Assessing Determinants of Macroeconomic Policy on Real Convergence and Growth: A Comparative Study of the Eurozone and ASEAN
Journal Title: Asian Economic and Financial Review - Year 2012, Vol 2, Issue 2
Abstract
This study mainly examines the role of macroeconomic policy variables associated with Maastricht Convergence Criteria (MC), using various approaches to analyze comparatively differences in growth and convergence in income, productivity, and unemployment between a developed, economically integrated area (Eurozone) and a developing one (ASEAN), a decade before and after the euro was introduced. The most interesting issue is whether macroeconomic policy coordination in the Eurozone has had an influence and improves the region’s economic performance, compared to a region that does not have such a policy. Based on estimations, convergence was found to be conditional rather than unconditional, except with respect to unemployment and productivity in the Eurozone. Imposing macroeconomic policy variables associated with MC on convergence and growth in the Eurozone and ASEAN makes it possible to determine any significant influence. Although results were mixed in different estimations, in all equations, joint variables imply that those variables should not be ignored in promoting convergence and growth in both regions. Generally, the Eurozone has higher real per-capita GDP, productivity, and unemployment, and more stable growth in GDP and productivity, but ASEAN performed better in terms of growth of income and productivity, and in low unemployment levels, as suggested also by difference-in-difference and decomposition analysis.
Authors and Affiliations
ZaenalMutaqin| Hiroshima University. 1-5-1 Kagamiyama, Higashi-Hiroshima 739-8529, Japan) and (Sultan AgengTirtayasa University Serang, Indonesia, Masaru Ichihashi| Hiroshima University. 1-5-1 Kagamiyama, Higashi-Hiroshima 739-8529, Japan
Keywords
Related Articles
- EP ID EP1774
- DOI -
- Views 602
- Downloads 42
Trade Liberalization, Poverty and Inequality Nexus: A Case Study of India
The paper attempted to see the relationship between trade liberalization and poverty andinequality in India. For trade liberalization, volume of trade as ratio of GDP, head countratio for poverty and Gini-coefficient has...
CAPITAL STRUCTURE DECISIONS AND FIRM PERFORMANCE OF VIETNAMESE SOES
This paper examines relationships between capital structure decisions, firm performance, and Vietnamese state-owned enterprises (SOEs). Capital structure decisions are considered by short- and long-term debts respectivel...
The Causal Link between Government Expenditure and Government Revenue in Ghana
The study aimed at determining the causal link between government expenditure and government revenue of Ghana over the period 1960 to 2007. Four hypotheses were tested namely: tax-spend hypothesis, spend-tax hypothesis,...
CORPORATE FAILURE PREDICTION MODELS FOR ADVANCED RESEARCH IN CHINA: IDENTIFYING THE OPTIMAL CUT OFF POINT
The rapid growth of the Chinese economy has resulted in Chinese listed companies entering numerous global supply chains, and thereby contributing to the globalization of economies. Accurately predicting corporate distres...
FINANCE-GROWTH NEXUS IN AFRICA: A PANEL GENERALIZED METHOD OF MOMENTS (GMM) ANALYSIS
The paper uses the dynamic GMM Model to examine the finance-growth nexus with panel data (1981-2010) from 24 African countries. Evidence suggests that there is a positive relationship between finance and economic growth...