Journal Global Policy and Governance

The Effect of Exchange Rate Volatility on Bilateral Trade between Turkey and European Union Countries: Asymmetric Analysis with Markov Regime Switching Models

Mesut Doğan, Selim Güngör, Samet Gürsoy — Wed, 21 Dec 2022 00:00:00 +0000

This study aims to reveal the asymmetric effect of real exchange rate volatility on bilateral trade between Turkey and 8 European Union member countries under different economic cycles. Accordingly, monthly data from January 2005 to December 2021 were analyzed with Markov regime switching models. The findings show that an increase in real exchange rate volatility reduces bilateral trade between Turkey, Belgium, and Germany during periods of economic expansion, while bilateral trade between Turkey and Poland decreases during periods of economic contraction. In addition, while it was detected that an increase in real exchange rate volatility decreased the bilateral trade between Turkey and Italy, and Romania in both expansion and contraction periods of the economy, no significant finding was obtained regarding the effect on bilateral trade between Turkey and France, the Netherlands and Spain. The findings prove that the Marshall-Lerner condition and J-curve effect are not valid in trade with the relevant EU countries.

The Poverty Implications of Governance in South Africa

Adrino Mazenda — Wed, 21 Dec 2022 00:00:00 +0000

Good governance is critical in the fight against poverty. It entails reshaping politics to benefit the poor. This article utilised the quantitative cross-section design and the principal components regression analysis (PCA) to investigate the relationship between good governance, particularly government effectiveness, and poverty reduction in South Africa, drawing on the Oxford Global Multidimensional Poverty Index and the World Bank Governance Indicators.
The PCA extracted two components; the first component variance represents about 36 per cent of the population who are middle-high income earners. The second component variance comprises approximately 60 percent of the people that earn a low income. The group has been the target of several poverty reduction policies and is the subject of this study. The PCA regression showed that government ineffectiveness, political instability, and corruption are vital factors in the increased poverty levels amongst low-income earners in South Africa.
We recommend that; institutions should offer good governance through accountable and transparent administration of poverty alleviation programmes. Research is needed to programme activities and assistance packages that are feasible and geared to country-specific conditions.

Conduct Global Citizenship Education with Chinese Characteristics: A Case Study of Finland

Qin Su — Wed, 21 Dec 2022 00:00:00 +0000

Globalization not only brings economic interdependence to the international community but also brings exchanges and integration, or confrontation and conflict among diverse values. Especially when developed countries brought significant cultural impact to developing countries, China experienced cultural loss and value dislocation. Misunderstandings in international politics have seriously hindered smooth and fair communication between China and the world. Removing obstacles and promoting communication have become urgent tasks for China in the new era. Reshaping the values system in the global vision of a new era through the development of the educational system is a necessary approach to realize the rejuvenation of the Chinese nation, and a framework of Global Citizenship Education (GCE) with Chinese characteristics accordingly becomes an integral approach to achieve the objective. This article will take the Finnish international education system as an example to learn from experience and discuss how to construct a GCE system with Chinese characteristics from three aspects: institutional support for the government, school operation management, and cooperation for social assistance.

Governance and Health Systems in the MENA Countries: A Panel Causality Framework

Chokri Terzi, Emna Essadik — Wed, 21 Dec 2022 00:00:00 +0000

A substantial body of research has been carried out to analyze the health system’s determinants, considering a wide range of variables related to economic performance, monetary policy, telecommunication, and demographic statistics. Nevertheless, little is known about the impact of governance on the health system. This paper aims to overcome this shortcoming and to investigate the causality nexus of the health system and governance in short and the long run, using a panel data set for 14 MENA countries over the period 1996-2019. The proposed methodology is based on calculating a Governance Composite Index (GCI) by aggregating several indicators related to good governance. Next, we will try to measure the effects on the health system of selected factors. Finally, a causality analysis is made based on the Engle-Granger two-step approach. Empirical analysis shows that good governance contributes significantly to the health system in the long run but not in the short run. Based on a simulation analysis, we measure the additional rate in the annual growth in good governance that is sufficient to make its short-run effect significant.

A Firm-Level Analyses of the Link Between Innovation Investments and Performance

Ermira Kalaj, Albana Kastrati, Brilanda Bushati — Thu, 22 Dec 2022 00:00:00 +0000

Our study focuses on the analyses of investments in innovation of enterprises and their performance impact in Albania. We use data from 2019 Enterprise Surveys (ES) to answer the research question and focus on digitalization patterns that characterize Albanian enterprises. The survey was a shared project of the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), and the World Bank Group (WBG); the data are collected in Albania between January and May 2019. The objective of the ES is to contribute to understanding what firms experience in the private sector. Collected data are based on firms’ experiences and enterprises’ perceptions of the environment in which they operate.
The dependent variable is the performance of the firms measured in terms of sales growth and labor productivity. In contrast, the vector of independent variables is composed of enterprise characteristics such as firm size, ownership structure, legal status, R&D expenses, access to formal banking services, and gender ownership. Moreover, to capture the innovation investment, we will use the following ES questions: (1) During the last three years, has this establishment introduced new or improved products or services? (2) Did this establishment spend on research and development activities?

Microcredit Governance Efficiency

Emiljan Karma, Klodian Muço, Mauro Gianfranco Bisceglia — Thu, 26 Jan 2023 00:00:00 +0000

Albanian microfinance sector, in particular microcredit, has experienced modest development in recent years, although having the objective (moreover shared at the EU level) of the fight against social and financial exclusion, self-employment promotion, and small businesses support. Microcredit represents a lifeline or starting point for small entrepreneurs or start-ups to access credit, which is impossible otherwise. Thus, it provides a start-up or survival opportunity for people and businesses that would not have vital space in different circumstances. An instrument widely used in Western Countries, therefore, to be replicated mainly in developing countries such as Albania to allow more favorable conditions for credit access and consequently more economic and social growth. This paper aims to provide an assessment of the financial and social efficiency of the microfinance sector and, in particular, of Albanian microcredit. This evaluation is carried out using DEA (Data Envelopment Analysis) method through secondary data obtained from financial institutions operating in Albania. The analysis highlights the noticeable financial and social inefficiencies. This study clearly points out the greater attention of microcredit institutions toward financial objectives (and less to social ones).