Scholarly Works - Economics

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https://hdl.handle.net/20.500.14576/30

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Browsing Scholarly Works - Economics by Subject "Bound test"

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    Analyzing the market conditions and long-term dynamics in the biodiesel industry
    (Taylor & Francis, 2024-07-02) Muhammad, Mansur; Herbert Wibert Victor Hasudungan
    The Indonesian energy industry is working towards achieving net zero emissions by reducing energy composition between renewables and non-renewables. Based on this background, this study investigates the biodiesel market conditions and its long-term sustainability using monthly data from January 2014 to October 2023. The study applies the 3SLS, Johansen and bound test approach to cointegration for estimations. Findings from the study show that demand for biodiesel in Indonesia is price inelastic, which implies that the response of demand on small price changes is high due to the availability of substitute products. The Walrasian coefficient is negative and statistically significant, suggesting a partial disequilibrium in the biodiesel market. Furthermore, the blending mandatory of biodiesel is found to be sustainable in the long run as shown by the bound f-statistics and Johansens’ trace statistics. The increasing prices of crude palm oil, catalysts, methanol, and glycerin have a devastating effect on biodiesel production. Exchange rate depreciation is also a negative function of biodiesel production. These findings are crucial for industry stakeholders and policymakers to make informed decisions about resource allocation, cost management, and strategies to enhance the sustainability and efficiency of biodiesel production processes.
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    Stock market development in Nigeria : do institutional quality and fdi net inflow matters?
    (ZAIN Publications, 2023-11) Muhammad, Mansur; Muhammad, Sani
    This study examines the effect of institutional quality and FDI net inflow on the stock market development in Nigeria for the period spanning 1996 to 2018. Symmetric method through autoregressive distributed lag model is used for the estimation of the relationship and cointegration. Stock market development is proxy by the annual stock market capitalization, while institutional quality is measured by the average of the composite index covering six categories; control of corruption, government effectiveness, political stability, regulatory quality, rule of law and finally, voice and accountability. Bound test confirms the validity of linear of variables under investigation. We found sufficient and significant evidence, affirming the role of institutional quality on stock market development both in the long run and short run. Similarly, FDI net inflow matters for the development of the stock market in the long run but not significant as expected while in the short it exerts negative and significant impact on the stock market development. This implies that foreign investors in form of portfolio investment will retard the development of the stock market in the short run if not properly managed.