance in Poverty Alleviation: Evidence from Pakistan

2021-11-08T18:01:03+00:00

This study aims to develop and propose an Islamic microfinance model that can be used for poverty alleviation in Pakistan. Other than investigating poverty, other interrelated aspects were also considered in which entrepreneurship, conventional microfinance, and Islamic finance were included. Moreover, by moving beyond and further exploring, this research presents various uses of Islamic microfinance to reduce poverty. A set of primary data was collected through interviews to carry out this research. Initial findings of the study unveil that poverty exists concerning common perceptions such as lack of necessities, unemployment, poor health, and insufficient financial resources. However, child selling, unethical ways of earning such as begging, robbery, and incompetency of the skilled person were the findings representing poverty from totally different perspectives. Moreover, the studied results also reveal that few respondents were aware of the concept and use of conventional microfinance. Still, at the same time, all the respondents represented the forbiddance of interest. Findings also represent the unawareness about Islamic microfinance's concepts, practice, and importance. This research is helpful as it presents the idea and the use of Islamic microfinance for the impoverished people of Pakistan and how it can be a beneficial alternative for reducing poverty. Moreover, it also seeks the attention from the financial institutions in the Country that how the beliefs and expectations of poor people are important in reducing their poverty. The significance of this study broadens the scope of the neglected concept of Islamic finance generally and Islamic microfinance particularly.

Assessing Multiplier Effects of Public Expenditures on Economic Growth in Nepal: SVAR Model Analysis

2022-02-23T07:09:13+00:00

Expansionary public expenditure is a popular important fiscal measure in the constraint of budgetary resources to achieve higher economic growth with the expectation of higher multiplier effect on productive sectors in the world. Since the actual multiplier effect contradicts with the expected multiplier effect in this discretionary fiscal practice, the goal of higher economic growth is not well achieved. In this context, the practice of public expenditure is a key concern of scholars to understand whether it is the best one or whether its multiplier effect is higher. In this context, this study is an important attempt. This paper assesses the multiplier effects of public expenditures on economic growth in Nepal, covering time series data sets of public expenditures and economic growth from 1974-75 to 2018-19 by using the structural vector auto-regressive (SVAR) model. As a result of the SVAR model, the multiplier effect of public expenditure, recurrent expenditure, and capital expenditure is positive for economic growth. In the results, the multiplier effect of recurrent expenditure is found to be more promising than capital expenditure for economic growth in the short run, but in the long run, it is lower. Similarly, the multiplier coefficient value of capital expenditure is lower in the short run. This is probably due to leakages in the economy, corruption and improper management of development funds, seasonal expenditure trends, and poor management of development projects. Thus, public expenditure is an important fiscal measure to developing economy like Nepal to create a multiplier effect through aggregate demand on national income and employment. Therefore, the government should improve the efficiency of public expenditure and the ratio of capital expenditure and private investment to improve the higher multiplier variable in the long run. The result of this paper will be a valuable input to the policymaker and the planner of Nepal to improve the efficiency of public expenditure through the implementation of a mid-term expenditure framework.

Halal Meat Exports Enhancement of Pakistan: An Intermediating Role of Global Technical Standards in Quality Function Deployment Model

2022-02-19T12:13:02+00:00

A lean and sustainable food supply chain is one of the major strategies that businesses all around the world have been trying to adopt to provide the customers quality food and to remain competitive in the global market. Many industrialists, researchers, and economists have focused on food quality because of the high importance of this issue in the global meat markets context. This research was conducted to investigate the mediating role of Global Technical Standards (GTS) on Voice of Customers (VOC) and Exports Enhancement (EE). Halal meat industry and exports of Pakistan were the primary focus by using a mixed methodological approach. Initially, the quality function deployment (QFD) model was generated for the identification of exports requirements and competitive Novelty Analysis. Fourteen actors (experts) of Pakistan halal meat industry had participated in the identification of requirements and standards. Likewise, exporters from nine economies, including the United States of America, Brazil, Australia, Netherlands, Poland, Spain, India, Canada, and Pakistan, participated in Competitive Novelty Analysis. Secondly, 250 responses were generated from Pakistan’s halal meat industry on a five-point Likert scale. The findings of this study show a significant relationship between Voice of Customers (VOC) and Global Technical Standards (GTS). It was further highlighted that Global Technical Standards mediate the relationship between issues in exports and Exports Enhancement (EE) strategies.

Assessing the Determinants of Efficiency: An Empirical Evidence from Developing Economy

2021-11-03T18:07:23+00:00

Increasing banks' efficiency may help boost the country's economic activity. This study aims to focus on the Pakistani bank’s technical efficiency over the period 2014 to 2019. The study adopts the non-parametric estimation technique based on the output-oriented CCR model to measure banks' technical efficiency scores. The obtained results revealed that the six banks from 30 that remain technically efficient in the sample period from 2014-2019 were Bank Alfalah Ltd, CITI Bank NA Pakistan, Habib Metropolitan Bank Ltd, Industrial Development Bank, MCB Bank Ltd and Samba Bank Ltd. So, other banks should follow the efficient utilization of resources as these banks are utilizing and set as a benchmark of Technical Efficiency. From the results of GMM, it is concluded that the firm-specific determinants that have a significant negative effect on technical efficiency in the case of Pakistan are leverage. In contrast, profitability and solvency have a significant positive impact on the technical efficiency of banks. However, bank size and liquidity are found to be insignificant. Among the macroeconomic variables, GDP has a significant positive impact, whereas interest rate and regulatory quality have a significant negative effect on the technical efficiency of banks in Pakistan. However, political stability was found to be insignificant. The findings of this study have important policy implications for regulators and managers by focusing on the minimal utilization of input and by maximizing output through better management of resources like fixed assets, labor, operating expenses, deposits, and equity. To maximize the outcomes of the banks that are an investment, net profit, loans, other earning assets, and non-interest income, banks can maximize their technical efficiency. Secondly, the banking efficiency could also be enhanced through firm-specific and macroeconomic variables.

Exchange Rate Fluctuation and Inflation Nexus in Nigeria: The Case of Recent Recession

2022-01-29T17:26:26+00:00

The erratic performance of the Nigerian economy has generated theoretical and empirical debate in the literature. For instance, while some scholars have posited that inflation and currency depreciation positively influence a country’s economy, others believe the contrary. This leads to the interaction of both the exchange and inflation rates to arrive at an innovative conclusion. Hence, this study examines the effects of both indicators and their interactive effect of the country’s performance in the regulation era between 1986 to 2019, using the autoregressive distributed lag estimation technique. The empirical findings reveal that the interaction of inflation and exchange rate has a negative impact on the economy in the short run, but it is positive in the long run. Thus, the monetary authority should proactively control the foreign exchange rate movement to curtail the recent surge in inflation and boost the performance of the country’s economy.

Spatial Analysis of Socioeconomic Inequality of Opportunity in Access to Skilled Birth Attendant in Punjab, Pakistan

2022-01-23T12:33:18+00:00

Maternal mortality is a critical global public health issue, particularly in developing countries like Pakistan. Interventions to improve mothers’ usage of skilled birth attendant (SBA) may reduce maternal mortality. The aim of this work to conduct the spatial analysis of socioeconomic inequality of opportunity in access to SBA in districts of Punjab, Pakistan and explore the circumstance variables that contribute the most to the socioeconomic inequality. The study is conducted by using Punjab's Multiple Indicator Cluster Survey 2017-18 and the data analyzed are taken from women of 15 to 49 years with a live birth in the last 2 years. The Human Opportunity Index is used to measure the coverage rate, inequality, and universal access of opportunity across the districts of Punjab. Further, Shapley Decomposition is utilized to identify the contribution of the circumstance factors to the inequality. It is noted that most of the southern districts of Punjab have poor coverage rates and low universal access to SBA and northern districts have high coverage and universal access for the SBA. There is also higher inequality in southern districts of Punjab. Further, in decomposition analysis, it is found that household wealth status, ANC, birth order, birth interval, household head education, ethnicity, media access and residence were the most significant factors leading to socioeconomic inequality of opportunity across the districts of Punjab. Based on the findings, it is suggested that the government should prioritize equitable resource allocation, particularly in southern Punjab.

Impact of Energy Consumption and Trade on CO2 Emission in Pakistan

2022-02-11T14:50:54+00:00

Trade openness is the foundation of economic growth for developed as well as underdeveloped countries. Many countries are now trying to promote their energy sector because energy is an important factor in the production process. A country can trade with other countries only if the country has a surplus of production of Goods and Services. This is the key factor for the development of a country. This study provides empirical evidence of energy use and trade openness on carbon dioxide emission in Pakistan’s economy by using annual time series data from 1976-to 2019. Augmented Dickey-Fuller and Philips Perron tests are employed to check the stationary of the variables, and the ARDL method is employed to check the long-run relationship of variables. The result explores the effect of energy on the trade openness of Pakistan. Trade is the most significant variable in both the long run and short run. The CO₂ (Carbon Dioxide) becomes the cause of environmental degradation. This study recommends that government must take serious steps regarding trade policies in Pakistan. Government must also take care of the poor farmers and traders through subsidies. With good policy implications, the trade level of a country will increase.

The Contribution of Smallholder Beef Cattle Farming to Household Development in Chipinge Rural District, Zimbabwe

2022-04-12T18:52:25+00:00

Smallholder beef farming is a critical tool for combating rural poverty. Several less developed countries have promoted smallholder beef farming with twin objectives to encourage rural development and sustainable rural livelihoods. This study was conducted in Chipinge South Rural District, Manicaland Province, Zimbabwe, with the aim of examining the extent to which smallholder beef farming contributes to rural household development. An assessment was made to ascertain the level of household development for the sampled respondents before and after the beef farming project intervention. An embedded mixed method approach, which combines qualitative and quantitative approaches, was used in the study. The research made use of key informant interviews, focus group discussions, questionnaires, observations and project reports in the collection of both quantitative and qualitative research data. A multi-stage sampling technique was adopted in the study and out of a total population of 1740 farm households in Chipinge South, a sample of 174 farm units was selected from all the six farmer groups registered and operating under the Chipinge Livestock Development Trust (CLDT). In addition, 30 key informants were conveniently sampled for interviews among members of the project management, extension staff, and farmer committee leaders. The results from the study showed that smallholder beef farming enhanced the economic status of the smallholders which translated into improved household assets, better education, adoption of new technology, capacity building and improved food security, among others. While the beef farming project yielded notable benefits to rural households in Chipinge South, the project’s ability to foster sustainable rural livelihoods in the long run was negatively affected by, among other factors, limited access to key livelihood capitals. The study recommends that the responsible authorities in Chipinge South Rural District urgently address the challenges threatening the sustainability of the project in order to promote long-term investment in the beef farming sector in the study area.

Appropriate Fodder Last Cut Date to Enhance Forage, Seed Production and Benefit Cost Ratio of Alfalfa Crop

2022-02-11T07:13:26+00:00

Alfalfa (Medicago sativa L.) due to its palatable, nutritious and multicut nature achieved most importance in forage crops. In Pakistan, the demand of alfalfa fodder and grain is increasing day by day, present scientific research was conducted to observe the impact of last forage cut date on fresh forage and grain yield with maximum income and benefit cost ratio (BCR) of “Sargodha Lucern, 2002” alfalfa cultivar. The research trial was cultivated at research area of FRI (Fodder Research Institute) Sargodha, Pakistan during 2016-17 and 2017-18. Nine alfalfa last forage cutting dates 1^stMarch, 10^thMarch, 20^thMarch, 30^th March, 10^thApril, 20^thApril, 30^th April, 10^th May and 20^th May were randomized in RCBD (Randomized Complete Block Design) having four replicates. The findings indicated statistically considerable differences in forage, grain production and components of yield with gross income and benefit cost ratio. It is concluded that both fodder and grain yield enhanced upto last forage cut date 20^th April. After that seed yield reduced for each cut and fodder yield enhanced continuously upto last fodder cut date 20^th May. Last cut date (20^th May) for fodder produced statistically higher forage yield (54.5 t ha^-1) and seed tonnage (229.75 kg ha^-1). Lowest forage yield (20.5 t ha^-1) was observed in 1^st March last cut date. Maximum seed tonnage was obtained by 20^th April last cut date with maximum net return (Rs. 452500) and BCR (3.66). As considering yield components, when fodder last cut was taken on 20^th April, alfalfa cultivar Sargodha Lucern, 2002 produced significantly maximum pods per raceme (58.25), 1000 grain weight (2.11 g), number of raceme (285.75 m^-2), seed per pod (3.91) and also average grain tonnage (298.75 kg ha^-1). It was considered that Sargodha Lucern, 2002 produced higher grain yield with higher income return when fodder last cutting was taken on 10^th to 20^th April and also temperature remained between minimum 17^°C to maximum 40^°C with relative humidity below 50%.

Strategies to Deregulate the Downstream Petroleum Sector of Pakistan

2022-02-23T08:59:53+00:00

Oil products play a dynamic role in the overall energy domain because it supports country-wide transport, industries, and households. The oil market in most countries is deregulated and provides free access to every organization or independent player. Some of them have followed this policy from the very beginning, while others have followed the strategy regarding deregulation at a later stage. In Pakistan, there is a usual tug of war between Government authorities and Oil Marketing Companies (OMCs) concerning the decision of setting oil prices. This exploratory study aims to assess the prospects of deregulation of oil prices from the point of view of stockholders from the Oil Marketing Companies (OMCs). Data is gathered through interviews from the professional stakeholders who are working in the supply chain department in the downstream petroleum sector of Pakistan, and a thematic analysis method was used to analyze the data. As per the data obtained from the interviewees, there are both advantages and disadvantages of deregulation of petroleum. Advantages are like low prices of petroleum products, positive impact on the economy, opportunities for new entrants, and creation of new jobs. While the disadvantages are oligopoly created by the mafias, failure of the system, dumping of fuel, and increase in cross border smuggling. While the major barriers to deregulation are the Oil and Gas Regulatory Authority (OGRA) and political forces, and the facilitators for the deregulation are foreign direct investment and high tax collection of the Government. The deregulation must be done immediately to pass on the benefits of reduced and appropriate prices of petroleum products besides their availability in every city of the country. Government should also promote bulk import and storage of petroleum products so that the companies get possible economic ordering benefits of low prices.

Assessing the Income Distributional Effect of Lockdowns in Malaysia

2022-04-03T18:51:51+00:00

This paper examines the distributional effect of lockdown measures on the loss of income. The significance of the study relates to the use of daily data on loss of income and lockdown measures arising from the unprecedented COVID-19 pandemic. A conditional variable of the total loss of income was evaluated using hypothesized variables of international restrictions, domestic movement restrictions, public events closure, restriction on gathering, stay at home restrictions, school closure, and workplace closure. For a robust result, the study applied four variants of regression such as Ordinary Least Squares (OLS), Fully Modified OLS, Dynamic OLS, and Autoregressive Distributed Lag (ARDL) as the empirical methods. The findings revealed that loss of income during the COVID-19 period has a positive and significant relationship with the lockdown measures in Malaysia. This implies that as the government strengthens the international and domestic movement restrictions to reduce the impact of COVID-19, the most vulnerable income groups lose their income. This finding is relevant to policymakers regarding plans to rebuild a resilient economy to withstand future pandemics. Policy strategies to reduce restriction measures and allow for opening up the economy to enable the vulnerable income groups to regain their jobs and hence the lost income was discussed.

Decomposition of Total Factor Productivity of Cash Crops in Pakistan: A Malmquist Data Envelop Analysis

2021-10-21T06:32:52+00:00

This paper examined the total factor productivity of cash crops in Pakistan from 1980 to 2018. It uses Malmquist productivity index by applying data envelop analysis to estimate the changes in the production frontier. The Malmquist productivity index is used to decompose total factor productivity into technical change (TECCH) & technical efficiency change (EFFCH). Technical change (TECHCH) means shifts in the frontier or innovation, while efficiency change means catching up to the frontier. The Empirical results show an increase in the productivity of the cash crop in Pakistan. The objective of the study is the decomposition of the total factor productivity of cash crops in Pakistan. Three cash crops (sugarcane, cotton, and rice) and seven inputs (arable land, irrigated land, use of electricity, use of petroleum product, education, credit facility, and machinery) have been used. The study found a 2.2% increase in total factor productivity of cash crops in Pakistan which was mainly due to technological change, and the efficiency score of cash crops in Pakistan has been decreased relative to previous years, which is 8.40% in the period’s t+1, and compared to 10.44% in the period’s t. The government should invest in research and extension in order to provide better seed varieties, better infrastructure, and ensure credit facilities.

Does Laffer Curve Exist in Tax Structure of Pakistan? A Threshold Regression Analysis

2022-01-09T17:33:22+00:00

Laffer curve is a trade-off between tax cuts and tax revenues. The study implies threshold regression to test the existence of the Laffer curve in Pakistan’s economy using time series data for a period of thirty years (1991-2020). The linear association between tax cuts and tax revenues was assessed using simple ordinary least squares technique. The tax structure of Pakistan mainly constitutes two components, direct and indirect taxes. This study examined nature of the Laffer curve using data on direct tax revenue and corporate tax rate. The study supported the evidence of the Laffer curve with a threshold tax rate of 26%. The existing corporate income tax rate in Pakistan is 29% which lies in prohibitive range of the Laffer curve. As a policy measure, the corporate tax rate is recommended to be reduced at least up to the threshold level in order to bring the maximum number of tax evaders and elites under the tax net to enhance the tax revenues of Pakistan.

Determinants of Livestock Herd Size in Mixed Cropping Zone of Punjab-Pakistan

2022-01-30T12:09:18+00:00

Pakistan is considered as an agricultural country dominated by smallholder farmers. The size of the land, livestock, and labor force have paramount importance for the livelihood of resource-poor farmers. The present study was designed to determine the factors affecting the size of the livestock, i.e., the flock size of large ruminant buffaloes and cows. A cross-sectional data set collected randomly from 150 respondents from three districts of the mixed cropping zone of Central Punjab was used to address the study's objectives. Regression estimates revealed that family labor for attending animals, length of lactation, total healthcare expenditures, small land holding, and the geographic district factors significantly affected the herd size of buffaloes and cows. Based on the findings, the study recommends that the implementation of health care systems is one of the crucial factors in building the herd size, mainly through reducing mortality rates, improving the length of lactation, and other aspects of animal well-being. Similarly, the benefits of government livestock policies should reach the grassroot level to retain and use domestic family labor, not as a norm but to engage in the livestock sector for earning their incomes.

Influence of Advertising Intensity on Real Earnings Management: Evidence from Four Sectors of Pakistan

2021-10-05T14:53:26+00:00

The current study aimed to investigate the link between advertising intensity and real earnings management (REM) in the context of four sectors of Pakistan. Besides advertising intensity, market to book ratio, leverage, and firm size were included as explanatory variables. On the basis of data availability for the time period 2007-2019, 11 firms were selected from the Auto assembler sector, 6 firms from Auto parts, 16 firms from Food and Personal Care (PC), and eight firms from the Pharmaceutical sector. Data of the Auto assembler sector was analyzed by random effects panel data regression, whereas data of other three sectors was analyzed by fixed-effects model. In respect of Food and PC and Pharmaceutical sectors, the results of the present study indicate that the extent of REM increases with advertising intensity. Firms adopt the REM approach in order to show the positive outcome of large advertising expenditures. Additionally, a significant negative link between MBR and REM was noted for all sectors except Auto parts. Moreover, a significant positive link between leverage and REM was observed for all sectors except Food and PC. Also, a significant positive link between firm size and REM was noted for the Auto parts sector only. The present study is the first in Pakistan to investigate the link of advertising intensity with REM. This study has important implications for investors and regulators. Investors should carefully compare the firms of Food and PC and Pharmaceutical sectors with the other firms of respective sectors. Also, regulators shall make necessary modifications in the regulations to preclude firms from manipulating earnings. The focus of this study was on four sectors of Pakistan. Thus, the link between advertising intensity and REM can be tested for other sectors.