Oct '23


The IUP Journal of Applied Economics

ISSN: 0972-6861

A peer reviewed journal indexed on Cabell's Directory, and also distributed by EBSCO and Proquest Database

It is a quarterly journal that analyzes the issues of Micro, Macro, Development and Energy economics. It provides papers on Industrial economics, Public finance, Industry, Agricultural, Rural economics, etc.

Privileged access to Online edition for Subscribers.

Focus Areas
  • Microeconomics
  • Macroeconomics
  • Industrial Economics
  • Public Finance
  • International-Trade-and Business
  • Financial Economics
  • International Finance
  • Energy Economics
  • Environmental Economics
  • Labor Economics
  • Development Economics
  • Agriculture-and-Rural-Economics
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Article   Price (₹) Buy
Nexus Between Inequality, Liquidity and Interest Rate: An Empirical Examination
50
Estimating the Public Debt Threshold Level for Upper-Middle Income Asian Countries
50
Impact of Embedded Location Options on Hedging Effectiveness of Agricultural Commodity Futures: Evidence from Chana Futures in India
50
Exchange Rate Volatility: A Review of Global Experience
50
       
Contents : (Oct'23)

Nexus Between Inequality, Liquidity and Interest Rate: An Empirical Examination
Margaret Rutendo Magwedere and Godfrey Marozva

Reducing inequalities is a priority in the United Nations' Sustainable Development Goals (SDGs), and it is an ongoing socioeconomic issue. Using low and medium-income countries as sample, this study seeks to find out whether liquidity affects income inequality. System generalized method of moments was employed to analyze annual panel data from 2005 to 2021, for 37 African countries. All things equal, there is an inverse relationship between liquidity and income inequality. The findings of the study suggest that lower interest rates increase, rather than reduce, income inequality. The policy implication is that income inequality is not just a distributional phenomenon as it is shaped by other macroeconomic fundamentals.


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Article Price : ? 50

Estimating the Public Debt Threshold Level for Upper-Middle Income Asian Countries
Chandran Gunalan and Ramesh Mohan

This paper analyzes the nonlinear relationship between public debt and economic growth, and also estimates the threshold level for upper-middle income Asian countries for the period 1980 to 2021. The results confirm the nonlinear relationship with public debt threshold of 103.4% for the pooled sample. As for individual samples, the highest threshold recorded is 90.8% for Lebanon and the lowest is 15% for Kazakhstan. The results also reveal that nonlinear relationship can exist in both U-shape and -shape, indicating that beyond a specific threshold level, public debt can support higher GDP growth or drag it down. 'Negative' growth, as noted in the literature, does not necessarily indicate that growth becomes negative, but slower. In addition, debt threshold does not exist by default for all the countries, and therefore, we could not find any threshold for Armenia and Azerbaijan. Another crucial finding is that pooled sample tends to provide higher threshold, compared to individual samples. Hence, it causes a misleading understanding among policymakers.


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Article Price : ? 50

Impact of Embedded Location Options on Hedging Effectiveness of Agricultural Commodity Futures: Evidence from Chana Futures in India
Sanjay Mansabdar and C Hussain Yaganti

The impact of embedded location options on Indian agricultural commodity futures returns has not been investigated systematically, despite the available anecdotal evidence suggestive of significant impact. Any significant impact on futures returns translates directly to an impact on hedging effectiveness of the futures. This paper investigates whether the addition of a return term due to the location option helps in explaining futures returns better relative to cash market and storage returns alone for the Chana contract when using regression analysis. Relative importance analysis is used to assess the relative contributions of regressors, and regression coefficients are tested for significance. It is found that the adjusted coefficient of determination improves significantly on adding location option returns as a regressor, and its regression coefficient is significant for the majority of the contracts studied. Relative importance analysis of the regressors shows that location option, on average, accounts for 28% of the explained variability of excess futures. These results suggest that location option impacts futures prices and returns significantly and is a key reason for the poor hedging effectiveness of Indian agricultural commodity futures. These results guide exchanges, regulators and policymakers to reduce the impact of embedded location options by optimizing contract delivery specifications to make futures contracts more useful to hedgers such as farmer producer organizations.


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Article Price : ? 50

Exchange Rate Volatility: A Review of Global Experience
Gitumoni Rajbongshi and P Srinivasa Suresh

Exchange rate volatility is the most important determinant influencing a country's economic health. A rise in exchange rate risk increases transaction costs and reduces the gains accruing from international trade. The economy of a country is closely dependent on its foreign exchange system. This paper reviews various research studies conducted in recent years on factors responsible for exchange rate volatility and its impact on exports, international trade, trade volumes, FDI, etc. The review reveals that government expenditure, changes in supply of money, domestic and external debts, trade, openness, interest rates, domestic and foreign money supply, inflation, changes in terms of trade, bank intervention, productivity, etc. are some of the factors that make exchange rate volatile. Studies pertaining to relationship between exchange rate volatility and trade present ambiguous views. The review reveals that earlier studies found an insignificant and negative relationship, while recent literature showed a positive relationship between exchange rate volatility and trade, due to advancement in the estimation techniques adopted, like autoregressive distributive lag (ARDL) model, error correction models, etc. The review concludes that there is no unanimity in results, as the magnitude of the effect depends on a number of factors and varies from country to country.


© 2023 IUP. All Rights Reserved.

Article Price : ? 50