Economies

17 pages, 863 KiB

Open AccessArticle

Selected Socio-Economic Aspects of the Last Two Economic Crises in Slovenia Assessed through a Three-Stage Territorial Model

by Simon Kušar

Economies 2024, 12(7), 189; https://doi.org/10.3390/economies12070189 - 20 Jul 2024

Viewed by 1119

Abstract

The aim of this paper is to provide a systematic insight into the socio-economic aspects of the last two economic crises in Slovenia: the Economic crisis between 2009 and 2013, and the COVID-19 crisis in 2020. A three-stage territorial model was developed as [...] Read more.

The aim of this paper is to provide a systematic insight into the socio-economic aspects of the last two economic crises in Slovenia: the Economic crisis between 2009 and 2013, and the COVID-19 crisis in 2020. A three-stage territorial model was developed as a theoretical tool for this study. The data for the analyses came from various statistical sources and from the available literature. The socio-economic aspects of both economic crises were analysed in 11 categories and at three territorial levels: macro (national), meso (regional) and micro (locational). Both economic crises differ fundamentally in many aspects. Compared to the Economic crisis, the COVID-19 crisis was much shorter and less severe, and had relatively little impact on the socio-economic structure of Slovenia and its regions. Both economic crises had some common features: reduction of interregional disparities and different development paths of regions during the crisis, as well as strong economic growth in the first year of recovery. The proposed model can be extended by additional territorial levels and by adding additional social and political-geographical aspects. Full article

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18 pages, 1870 KiB

Open AccessArticle

Modeling of Complex State Financial Support for Small and Medium-Sized Enterprises

by Kristina Alekseyevna Zakharova, Danil Anatolyevich Muravyev and Egine Araratovna Karagulian

Economies 2024, 12(7), 188; https://doi.org/10.3390/economies12070188 - 18 Jul 2024

Viewed by 1015

Abstract

This article describes a new approach to determining the optimal amount of state financial support provided to business entities. It is shown that there are three available methods to support economic agents. The most cost-effective option is subsidizing business entities to expand their [...] Read more.

This article describes a new approach to determining the optimal amount of state financial support provided to business entities. It is shown that there are three available methods to support economic agents. The most cost-effective option is subsidizing business entities to expand their current assets. It has been revealed that there are not just optimal amounts of government financial support but also optimal not-to-exceed amounts that make it possible to identify the boundaries of the so-called highly productive state of the economy. In this case, when the economy is highly productive, the prices of goods (services) fall, workers spend their savings, and the volume of production increases. This ultimately leads to an increase in the well-being of the population. The differential equations are the basis for the model, which is similar to the model of a simple two-sector single-product economy. The Monte Carlo method is used to determine the optimal not-to-exceed amount for government financial support. The identification of such intervals allows us to determine the amount of state financial support that will lead to a highly productive state and will not contribute to an unreasonable expansion of the budget expenditure. This study’s results can be utilized by government authorities for the development of a comprehensive system of state financial support for entrepreneurship. Business entities can use the results of this research concerning the calculation of the optimal not-to-exceed amount of financial support. Full article

(This article belongs to the Special Issue The Relationship between Macroeconomics and Small and Medium Enterprises)

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21 pages, 1245 KiB

Open AccessArticle

The Role of Comparative Advantage in Enhancing Trade in Value-Added Using a Dynamic GMM Model

by Josephine Wuri

Economies 2024, 12(7), 187; https://doi.org/10.3390/economies12070187 - 18 Jul 2024

Viewed by 1700

Abstract

Currently, international trade has evolved into international production fragmentation captured in GVCs. Countries must enhance intermediate exports in comparative advantage sectors to increase their trade in value-added (TVA) in global production chains. However, traditional measurements of revealed comparative advantage (RCA) based on gross [...] Read more.

Currently, international trade has evolved into international production fragmentation captured in GVCs. Countries must enhance intermediate exports in comparative advantage sectors to increase their trade in value-added (TVA) in global production chains. However, traditional measurements of revealed comparative advantage (RCA) based on gross exports need to be updated due to overvaluation, double counting, and implicit distortions in international trade. This study uses a new comparative advantage measure, “new revealed symmetric comparative advantage” (NRSCA). Using a dynamic General Method of Moment (GMM) approach, we investigate the role of comparative advantage in driving TVA regarding backward and forward linkages and examine the impact of the COVID-19 pandemic. We use data from the current Asian Development Bank multi-regional input–output database for 2010–2020. Our findings reveal that comparative advantage significantly impacted international TVA, along with the support of quality institutional services in each country. Implementing a new comparative advantage measure, NRSCA, provided accurate estimation results to overcome the overvaluation problem. Moreover, the COVID-19 pandemic disrupted value-added trade. Full article

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25 pages, 2281 KiB

Open AccessArticle

Resident Evaluation of Reconstruction Challenges and Lessons Learned from the Great East Japan Earthquake: Recommendations for Reconstruction and Industrial Policies 12 Years after the Disaster

by Tetsuya Nakamura, Steven Lloyd and Satoru Masuda

Economies 2024, 12(7), 186; https://doi.org/10.3390/economies12070186 - 17 Jul 2024

Viewed by 1248

Abstract

The year 2023 marks the 12th anniversary of the Great East Japan Earthquake (GEJE). Immediately after the disaster, the number of evacuees reached approximately 470,000, but by November 2022, the number had decreased to approximately 31,000. The reconstruction of housing, disposal of debris, [...] Read more.

The year 2023 marks the 12th anniversary of the Great East Japan Earthquake (GEJE). Immediately after the disaster, the number of evacuees reached approximately 470,000, but by November 2022, the number had decreased to approximately 31,000. The reconstruction of housing, disposal of debris, public infrastructure development, and overall restoration and reconstruction has progressed steadily. However, a re-examination of the status of industrial restoration and reconstruction reveals that restoration and reconstruction have not progressed in some areas. This research statistically analyzes how the Japanese public perceives the issues around the recovery process and what memories and records they would like to learn from regarding the GEJE. The purpose of this study is to ask about reconstruction issues and lessons learned from the GEJE by conducting a web-based survey with 2000 respondents in Japan. The method of estimation is the use of ordinal logistic regression analysis to statistically estimate whether there are differences in recovery issues and lessons learned depending on individual attributes. The results suggest that those who are interested in, remember, and express anxiety about the recovery issues and lessons learned tend to be men, do not have children, are highly educated, and have a higher income. In sum, many of Japan’s citizens are highly interested in the reconstruction of agriculture, forestry, fisheries, housing, urban development, living environment, industry, and livelihood in the affected areas. In the future, they will play a central role in modernizing, scaling up, and integrating the agriculture, forestry, and fisheries industries, as well as in rebuilding towns and livelihoods. In the affected areas, it will be necessary to draw on the lessons learned from the GEJE and create reconstruction plans for the future, and then, policymakers will need to formulate reconstruction policies that reflect the concerns of the Japanese people. Full article

(This article belongs to the Special Issue Industrial Clusters, Agglomeration and Economic Development)

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22 pages, 1127 KiB

Open AccessArticle

Problems and Prospects for the Development of Cluster Structuring in the Economy of Kazakhstan’s Agricultural Sector: Theory and Practice

by Anastassiya Tkacheva, Saniya Saginova, Madina Karimbergenova, Timur Taipov and Gulnar Saparova

Economies 2024, 12(7), 185; https://doi.org/10.3390/economies12070185 - 17 Jul 2024

Cited by 2 | Viewed by 1138

Abstract

This article discusses the issues of cluster policy formation in the Republic of Kazakhstan on the basis of studying the experience of leading countries. The research aim is to find new effective tools and institutions for the development of the cluster structuring of [...] Read more.

This article discusses the issues of cluster policy formation in the Republic of Kazakhstan on the basis of studying the experience of leading countries. The research aim is to find new effective tools and institutions for the development of the cluster structuring of the agro-industrial complex economy of Kazakhstan. Cluster policy in the field of supporting regional clusters starts with the identification of already existing clusters in the region, because by viewing the regional economy through the prism of various local industries and innovative enterprises, regional authorities can identify measures of effective impact and support for their clusters. This research examines the possibilities of using clusters and cluster policy as one of the most important components of the policy for the development and support of small and medium-sized enterprises in Kazakhstan’s agro-industrial complex. The research methodology includes qualitative and quantitative data analysis methods, comparative analysis, and mathematical processing (the Pearson correlation coefficient), as well as the modeling of possible development scenarios. The obtained results show that there are significant opportunities for a wider involvement of small and medium-sized enterprises in the formation of cluster structures of the agro-industrial sector through joint efforts by the government and regional centers in the conditions of innovative development of the country’s economy. Full article

(This article belongs to the Section Growth, and Natural Resources (Environment + Agriculture))

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21 pages, 2862 KiB

Open AccessArticle

Survival Analysis of Small Business during COVID-19 Pandemic, a Brazilian Case Study

by Jorge Luis Tonetto, Josep Miquel Pique, Adelar Fochezatto and Carina Rapetti

Economies 2024, 12(7), 184; https://doi.org/10.3390/economies12070184 - 11 Jul 2024

Cited by 2 | Viewed by 1791

Abstract

The impact of COVID-19 on the economy was devastating. Small businesses typically have few resources to fight against such adversity. Many businesses remained closed for some time during the pandemic period, resulting in significant consequences for people in terms of jobs, income and [...] Read more.

The impact of COVID-19 on the economy was devastating. Small businesses typically have few resources to fight against such adversity. Many businesses remained closed for some time during the pandemic period, resulting in significant consequences for people in terms of jobs, income and life. The objective of this research is to identify the factors that contributed to increasing company failures during the pandemic. Furthermore, this study aims to verify whether the size of the companies, the sectors of economic activity in which they operate and their geographic location influence enterprise failure. This article analyzes the survival of 8931 small businesses from 2017 to 2023, in Rio Grande do Sul, Brazil. The study applied a survival analysis using the Kaplan–Meier procedure, complemented with the Cox procedure, to determine the effects of the size of companies, sector activity and location on the survival time. The results indicate that survival is much higher in small companies with large revenues that are located in the Campaign and West Frontier regions, as well as in the Northeast, North, Production, South, Taquari, and Rio Pardo Valleys regions, whereas the survival rates were extremely lower in the commercial sector and in financial intermediation activities. In the second analysis restricted to the commerce sector, the data highlighted the retail activities, accommodation and food activities sectors as the most affected in terms of overall survival. The results indicated that the survival of small business remained relatively strong during the COVID-19 pandemic, signaling the pertinent support from the government. The smallest business with revenues under USD 15,576 (BRL 81,000) per year were the most affected, with only 39% survival after 7 years. Some activities and some regions suffered more than others, emphasizing the need for special attention from authorities in future catastrophes. Full article

(This article belongs to the Special Issue Economics after the COVID-19)

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22 pages, 2265 KiB

Open AccessCase Report

Exploring the Impact of Political Patronage Networks on Financial Stability: Lebanon’s 2019 Economic Crisis

by Samar Abou Ltaif and Simona Mihai-Yiannaki

Economies 2024, 12(7), 183; https://doi.org/10.3390/economies12070183 - 11 Jul 2024

Cited by 1 | Viewed by 1248

Abstract

Amid Lebanon’s multifaceted economic crisis, this paper explores the intricate dynamics between political patronage networks and financial stability. Grounded in the theoretical frameworks of New Institutional Economics (NIE) and Project Management (PM), the study delves into how entrenched political elites and patronage networks [...] Read more.

Amid Lebanon’s multifaceted economic crisis, this paper explores the intricate dynamics between political patronage networks and financial stability. Grounded in the theoretical frameworks of New Institutional Economics (NIE) and Project Management (PM), the study delves into how entrenched political elites and patronage networks have shaped Lebanon’s financial system, exacerbating vulnerabilities and perpetuating the ongoing crisis. Utilizing qualitative methods including in-depth interviews, document analysis, and case studies, the research illuminates the pivotal role of political actors and their vested interests in economic policies and financial institutions. The findings reveal systemic governance failures, crony capitalism, and institutional decay as underlying causes of Lebanon’s economic stress. In response, the paper proposes a comprehensive framework for governance reform that integrates insights from NIE and PM, emphasizing structured planning, accountability mechanisms, and institutional strengthening. The purpose of this study is not only to contribute to a nuanced understanding of Lebanon’s challenges but also to offer actionable insights for policymakers, academics, and stakeholders to address the root causes of the crisis and pave the way for sustainable economic recovery and revitalization. Full article

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14 pages, 1725 KiB

Open AccessArticle

Analysis of the Competitiveness, Complementarity, and Trade Combination of Kazakhstan and China in the Oil and Gas Trade

by Binghan Du, Jappar Juman, Aiymzhan Tulegenovna Makulova, Assel Valitkhanovna Khamzayeva and Xuan Zhai

Economies 2024, 12(7), 182; https://doi.org/10.3390/economies12070182 - 10 Jul 2024

Viewed by 1416

Abstract

The oil and gas trade is one of the main ways to promote regional economic development by improving the effectiveness of resource allocation. While regional energy cooperation could lead to growth in the energy trade, blind investment will reduce effective yields. Kazakhstan and [...] Read more.

The oil and gas trade is one of the main ways to promote regional economic development by improving the effectiveness of resource allocation. While regional energy cooperation could lead to growth in the energy trade, blind investment will reduce effective yields. Kazakhstan and China maintain a stable oil and gas trade, but resource exports to China are not growing as expected. The aim of this research is to analyze the competitiveness and complementarity of Kazakhstan and China in the oil and gas trade, as well as the main factors affecting the oil and gas trade between Kazakhstan and China. By creating a linear regression equation to analyze the gravity model of the oil and gas trade between Kazakhstan and China, it was revealed that a 1% growth of the gross domestic product in both countries would lead to a 1.471% increase in the oil and gas trade. However, an increase in oil and gas production in Kazakhstan will not contribute to the expansion of the oil and gas trade with China. Kazakhstan and China could improve their oil and gas trade by strengthening financial cooperation, improving energy efficiency, increasing investment in infrastructure such as oil refineries and pipelines, and developing new oil and gas fields in Kazakhstan. Full article

(This article belongs to the Topic Energy Economics and Sustainable Development)

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39 pages, 488 KiB

Open AccessArticle

Economic and Political Determinants of Sovereign Default and IMF Credit Use: A Robustness Assessment Post 2010

by Lina Maddah, Hassan Sherry and Hussein Zeaiter

Economies 2024, 12(7), 181; https://doi.org/10.3390/economies12070181 - 9 Jul 2024

Viewed by 1086

Abstract

According to the IMF, the current public debt makes up nearly 40 percent of the global debt, marking the highest share since the mid-1960s. Despite the vast research on alarming levels of sovereign default, the literature remains inconclusive. This paper investigates macroeconomic, financial, [...] Read more.

According to the IMF, the current public debt makes up nearly 40 percent of the global debt, marking the highest share since the mid-1960s. Despite the vast research on alarming levels of sovereign default, the literature remains inconclusive. This paper investigates macroeconomic, financial, and political determinants of IMF credit use in the post-2010 era. The main contribution of our study lies in its temporal analysis as we investigate how the robustness of different factors has evolved. By utilizing an extensive dataset on 216 countries over the period of 2010–2021 and employing a variant of the Extreme Bounds Analysis (EBA) method, our study reveals that fluctuations in the IMF credit to external debt ratio can be attributed to changes in the total reserves to external debt ratio, where this relationship is statistically significant and reliable. However, high political risks seem to no longer affect the IMF’s decision, post 2010. Furthermore, our findings demonstrate that excluding countries with low debt arrears strengthens the results’ robustness. These findings contribute to a better understanding of the complexities surrounding IMF credit use in the contemporary global economic scene and offer new standpoints on the Fund’s lending choices. Full article

(This article belongs to the Special Issue The Political Economy of Money)

14 pages, 893 KiB

Open AccessArticle

The Impact of Gastronomic Tourism on the Regional Economy of Thailand: Examined by the Dynamic I-O Model after the Decline of COVID-19

by Banjaponn Thongkaw, Nattapan Kongbuamai, Warattaya Chinnakum and Chukiat Chaiboonsri

Economies 2024, 12(7), 180; https://doi.org/10.3390/economies12070180 - 9 Jul 2024

Viewed by 1305

Abstract

It is reasonable to state that gastronomic tourism is an efficient tool that has the potential to refresh Thailand’s macroeconomic viability. With the aim of becoming a hub of tourism in Southeast Asia, Thailand’s tourism industry must urgently address and sustainably integrate gastronomic [...] Read more.

It is reasonable to state that gastronomic tourism is an efficient tool that has the potential to refresh Thailand’s macroeconomic viability. With the aim of becoming a hub of tourism in Southeast Asia, Thailand’s tourism industry must urgently address and sustainably integrate gastronomic activities to navigate the troubled situation caused by its decline after the COVID-19 pandemic. This has led the authors to conduct a deep study on a regional input–output (I-O) table analysis for Thailand’s tourism system, specifically focusing on gastronomic activities and tourism industries. The tourism I-O data used in this study come from the official source provided by the Thailand Ministry of Tourism and Sport. Empirically, the results of the dynamic regional I-O model predict that Bangkok and its surrounding areas are the heart of gastronomic tourism development, driving income into Thailand’s economy. The eastern region stands as the second-largest area of gastronomy tourism, generating a positive impact on Thailand’s economy. On the other hand, the Northeast of Thailand receives less income from gastronomy tourism despite being the largest area in the country. Ultimately, there should be a greater emphasis on gastronomy tourism policies in order to fully maximize their potential for tourism development, stimulating every part of Thailand during the economic depression caused by COVID-19. Moreover, gastronomy tourism has the potential to play an important role in driving economic growth through the combination of cuisine and tourism development. Full article

(This article belongs to the Special Issue Demographics and Regional Economic Development)

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34 pages, 930 KiB

Open AccessArticle

Granular Cities

by Leon Esquierro and Sergio Da Silva

Economies 2024, 12(7), 179; https://doi.org/10.3390/economies12070179 - 9 Jul 2024

Viewed by 1116

Abstract

This study extends the concept of granularity from firms to cities, examining how large cities influence national economic dynamics beyond their relative size. By applying Zipf’s law, which describes the power law distribution of city sizes, we investigate the interplay between granularity and [...] Read more.

This study extends the concept of granularity from firms to cities, examining how large cities influence national economic dynamics beyond their relative size. By applying Zipf’s law, which describes the power law distribution of city sizes, we investigate the interplay between granularity and business cycles. Our aim is to test the granular hypothesis that large cities have a significant impact on the business cycle beyond their relative size. We analyze data from American and Brazilian cities between 2003 and 2019 assessing the granular residuals and their explanatory power. Our findings reveal that in the United States, the granular city size is three metropolitan areas or five counties when redefined. In Brazil, it equates to three municipalities. These results emphasize the substantial role large cities play in national economic fluctuations, suggesting that policy interventions that target infrastructure, education, and innovation in major urban centers could have widespread economic benefits. This paper’s contribution to the literature is to highlight a spatial component of granularity not considered so far. Full article

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17 pages, 605 KiB

Open AccessArticle

Multi-Criteria Evaluation of the Institutional and Tax Environment for Business in the EU Economies

by Charalampos Kalligosfyris, Zacharias Dermatis, Eleni Kalamara and Athanasios Anastasiou

Economies 2024, 12(7), 178; https://doi.org/10.3390/economies12070178 - 9 Jul 2024

Viewed by 760

Abstract

The purpose of this study is to evaluate the institutional and tax environment for businesses in 21 countries of the European Union (EU), using a multi-criteria analysis and, in particular, the PROMETHEE II method, based on thirteen evaluation criteria and the ranking of [...] Read more.

The purpose of this study is to evaluate the institutional and tax environment for businesses in 21 countries of the European Union (EU), using a multi-criteria analysis and, in particular, the PROMETHEE II method, based on thirteen evaluation criteria and the ranking of the European economies. Through the research, the importance of factors related to the efficiency of the tax administration, the tax capacity of the country, the growth rate of the economy, the quality of institutions, the level of corruption, the tax burden, the time of tax compliance and the political stability of the country is studied, in the formation of an attractive environment for the development of entrepreneurship in the EU economies. Moreover, the results of the analysis revealed the existence of significant fiscal and institutional differences between the EU economies under investigation, regarding the development of entrepreneurship. These differences are due to the size of the economy, the institutions, the history, the economic crises of each country and a wide range of dissimilar policy recommendations, which reflect asymmetric policy responses. The study concludes by offering theoretical and political recommendations to improve the institutional and fiscal environment in EU economies so that entrepreneurship can play an important role in improving the economic and social situation of a country. Full article

(This article belongs to the Section Macroeconomics, Monetary Economics, and Financial Markets)

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18 pages, 3180 KiB

Open AccessArticle

‘Unlock the Complexity’: Understanding the Economic and Political Pathways Underlying the Transition to Climate-Smart Smallholder Forage-Livestock Systems: A Case Study in Rwanda

by Chiara Perelli, Luca Cacchiarelli, Mutimura Mupenzi, Giacomo Branca and Alessandro Sorrentino

Economies 2024, 12(7), 177; https://doi.org/10.3390/economies12070177 - 8 Jul 2024

Viewed by 1012

Abstract

The livestock-dairy sector in Sub-Saharan Africa, particularly in Rwanda, is experiencing rapid growth due to population expansion, urbanisation, and changing food preferences. The unmet local production demands are causing soil and water pollution, competition for biomass, land, and water, but also grassland degradation, [...] Read more.

The livestock-dairy sector in Sub-Saharan Africa, particularly in Rwanda, is experiencing rapid growth due to population expansion, urbanisation, and changing food preferences. The unmet local production demands are causing soil and water pollution, competition for biomass, land, and water, but also grassland degradation, biodiversity loss, and increased GHGs emissions. Rwanda has the lowest productivity in the region, largely due to inadequate and poor-quality livestock feed resources. To increase animal productivity, promoting forage species with higher nutritional value and better adaptation to drought-prone and poor-fertility soils could be beneficial. Using a mixed-methods approach, the study explores Brachiaria forage adoption and profitability and analyses policy objectives and measures to overcome adoption barriers and promote the transition from subsistence to market-oriented systems. Results show that Brachiaria, although advantageous from an economic point of view, is characterised by very low adoption rates. Furthermore, access to extension programmes is limited and often not supported by adequate incentives. To overcome such barriers, policy interventions should be harmonised and information and knowledge management prioritised, public and private extension and advisory services (EASs) programmes coordinated, agricultural input subsidies increased, and institutional coordination promoted to enhance climate-smart animal feeding. Full article

(This article belongs to the Special Issue Economic Indicators Relating to Rural Development)

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30 pages, 2849 KiB

Open AccessArticle

Analysis of Albania’s Trade Direction: Is the Open Balkan a New Center of Gravity?

by Glediana Zeneli (Foto), Arsen Benga and Altin Hoti

Economies 2024, 12(7), 176; https://doi.org/10.3390/economies12070176 - 8 Jul 2024

Viewed by 1022

Abstract

Trade is considered one of the main drivers of a country’s economic growth and development. Therefore, a successful analysis that identifies the bilateral trade flows, their determinants, and the regional integration costs and benefits opens new horizons for international trade perspectives. This study [...] Read more.

Trade is considered one of the main drivers of a country’s economic growth and development. Therefore, a successful analysis that identifies the bilateral trade flows, their determinants, and the regional integration costs and benefits opens new horizons for international trade perspectives. This study examines the effects of new and existing regional agreements on the international trade patterns of Western Balkan countries based on the Albanian case. In this regard, an extended trade gravity model is applied with a panel data set of trade flows between Albania and 43 of its regional strategic partners during the period of 2008 to 2022. This work considers two different similarity indexes to explain the effect of the economic structures of partner countries on their trade volumes: the relative factor endowment and the absolute factor endowment. The first is used to test the Linder Hypothesis, and the latter is used to test the effect of similarity in economic size between trading partners. Empirical results indicate that the effect of the selected explanatory variables, such as transportation costs, economic size, economic strength, exchange rate, and their relative as well as absolute endowment, is within expectations. Unexpectedly, the domestic economic size and strength are found to be insignificant in explaining the import flows and inversely proportional to the exports of Albania. Finally, it is indicated that trade flows are clearly dependent on traditional ties rather than on new incentives like the Open Balkan, which cannot offer a new regional center of gravity. To the best of our knowledge, this is the first time that the gravity of the Open Balkan initiative has been tested for one of the participating countries. The study concludes that while the Open Balkan initiative shows potential, the Berlin Process remains a more reliable path toward EU integration for Albania. Full article

(This article belongs to the Special Issue Foreign Direct Investment and Investment Policy (2nd Edition))

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15 pages, 1463 KiB

Open AccessArticle

Persistent and Long-Term Co-Movements between Gender Equality and Global Prices

by Juan Infante, Marta del Rio and Luis Alberiko Gil-Alana

Economies 2024, 12(7), 175; https://doi.org/10.3390/economies12070175 - 5 Jul 2024

Viewed by 860

Abstract

This paper investigates the relationships of the Bloomberg Gender Equality Index and the MSCI World Index in global financial markets. The main objective is to analyze the degree of integration of each index from a fractional perspective for the years 2014–2021. The methodology [...] Read more.

This paper investigates the relationships of the Bloomberg Gender Equality Index and the MSCI World Index in global financial markets. The main objective is to analyze the degree of integration of each index from a fractional perspective for the years 2014–2021. The methodology involves fractional integration to assess the consistency and integration levels of both indices, revealing that they are remarkably consistent with integration orders close to 1 and no evidence of mean-reverting behavior. When examining potential cointegrating relationships between the two indices using the classical two-step method of Engle and Granger, the order of integration of the estimated errors is very close to 1, showing no evidence of cointegration. However, employing the more robust fractional CVAR (FCVAR) approach, the results strongly support the hypothesis of cointegration, indicating evidence of long-term co-movements between the two indices. The findings suggest that investment strategies should incorporate gender diversity criteria, as companies aligning with these benchmarks may enhance co-movements with the Bloomberg Gender Equality Index. Policymakers should promote transparency and initiatives that support gender diversity to improve market stability. Full article

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20 pages, 1274 KiB

Open AccessArticle

The Determinants of Decent Work in Moroccan Cooperatives and Implications for Public Action: Toward Public Action through Determinants

by Badr El Azhari, Mohammed Bougroum, Lahcen Ait Daoud and Houmam Lotfi

Economies 2024, 12(7), 174; https://doi.org/10.3390/economies12070174 - 5 Jul 2024

Viewed by 772

Abstract

In a context marked by growing inequalities and sustainable development challenges, Moroccan cooperatives represent an opportunity to reconcile economic objectives with social issues. Rooted in principles of solidarity and democratic participation, these entities play a significant role in promoting decent work in alignment [...] Read more.

In a context marked by growing inequalities and sustainable development challenges, Moroccan cooperatives represent an opportunity to reconcile economic objectives with social issues. Rooted in principles of solidarity and democratic participation, these entities play a significant role in promoting decent work in alignment with the Sustainable Development Goals (SDGs). The main objective of this study is to identify and analyze the determinants of decent work within Moroccan cooperatives in order to propose ways of improving working conditions and worker well-being. A survey of 394 Moroccan cooperatives and a data analysis using RCM regressions were used to assess the influence of employees’ socio-professional characteristics, the organizational specificities of cooperatives, and public action on decent work. The results indicate that factors such as youth, employee level of education, the gender of employees and managers, financial performance, and the quality of cooperative governance are decisive factors in the quality of decent work. Public action, in particular government support combining financial and technical measures, is identified to have a positive impact on working conditions. This research highlights the importance for public policy of supporting education and vocational training, promoting gender equality, improving cooperative management, and effectively structuring government support to maximize its positive impact on decent work. These findings offer concrete avenues for policymakers and cooperative managers to improve worker well-being and contribute to the SDGs. By addressing the challenges identified and implementing targeted strategies, it is possible to move toward more inclusive economic growth and decent work for all within the Moroccan context. Full article

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23 pages, 2786 KiB

Open AccessArticle

Constant Value Added Share Analysis: A Novel Trade Decomposition Technique with an Application to the Philippines

by Peter A.G. van Bergeijk and Gina M. Ledda

Economies 2024, 12(7), 173; https://doi.org/10.3390/economies12070173 - 4 Jul 2024

Viewed by 940

Abstract

This article provides a novel approach to the traditional constant market share (CMS) analysis recognizing the importance of global production networks and fragmentation that necessitate using trade in value added (TiVA) rather than gross trade. We discuss how the components of a CMS [...] Read more.

This article provides a novel approach to the traditional constant market share (CMS) analysis recognizing the importance of global production networks and fragmentation that necessitate using trade in value added (TiVA) rather than gross trade. We discuss how the components of a CMS analysis need to be (re)interpreted and apply our Constant Value Added Share (CVAS) analysis to the Philippines in the years 1995–2020 using the latest TiVA 2023 dataset (released in November 2023) and compare CMS to CVAS in order to facilitate understanding the contribution of the novel approach. The CVAS analysis finds that while Philippine and world Value Added grew at par, the country lost competitiveness. Traditional CMS suggests a smaller loss of competitiveness. Our approach also identifies specific sectoral weaknesses (i.e., computer and electronics exports) and emerging strengths (technology-related business services) that are unclear in CMS analysis. We argue that Constant Value Added Share analysis is useful for assessing the global value chain performance of other developing countries as well. Full article

(This article belongs to the Section Economic Development)

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14 pages, 290 KiB

Open AccessArticle

Post-Acquisition Operating Performance of Acquiring Firms following Cross-Border Mergers and Acquisitions

by Aamir Khan and David Kalisz

Economies 2024, 12(7), 172; https://doi.org/10.3390/economies12070172 - 4 Jul 2024

Viewed by 1153

Abstract

This study investigates the firms’ performance following cross-border mergers and acquisitions (M&As) from 2000 to 2022, employing the generalized method of moments (GMM) technique within the French context. Grounded in the theories of organizational learning and the institutional-based view, the empirical findings reveal [...] Read more.

This study investigates the firms’ performance following cross-border mergers and acquisitions (M&As) from 2000 to 2022, employing the generalized method of moments (GMM) technique within the French context. Grounded in the theories of organizational learning and the institutional-based view, the empirical findings reveal that acquiring firms exhibit an improved long-term performance after engaging in cross-border M&A deals. Additionally, acquisition experience and industry relatedness significantly enhance the firms’ performance. Institutional quality and cultural similarity are also found to positively moderate the impact of cross-border M&As on firms’ performance. Full article

(This article belongs to the Special Issue The Economics of Globalization: Theoretical, Empirical and Policy Analyses of the Past, Present and Foreseeable Future of Economic Globalization)

11 pages, 222 KiB

Open AccessArticle

Stock Markets and Stress Test Announcements: Evidence from European Banks

by Christos Floros, Efstathios Karpouzis and Nikolaos Daskalakis

Economies 2024, 12(7), 171; https://doi.org/10.3390/economies12070171 - 4 Jul 2024

Viewed by 1090

Abstract

This paper examines the market reaction to the European bank stress test announcement and results release events. Using event study methodology (calculating abnormal returns on a three-day period around the event dates), we find that the market reacts differently between the announcement event [...] Read more.

This paper examines the market reaction to the European bank stress test announcement and results release events. Using event study methodology (calculating abnormal returns on a three-day period around the event dates), we find that the market reacts differently between the announcement event and the results release event. We also show that the market seems to positively overreact one day before each event, and that this positive reaction is either fully or partially reversed one day after the event. We thus conclude that researchers should consider both events when exploring the market reaction to stress-testing exercises. Full article

(This article belongs to the Special Issue Monetary Policy and Central Banking: Challenges in the Current Environment)

19 pages, 2708 KiB

Open AccessArticle

Connectedness between Sustainable Investment Indexes: The QVAR Approach

by Nini Johana Marín-Rodríguez, Juan David Gonzalez-Ruiz and Sergio Botero

Economies 2024, 12(7), 170; https://doi.org/10.3390/economies12070170 - 2 Jul 2024

Viewed by 1171

Abstract

We studied the relationship between sustainable investment indexes and examine whether this relationship varies in bullish, bearish, and stable financial markets. To understand this issue more deeply, we analyzed the connectedness between three indexes—the Sustainable Impact investments, Paris-aligned stocks, and green bonds indexes—using [...] Read more.

We studied the relationship between sustainable investment indexes and examine whether this relationship varies in bullish, bearish, and stable financial markets. To understand this issue more deeply, we analyzed the connectedness between three indexes—the Sustainable Impact investments, Paris-aligned stocks, and green bonds indexes—using the daily closing prices from 1 June 2017 to 15 April 2024, encompassing 1793 observations. We used a quantile vector autoregressive (QVAR) model to understand the dynamic relationship among the considered indices. The findings indicate that sustainable investments are strongly interconnected in both high and low quantiles, but this connection weakens significantly during periods of market stability. The Sustainable Impact investments and Paris-aligned stocks indexes are net transmitters of impacts to other sustainable alternatives, while the green bonds index is a net receiver. We also observed an increase in interconnectedness across all quantiles during the pandemic, the Russia–Ukraine military conflict, and changes in the European Union and the United States’ monetary policies. Full article

(This article belongs to the Special Issue Globalisation, Environmental Sustainability, and Green Growth)

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17 pages, 349 KiB

Open AccessArticle

Determinants of Income Inequality in South Africa: A Vector Error Correction Model Approach

by Molepa Seabela, Kanayo Ogujiuba and Maria Eggink

Economies 2024, 12(7), 169; https://doi.org/10.3390/economies12070169 - 1 Jul 2024

Cited by 1 | Viewed by 1625

Abstract

The issue of income disparity has long plagued South Africa because of the political environment that existed before the country’s 1994 democratic transition. Based on the widely used Gini index, which gauges global inequality, the nation routinely has some of the highest rates [...] Read more.

The issue of income disparity has long plagued South Africa because of the political environment that existed before the country’s 1994 democratic transition. Based on the widely used Gini index, which gauges global inequality, the nation routinely has some of the highest rates of income disparity in the world. Income inequality in South Africa keeps rising even after a number of frameworks and policies have been put in place, which has a big influence on society. Thus, it is essential to comprehend the causes of income disparity and put suitable policies in place to remedy it. The purpose of this study is to look into the relationship between South Africa’s income disparity and its determinants. Using the Vector Error Correction Model (VECM) approach, this study empirically examines the effects of government spending on social grants, gross savings, population growth, and economic growth on income inequality from 1975 to 2017. Data on the Gini index are sourced from the Standardized World Income Inequality Database (SWIID). Findings reveal a statistically significant negative correlation between government spending on social grants and income inequality. Moreover, income inequality demonstrates a negative relationship with both gross savings and economic growth. However, population growth exhibits a positive correlation with income inequality. This study highlights the significance of implementing a comprehensive strategy to address income inequality in South Africa. This strategy should involve augmenting government expenditure on social grants, cultivating a savings culture within households, and enacting policies that incentivize job creation, particularly in areas with rapid population growth. In addition to making a substantial contribution to the body of evidence already available on income disparity, this study offers insightful information to policymakers working to improve the socioeconomic climate in South Africa. Full article

(This article belongs to the Special Issue Income Distribution, Inequality and Poverty: Evidence, Explanations and Policies)

32 pages, 393 KiB

Open AccessArticle

Crises and Contagion in Equity Portfolios

by Christos Floros, Dimitrios Vortelinos and Ioannis Chatziantoniou

Economies 2024, 12(7), 168; https://doi.org/10.3390/economies12070168 - 1 Jul 2024

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Abstract

We examine the international impact of recent financial crises on contagion dynamics within international equity portfolios. First, we highlight the importance of macroeconomics for portfolio weighting for each region, and then we examine contagion via a structural regime-switching model and a contagion test. [...] Read more.

We examine the international impact of recent financial crises on contagion dynamics within international equity portfolios. First, we highlight the importance of macroeconomics for portfolio weighting for each region, and then we examine contagion via a structural regime-switching model and a contagion test. We also examine sources of contagion using regime variables, crisis events, and macroeconomic variables. In particular, we study the Argentine debt crisis, the US financial crisis, and the EU sovereign debt crisis. The macroeconomic variables include changes in market capitalization, trade integration, GDP growth, inflation rate, and interest rate. We also employ two classifications, one relating to the portfolio weighting scheme and another one that considers implied global and regional betas. The empirical findings reveal the existence of financial contagion for all the crises that we investigate. Both methods produce similar results. Stronger contagion is evident for global rather than regional betas. Europe is the region with the highest level of contagion and the one mostly affected by the crises. As far as macroeconomic variables are concerned, they are very important in two ways. They statistically significantly explain contagion, while they also reveal contagion under various portfolio weighting schemes. Both methods suggest that the Argentinian crisis mainly contributes to contagion. The research implications suggest that asset allocation and portfolio management should consider both the global and the regional aspects of contagion as differences can occur. Full article

(This article belongs to the Special Issue Economic Analysis and Policy before, during and after a Public Debt Crisis, a Pandemic and an Inflationary Outburst)

14 pages, 727 KiB

Open AccessReview

Understanding Economic Integration in Immigrant and Refugee Populations: A Scoping Review of Concepts and Metrics in the United States

by Mitra Naseh, Jihye Lee, Yingying Zeng, Proscovia Nabunya, Valencia Alvarez and Meena Safi

Economies 2024, 12(7), 167; https://doi.org/10.3390/economies12070167 - 30 Jun 2024

Viewed by 4153

Abstract

In an increasingly mobile world, the integration of immigrants and displaced individuals is an important factor in creating cohesive and inclusive societies. Integration has different dimensions; this scoping review examines the conceptualization and measurement of economic integration among immigrants and refugees in the [...] Read more.

In an increasingly mobile world, the integration of immigrants and displaced individuals is an important factor in creating cohesive and inclusive societies. Integration has different dimensions; this scoping review examines the conceptualization and measurement of economic integration among immigrants and refugees in the United States. Quantitative peer-reviewed journal papers measuring or conceptualizing the economic integration of first-generation documented adult immigrants or refugees in the United States, as well as relevant conceptual or theory papers on this topic, were included in the review. The search strategy included an online search of the Web of Science Core Collection, PsycINFO, Applied Social Sciences Index and Abstracts (ASSIA), and EconLit. Additional search strategies included scanning the reference lists of studies identified as relevant in the initial database search. An analysis of 72 studies included in the review using a data extraction table reveals seven key domains of economic integration: income and economic security, employment and occupational categories, assets and use of financial services, neighborhood and housing, health, education, and use of public assistance. Income and economic security emerged as the most common indicators of integration in the reviewed studies. Notably, less than half of the reviewed publications had a multidimensional approach to defining or measuring economic integration, and the majority of studies were focused on immigrants, with a smaller proportion dedicated to refugees. This review emphasizes the need for comprehensive frameworks in assessing economic integration among immigrants and refugees, reflecting the multifaceted nature of their economic integration experiences. Full article

(This article belongs to the Special Issue Economics of Migration)

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25 pages, 566 KiB

Open AccessArticle

Asymmetric Analysis of Causal Relations in the Informality–Globalisation Nexus in Africa

by Segun Thompson Bolarinwa and Munacinga Simatele

Economies 2024, 12(7), 166; https://doi.org/10.3390/economies12070166 - 28 Jun 2024

Cited by 1 | Viewed by 714

Abstract

This study examines the causal relationship between informality and globalisation in 30 African countries. It deviates from traditional research by adopting a bi-directional framework to address reverse causality. By applying the DH causality method in both linear and nonlinear frameworks, this research challenges [...] Read more.

This study examines the causal relationship between informality and globalisation in 30 African countries. It deviates from traditional research by adopting a bi-directional framework to address reverse causality. By applying the DH causality method in both linear and nonlinear frameworks, this research challenges the assumption of a linear relationship and finds that the causal structure is better explained within a nonlinear asymmetric context. This paper provides recommendations based on the identified causal relationships. For countries in which globalisation leads to informality, such as Angola, Congo, Guinea, Gambia, Mozambique, Sierra Leone, Tunisia, Tanzania, Uganda, Zambia, and Zimbabwe, the paper suggests policy measures to integrate the informal sector into the formal economy. These measures include designing programmes to facilitate transition, implementing skill development initiatives, and establishing support mechanisms for entrepreneurship and small businesses. Additionally, this paper advises the development of social safety nets, improved market access, effective monitoring and regulation mechanisms, education on the benefits of globalisation, and international cooperation. For countries experiencing positive shocks from informality to globalisation, this paper recommends targeted support programs for entrepreneurship, initiatives to formalize the sector, the enhancement of market access, and skill development tailored to the needs of the informal sector. These policy recommendations aim to capitalize on the positive shocks in informality by fostering entrepreneurship, formalization, market access, and skill development. In the case of negative shocks in globalisation leading to positive shocks in informality, the paper suggests implementing resilience-building policies for the informal sector during economic downturns, establishing social safety nets, and adopting flexible labour policies. Full article

(This article belongs to the Special Issue Shadow Economy and Tax Evasion)

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24 pages, 1378 KiB

Open AccessArticle

Market Reactions to U.S. Financial Indices: A Comparison of the GFC versus the COVID-19 Pandemic Crisis

by Dante Iván Agatón Lombera, Diego Andrés Cardoso López, Jesús Antonio López Cabrera and José Antonio Nuñez Mora

Economies 2024, 12(7), 165; https://doi.org/10.3390/economies12070165 - 27 Jun 2024

Viewed by 1324

Abstract

This study delves into the impacts of the 2008 global financial crisis (GFC) and the COVID-19 health crisis on U.S. financial indices, exploring the intricate relationship between economic shocks and these indices during downturns. Using Markov switching regression models and control variables, including [...] Read more.

This study delves into the impacts of the 2008 global financial crisis (GFC) and the COVID-19 health crisis on U.S. financial indices, exploring the intricate relationship between economic shocks and these indices during downturns. Using Markov switching regression models and control variables, including GDP, consumer sentiment, industrial production, and the ratio of inventories-to-sale, it quantifies the effects of these crises on the CBOE Volatility Index (VIX), Standard & Poor’s 500 (S&P 500), and the Dow Jones Industrial Average (DJIA) from Q1 2000 to Q2 2023, covering crucial moments of both crises and stable periods (dichotomous variables). Results reveal that the 2008 crisis significantly heightened financial volatility and depreciated the valuation of S&P 500 and DJIA indicators, while the COVID-19 crisis had a diverse impact on market dynamics, particularly negatively affecting specific sectors. This study underscores the importance of consumer confidence and inventory management in mitigating financial volatility and emphasises the need for robust policy measures to address economic shocks, enhance financial stability, and alleviate future crises, especially during endogenous crises such as financial downturns. This research sheds light on the nuanced impact of crises on financial markets and the broader economy, revealing the intricate dynamics shaping market behaviour during turbulent times. Full article

(This article belongs to the Special Issue Financial Market Volatility under Uncertainty)

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19 pages, 3671 KiB

Open AccessArticle

A Self-Adaptive Centrality Measure for Asset Correlation Networks

by Paolo Bartesaghi, Gian Paolo Clemente and Rosanna Grassi

Economies 2024, 12(7), 164; https://doi.org/10.3390/economies12070164 - 27 Jun 2024

Viewed by 1388

Abstract

We propose a new centrality measure based on a self-adaptive epidemic model characterized by an endogenous reinforcement mechanism in the transmission of information between nodes. We provide a strategy to assign to nodes a centrality score that depends, in an eigenvector centrality scheme, [...] Read more.

We propose a new centrality measure based on a self-adaptive epidemic model characterized by an endogenous reinforcement mechanism in the transmission of information between nodes. We provide a strategy to assign to nodes a centrality score that depends, in an eigenvector centrality scheme, on that of all the elements of the network, nodes and edges, connected to it. We parameterize this score as a function of a reinforcement factor, which for the first time implements the intensity of the interaction between the network of nodes and that of the edges. In this proposal, a local centrality measure representing the steady state of a diffusion process incorporates the global information encoded in the whole network. This measure proves effective in identifying the most influential nodes in the propagation of rumors/shocks/behaviors in a social network. In the context of financial networks, it allows us to highlight strategic assets on correlation networks. The dependence on a coupling factor between graph and line graph also enables the different asset responses in terms of ranking, especially on scale-free networks obtained as minimum spanning trees from correlation networks. Full article

(This article belongs to the Special Issue Complex Networks on Macroeconomics and Finance: Models, Methods, Applications)

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28 pages, 2772 KiB

Open AccessArticle

Brake Segment for Agglomeration Policy: Engineers as Human Capital

by Akifumi Kuchiki

Economies 2024, 12(7), 163; https://doi.org/10.3390/economies12070163 - 27 Jun 2024

Viewed by 1022

Abstract

A “segment” is a component of the organization of an agglomeration. The organization of agglomeration is formed by the construction of segments. Manufacturing agglomeration segments can be divided into four main categories: human resources including engineers, physical infrastructure, institutions, and living environment. Each [...] Read more.

A “segment” is a component of the organization of an agglomeration. The organization of agglomeration is formed by the construction of segments. Manufacturing agglomeration segments can be divided into four main categories: human resources including engineers, physical infrastructure, institutions, and living environment. Each segment then has a specific function in the process of building industrial agglomeration. We focus on the process of building segments in agglomeration formation. We define a “brake segment” as a segment that has a “function” to decelerate the speed of the process. The purpose of this paper is to identify the existence of this brake segment in the process of constructing the segments of the manufacturing agglomeration. We obtained the following three results. First, a modified version of the spatial economic model yields that the number of agglomerated firms is inversely related to the wages of skilled workers. Second, a factor analysis of the data on investment environment costs indicates that in the case of the manufacturing industry, the number of agglomerated firms are inversely related to the wages of engineers. Third, the factor analysis of the six countries in the JBIC survey reveals that the segment that poses the investment issue in foreign direct investment in India is engineers as human capital. We conclude that engineers as human capital are a brake segment. The implication is that the sustained development of “engineers” as human capital is essential for the success of manufacturing industry agglomeration. Full article

(This article belongs to the Special Issue Industrial Clusters, Agglomeration and Economic Development)

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32 pages, 2382 KiB

Open AccessArticle

Can Remittance Promote Tourism Income and Inclusive Gender Employment? Function of Migration in the South African Economy

by Sandra Makwembere, Paul Acha-Anyi, Abiola John Asaleye and Rufaro Garidzirai

Economies 2024, 12(7), 162; https://doi.org/10.3390/economies12070162 - 26 Jun 2024

Cited by 1 | Viewed by 1393

Abstract

With globalisation and international trade, remittances and migration significantly influence economic activities, yet their impact on tourism income and gender-specific employment remains under-researched. This study uses autoregressive distributed lags and Granger causality to examine the effects of remittances and migration on tourism income [...] Read more.

With globalisation and international trade, remittances and migration significantly influence economic activities, yet their impact on tourism income and gender-specific employment remains under-researched. This study uses autoregressive distributed lags and Granger causality to examine the effects of remittances and migration on tourism income and employment in South Africa. Three models are established as follows: for aggregate employment, male employment, and female employment, each with equations for tourism income and employment. Key findings from this study indicate that remittances significantly drive tourism income in both the short and long run across all models. Conversely, employment negatively impacts tourism income, hinting at sectoral trade-offs. Migration positively affects tourism income in the short run for male and aggregate models but is insignificant for female employment. Remittances boost male employment in both the short and long run, whereas their impact on female employment is significant only in the long run. Causality analysis shows a bidirectional relationship among employment indicators, with unidirectional causality from remittances to migration and from migration to income. This study recommends policies to support remittance inflows and their productive use in tourism, along with targeted interventions to reduce gender disparities in employment and promote equitable economic opportunities. Full article

(This article belongs to the Special Issue Economics of Migration)

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13 pages, 879 KiB

Open AccessArticle

Debt Puzzle: A Comparative Analysis of Public Debt’s Impact on Production Efficiency across OECD Countries

by Usama R. Al-qalawi and Arqam Al-Rabbaie

Economies 2024, 12(7), 161; https://doi.org/10.3390/economies12070161 - 26 Jun 2024

Viewed by 1391

Abstract

Debt is a fundamental component of modern economic systems. It serves as a source of financing for government, business, and individual projects. Many earlier studies concentrated on the direct relationship between debt and economic performance using different econometric methodologies. This work investigates the [...] Read more.

Debt is a fundamental component of modern economic systems. It serves as a source of financing for government, business, and individual projects. Many earlier studies concentrated on the direct relationship between debt and economic performance using different econometric methodologies. This work investigates the effect of debt on production efficiency, extracted from the estimated production function. Unlike previous econometric approaches, we employ a production stochastic frontier analysis (SFA) on data for 18 OECD countries spanning from Quarter 1, 2015, to Quarter 3, 2021, to capture the short-run effect of debt on the production efficiency and, thus, output growth. The results show that, in the short run, as debt increases by $1 billion, efficiency increases by 0.04%. Additionally, we found that the most indebted countries are the most efficient countries. In our sample, those were the UK and France. Furthermore, the average efficiency for the 18 OECD countries was 70.07. Full article

(This article belongs to the Special Issue Dynamic Macroeconomics: Methods, Models and Analysis)

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16 pages, 353 KiB

Open AccessArticle

Data Envelopment Analysis-Based Approach to Improving of the Budget Allocation System for Decarbonization Targets

by Svetlana V. Ratner, Andrey V. Lychev and Vladimir E. Krivonozhko

Economies 2024, 12(7), 160; https://doi.org/10.3390/economies12070160 - 25 Jun 2024

Viewed by 1192

Abstract

Energy innovation plays an important role in the transition to a zero-carbon economy. Governments in IEA member countries are investing in the R&D, demonstration, and deployment of new energy technologies as part of their energy and climate policies. However, government subsidies for energy [...] Read more.

Energy innovation plays an important role in the transition to a zero-carbon economy. Governments in IEA member countries are investing in the R&D, demonstration, and deployment of new energy technologies as part of their energy and climate policies. However, government subsidies for energy innovation are not always efficient in achieving climate policy goals. This paper proposes a two-stage Data Envelopment Analysis model with shared inputs to determine the optimal allocation of public funds for the energy innovation process. The innovation process is divided into two stages: the R&D stage and the commercialization stage. The inputs to the model (budget expenditures for energy innovations) are distributed between the first and second stages. As intermediate products, we use the number of patents in clean energy and hydrocarbon energy. The outputs of the model are the changes in carbon intensity and energy efficiency. This model can be used to assess the effectiveness of government spending on energy innovation. The results show that some IEA member countries should allocate a large part of the fossil fuel technology budget (more than 70%) to the research and development phase. The proposed model can support decision making at the international level to increase the effectiveness of public policies in achieving decarbonization and energy efficiency goals. Full article

(This article belongs to the Topic Energy Economics and Sustainable Development)

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