Journal of Perspectives on Financing and Regional Development
Total Page:16
File Type:pdf, Size:1020Kb
Vol. 6 No. 2, September – October 2018 ISSN: 2338-4603 (print) International peer - reviewed journal 2355-8520 (online) (Journal of Perspectives on Financing and Regional Development) Master Program in Economics Universitas Jambi Accreditation Decree (SINTA S4), valid from 9 Juli 2018 – 8 Juli 2023 based on the Decree of the Director General of Development and Jurnal Research Enhancement, Ministry of Research, Technology & Higher Education of the Republic of Indonesia, Number 21/E/KTP/2018 Perspektif Pembiayaan dan Published by Master Program in Economics, Graduate Program of Pembangunan Daerah Jambi University Editor Adress: Jurnal Perspektif Pembiayaan dan Pembangunan Daerah. Program Magister Ekonomi, Pascasarjana, Universitas Jambi, Kampus Telanaipura Jambi, Indonesia Editor in Chief : Dr. Junaidi, SE, M.Si Universitas Jambi, Indonesia Editorial Board Members : Prof. Dr. Syamsurijal Tan Universitas Jambi, Indonesia Prof. Dr. Amri Amir Universitas Jambi, Indonesia Prof. Dr. Firwan Tan Universitas Andalas, Indonesia Dr. Manta P. Elena Otilia Athenaeum University Bucharest, Romania Dr. Syaparuddin Universitas Jambi, Indonesia Farhan Ahmed, Ph.D Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology, Karachi, Pakistan Dr. Syahmardi Yacob Universitas Jambi, Indonesia Dr. Tona Aurora Lubis Universitas Jambi, Indonesia Dr. Rafal Balina Warsaw University of Life Sciences, Poland Dr. Mahyuddin Hasanudin University, Indonesia Dr. Heriberta Universitas Jambi, Indonesia Peer Reviewers : Prof. Dr. Haryadi, SE, M.Ms Universitas Jambi, Indonesia Mohd Azlan Shah Zaidi, Ph.D Universiti Kebangsaan Malaysia Dr. Joko Tri Haryanto Ministry of Finance, Indonesia Ishaq HACINI, Ph.D University of Mascara, Algeria Prof. Dr. Sofyardi, SE, MA Universitas Andalas, Indonesia Kei Mizuno Kyoto University, Japan Budi Kurniawan, SST, SE, M.Si, ME Central Bureau of Statistics, Jambi, Indonesia Kamila Radlinska, Ph.D Koszalin University of Technology, Poland Dr. M. Syurya Hidayat Universitas Jambi, Indonesia Sambas Ade Kesuma, Ph.D University of Sumatera Utara, Indonesia Yugang He Chonbuk National University, Republic of Korea Dr. Khadra DAHOU University of Mascara, Algeria Muhammad Farooq Jan, Ph.D IQRA National University, Pakistan Ikawati Karim, S.TP, M.Si Universitas Sulawesi Barat Administration Officer : Benni Asmara, S.Kom Distribution : Reza Umiyati Jurnal Perspektif Pembiayaan dan Pembangunan Daerah (The Journal of Perspectives on Financing and Regional Development) is reffered to be a forum for the delivery of scientific thought and analysis in the field of economics especially related to financing and regional development for faculty staff, researchers, alumni, students and broad community. Starting from Volume 6 No. 1, this journal is published into six times a year (originally published four times a year). The editor receives articles that have unpublished yet in any media, either inside or outside the country. The online version of this journal is available at http://online-journal.unja.ac.id/index.php/JES Jurnal Perspektif Pembiayaan dan Pembangunan Daerah Vol. 6. No.2, September – October 2018 ISSN: 2338-4603 (print); 2355-8520 (online) Jurnal Perspektif Pembiayaan dan Pembangunan Daerah (Journal of Perspectives of Financing and Regional Development) Table of Contents Table of Contents i Editor’s Note ii Dynamic links between economic growth, institutions, fiscal policy and stock 155 market development Ghulam Rasool Madni Sustainability of post-mining land use and ecotourism 167 Herdis Herdiansyah; Marikha Ulfah Utami; Joko Tri Haryanto Banking globalization: from origin to development and internationalization 181 Rajeev Rana How to improve accountability of fixed assets of local government? 195 Sri Rahayu; Yudi; Rahayu Fiscal Policy and Economic Stability: A Case of Pakistan 205 Farhan Ahmed; Suman Talreja; Yasir Aman; Govinda Lohana Development and supply strategy of cocoa commodity effect to cocoa farmers’ 223 revenue in Boalemo District Abdurrahman Pakaya; Amir Halid; Hermanto Payuyu Partnership model for small industry in cluster perspective in encouraging 235 regional development (case study on some small industries in Jambi City) Erfit; Yulmardi Approaches to building indices for the program-oriented development of 243 settlements in the Ukrainian context Maksym Filiak; Juliia Filiak Impact of small business management on optimizing business performance 255 (Study on small-scale cake businesses in Sarolangun District) Candra Mustika; Sigit Indrawijaya; Zamzami Methodological aspects of universities’ R&D comercialization in Ukraine in the 265 context of the Quаdruplе Hеlіx Model Nataliya Kholiavko; Tetyana Shestakovska The influence of support program in the development of thermal irrigation canal 277 on rice production improvement in Pohuwato District Amir Halid; Muh. Amir Archam; Sri Astuti Manoppo i Jurnal Perspektif Pembiayaan dan Pembangunan Daerah Vol. 6. No.2, September – October 2018 ISSN: 2338-4603 (print); 2355-8520 (online) Editor’s Note On its sixth year (Volume. 6, Number. 1), the Journal of Perspectives on Financing and Regional Development has two fundamental changes. First, this journal was originally published four times a year, and now has been published six times a year. This is based on consideration of the increasing interest of researchers / authors to publish their articles on this journal. Second, the journal has been nationally accredited with SINTA (Science and Technology Index) score of S4 which is valid from 9 July 2018 – 8 July 2023 based on the Decree of the Director General of Development and Research Enhancement, Ministry of Research, Technology & Higher Education of the Republic of Indonesia, Number 21/E/KTP/2018 concerning the Ranking of Scientific Journal. In Vol. 6 number 2, 2018 is presented eleven articles that come from Universitas Jambi (Indonesia), Universitas Indonesia, Universitas Negeri Gorontalo (Indonesia), University of Lahore (Pakistan), Chernihiv National University of Technology (Ukraine), Lviv University of Business and Law (Ukraine), Lviv National University of Veterinarian Medicine and Biotechnologies (Ukraine), APB P.G. College, Augustmuni, Rudraparyag, Uttarakhand (India), NED University of Engineering & Technology (Karachi-Pakistan), SZABIST (Karachi-Pakistan), Habib Bank Limited (Karachi- Pakistan), Bank Al Habib Limited (Karachi-Pakistan) Hopefully in the next issue can be presented articles with issues and from more diverse circles. Happy joy reading Editorial ii Jurnal Perspektif Pembiayaan dan Pembangunan Daerah Vol. 6. No.2, September – October 2018 ISSN: 2338-4603 (print); 2355-8520 (online) Dynamic links between economic growth, institutions, fiscal policy and stock market development Ghulam Rasool Madni The University of Lahore, Pakistan Correspondence author email: [email protected] Abstract Economic growth is a most crucial factor that plays its role to improve the living standards in a country. But there is no consensus about the variables explaining the economic growth of economies. This paper is an attempt to explore the impact of institutional quality, instruments of fiscal policy, and stock market development on economic growth for a small developing economy, Pakistan over the time span of 1984- 2016. To determine the long and short run relationship of the variables, Auto Regressive Distributed Lag (ARDL) bounds testing approach to integration is applied. An index of institutional quality is constructed by Principal Component Analysis (PCA) considering twelve institutional indicators given by International Country Risk Guide (ICRG). The findings of the study reveal a positive relationship of public spending, institutional quality and stock market development on economic growth of the country. It is suggested that improvement of institutional quality, productive public spending and efficient financial markets are driving forces for economic prosperity and development of Pakistan. Keywords: Economic growth, Institutions, Stock market, Public spending JEL Classification: B22, C32, Q43 INTRODUCTION Economic growth is a vivid and ultimate source for economic development and prosperity which raises an economy’s potential GDP and must be sustained in long run to achieve the desired goal of public welfare. Economic growth is a fundamental instrument and indicator for sustainability and development of any economy. In long run, the focus of governments is to foster sustainable economic growth. The sustained growth of any country is helpful to improve living standard of people in many ways like reducing the poverty, enhancing the infrastructure and educational facilities, combating increased inflation, and reducing the external vulnerabilities. There is no consensus upon determinants of economic growth for an economy. Theoretical and numerical facts reveal that public spending, institutional quality and stock market have a pivotal role for economic growth. It may be observed that no society reaped towering echelon of economic growth without the intervention of government. Economies without interference of government face diverse hue of chaos that freezes their economic growth with passage of time. Government expenditures allow government to reallocation of resources from elite to poor. It is obvious that fiscal policy is a pre-condition to achieve macroeconomic permanence and sustainable economic growth that can have foremost impacts on income generation and poverty alleviation through taxation, optimal revenues generation, public borrowings and