DOI: 10.32609/j.ruje.11.164511

Authors: Zainab Mourad, Mert Gül

Abstract: Despite the growing emphasis on the nexus between growth and macroeconomic indicators, research on the influence of cryptocurrencies on economic performance remains limited. This study compares the impact of two leading cryptocurrencies, Bitcoin and Ethereum, on economic growth, alongside inflation, market uncertainty, and oil and gold prices, using panel data from 14 countries between Q3 2015 and Q3 2023. The results demonstrate robust cross-sectional dependence, indicating that economic shocks in one country affect the entire group. Therefore, second-generation tests are employed to confirm the presence of stationarity in the variables. Except for Bitcoin’s trading volume, panel fully modified ordinary least squares estimations reveal a significantly positive impact of cryptocurrencies on growth. Cointegration is present in the long run, while in the short run, strong bi- and unidirectional causality is found for all cryptocurrency proxies. The study provides insights that can help policymakers develop strategies to align economic growth with the crypto market, benefiting the broader economy.

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DOI: 10.32609/j.ruje.11.154180

Authors: Wasim Ullah

Abstract: Financial development plays a crucial role in shaping economic growth, yet it can introduce volatility. This study examines the relationship between financial development and economic growth volatility. Using panel data from 60 countries (30 developed and 30 developing) for 1981–2022, we employ panel-corrected standard errors and generalized method of moments to ensure robustness. Financial development is analyzed through financial institutions and financial markets across three dimensions: depth, access, and efficiency. Conceptually, the paper finds that the supply-leading hypothesis does not account for the economic growth volatility associated with excessive financialization. The results indicate that, at higher levels, financial development has a volatility-enhancing impact in developed countries, while in developing countries it has a volatility-reducing effect. Policymakers in developed countries should ensure that credit expansion is aligned with real-sector development. Regulators should monitor adverse effects of financial depth and ensure funds are directed toward real-sector growth, while improving access and efficiency. In a too‑much-finance scenario, economies need moderators — such as strong regulatory quality and well-defined rights for creditors and borrowers — to mitigate volatility-enhancing effects.

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DOI: 10.32609/j.ruje.10.128666

Authors: Shweta Sikhwal

Abstract: This paper quantifies the spillover effects of economic policy uncertainty (EPU) in the United States on emerging market economies (EMEs). Using a generalized method of moments (GMM) estimation of a panel vector autoregression (PVAR) model on a dataset of 39 EMEs from 2005 to 2019, we find that increased U.S. EPU significantly raises the consumer price index (CPI) and negatively impacts the real GDP of these economies. Additionally, heightened U.S. EPU leads to a depreciation of emerging market currencies and a reduction in short-term interest rates. We employ a news-based EPU index developed by Baker et al. (2016) and conduct robustness checks using forward orthogonal transformation, an alternative EPU index, and by addressing the potential endogeneity of the oil price uncertainty (OPU) index. Our findings highlight the adverse effects of U.S. economic policy uncertainty on key macroeconomic variables in emerging markets, underscoring the importance of stable economic policies and robust institutions to mitigate these impacts.

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DOI: 10.1016/j.ruje.2017.09.006

Authors: Shigeki Ono

Abstract: This paper examines the finance-growth nexus in Russia with the vector autoregression model, taking oil prices and foreign exchange rates into account. The analyzed period is from 1999 through 2008 (Subperiod 1) and from 2009 through 2014 (Subperiod 2). The results for Subperiod 1 suggest that there is causality from economic growth to money supply and bank lending, which implies demand-following responses. The results for Subperiod 2 show that economic growth Granger causes bank lending while there is no causality from money supply to economic growth, which could be related to the dramatic decrease in the amount of intervention in foreign exchange markets.

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DOI: 10.1016/j.ruje.2016.02.005

Authors: Sergey Beshenov, Ivan Rozmainsky

Abstract: This article attempts to analyze the current debt crisis in Greece based on the financial instability hypothesis developed by Hyman Minsky. This article shows that the hypothesis provides an understanding of how an economy endogenously becomes “financially fragile” and thus prone to crises. The authors analyze how public and private sector behavior in the Greek economy led to the country's debt crisis. In particular, based on a sample of 36 Greek companies, the authors show that between 2001 and 2014, the majority of those companies had switched to fragile financial structures. Special attention is devoted to the negative consequences of applying the neoclassical doctrine of “austerity measures” in Greece as the principal “anti-crisis” concept of mainstream economic science.

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