FACTORS OF HUMAN DEVELOPMENT INDEX IN ASEAN:PANEL COINTEGRATION ANALYSIS

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            Volume 3 Issue 1 2019, Page

6.FACTORS OF HUMAN DEVELOPMENT INDEX IN ASEAN: PANEL COINTEGRATION ANALYSIS 
page - 
Debesh Bhowmik 
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FACTORS OF HUMAN DEVELOPMENT INDEX IN ASEAN: PANEL COINTEGRATION ANALYSIS

Debesh Bhowmik

Indian Economic Association (IEA) & The Indian Econometric Society (TIES), India

Corresponding Author's Email: debeshbhowmik269@gmail.com

ABSTRACT

In this paper, the author tried to relate HDI (Human Development Index) with GDP (Gross Domestic Product), education expenditure, health expenditure and unemployment rate in ASEAN-9 during 1990-2016 with fixed effect on panel regression, Fisher-Johansen cointegration and panel VECM (Vector Error Correction Model) respectively. The author found that one percent increase in GDP, education expenditure, and unemployment rate per year led to 0.105% increase, 0.028% increase and 0.027% decrease in HDI per year significantly and one percent increase in health expenditure led to 0.0124% increase in HDI insignificantly in ASEAN (Association of Southeast Asian Nations) during 1990-2016. Panel cointegration suggested that there are three cointegrating equations in which two are moving towards equilibrium. In panel VECM, it was found that-

2016. There is significant long run association among health expenditure percentage of GDP and unemployment rate on the Human Development Index (HDI) of the ASEAN during 1990-2016.
2017. There is significant long run association among health expenditure percentage of GDP and unemployment rate on the educational expenditure % of GDP of the ASEAN during 1990-2016.

• There is also a significant short run association among education expenditure on GDP, from HDI on education expenditure and from GDP on unemployment rate of ASEAN during 1990-2016.

Keywords: Human Development Index, Gross Domestic Product, Fixed Effect Regression, Panel Cointegration, Panel Vector Error Correction

INTRODUCTION

ASEAN is one of the leading regional trading blocs in Asia as well as in the world, but majority of its members are facing low GDP per capita and HDI value. Poverty and unemployment problems of ASEAN are randomly hampering the development process where both physical and human capital is suffering. Human capital as a function of growth through improvement in education and skill development and with high productivity should be a great concern in the ASEAN region. Human competitiveness index of ASEAN region is not satisfactory in the world economy. Even in the era of globalization and liberalization the human development factor is not given prior importance. The indicators of human development were not properly nourished. Therefore, the transformation of the economy through human development was underutilized. ASEAN as a single market for the goods, services, investment, skilled labor, free capital flows in accelerating economic integration process, intra and inter-competitiveness of human skill and productivity through human development. It is necessary because Lucas (1988) in his endogenous growth theory emphasized investment in human capital more directly and linked it to long term rates of economic growth. Sen (1999) argued that standard of living of a society should be judged not by the average level of income but by people’s capabilities to lead the life they value. On the one hand, economic growth provides the resources to permit sustained improvement in human development. On the other hand, sustained improvement in the quality of human capital is an important contribution to economic growth.

CONCLUSION

The paper concludes that fixed effect panel regression showed one percent increase in GDP, education expenditure, and unemployment rate per year led to 0.105% increase, 0.028% increase and 0.027% decrease in HDI per year significantly and one percent increase in health expenditure led to 0.0124% increase in HDI insignificantly in ASEAN during 1990-2016. Panel cointegration suggested that there are three cointegrating equations in which two are moving towards equilibrium. In panel VECM, it was found that [i] There is significant long run association among health expenditure percentage of GDP and unemployment rate on the human development index of the ASEAN during 1990-2016. [ii] There is significant long run association among health expenditure percentage of GDP and unemployment rate on the education expenditure percentage of GDP of the ASEAN during 1990-2016. [iii] There is significant short run association among education expenditure on GDP, from HDI on education expenditure and from GDP on unemployment rate of ASEAN during 1990-2016.

Women's Journey Towards Empowerment : Issues and Challenges edited by Prof. Prabhat Kumar Singh (Ranchi University) and Prof. Amit Bhowmik (Nur Mohammad Smriti Mahavidyalaya, Murshidabad)----2019

DELTON PUBLISHING HOUSE,NEWDELHI,HB,297+XXVII,Rs 1295.

It consists of 25 articles which cover wide range of women empowerment in the areas of agriculture, entrepreneurship, social sector, business, finance, in India and abroad .All articles are written by scholars of India and abroad. The foreword of this edited book is written by Prof. Elias Olukorede Wahab of Lagos State University, Nigeria.

                                                                    Article No-14

Women Empowerment with special emphasis on the relation among gender development index, human development index and gross domestic product per capita   pp 145-162

Dr.Debesh Bhowmik(Retired Principal,Life member IEA,TIES)

Abstract

In this paper, author wishes to find the relationship among the gender development index,human development index and the gross domestic product per capita of the 12 developed countries during 1990-2015 with the help of econometric models such as fixed effect panel regression, Fisher-Johansen panel co-integration , panel vector error correction model and Wald test .

The paper concludes that one per cent increase GDI per year led to 0.1143% increase in GDP per capita and 0.0191% increase in HDI per year significantly during 1990-2015 which were found by fixed effect panel regression. Fisher-Johansen panel co-integration test confirms that there is one co-integrating equation among GDP per capita, HDI and GDI during the survey period. The co-integrating equation tends to equilibrium which indicates that there is long run association among them. From the System equation of VECM it was verified that there is long run causality running from HDI and GDP per capita to GDI. Error correction process showed that the speed of adjustment is 95.25% per year significant. Wald test verified that there is no short causality running from HDI and GDP per capita to GDI and vice versa but there is short run causality running from HDI to GDP per capita. Over all, the VECM is stable, non-stationary, non-normal and serially correlated.

Key Words-gender development index, human development index, GDP per capita, Fisher-Johansen co-integration, panel vector error correction model, short run and long run causality.

JEL Classification –C23, J16, O15

The paper concludes that one per cent increase GDI per year led to 0.1143% increase in GDP per capita and 0.0191% increase in HDI per year significantly during 1990-2015 which were found by fixed effect panel regression. Fisher-Johansen panel co-integration confirms that there is one co-integrating equation among GDP per capita, HDI and GDI during the survey period. The co-integrating equation tends to equilibrium which indicates that there is long run association among them. From the System equation of VECM it was verified that there is long run causality running from HDI and GDP per capita to GDI. Error correction process showed that the speed of adjustment is 95.25% per year significant. Wald test verified that there is no short causality running from HDI and GDP per capita to GDI and vice versa but there is short run causality running from HDI to GDP per capita. Over all, the VECM is stable, non-stationary, non-normal and serially correlated.  

IMPACT OF HEALTH EXPENDITURE ON GDP,HDI,& UNEMPLOYMENT RATE IN ASEAN-7

ARTICLE

IMPACT OF HEALTH EXPENDITURE ON GDP,HDI AND UNEMPLOYMENT RATE IN ASEAN-7

BY   DR.DEBESH BHOWMIK

Published in INTERNATIONAL JOURNAL OF RESEARCH AND ANALYTICAL REVIEWS
SPECIAL ISSUE,JANUARY 2019,PAGE-184-197,ARTICLE NO-22.

There are 47 papers which were presented in the ICSSR sponsored International conference on "Emerging Socio-Economic Trends and Business Strategy" organised by International School of Business and Media,Kolkata during 18-19 January,2019.

IMPACT OF HEALTH EXPENDITURE ON GDP,HDI,& UNEMPLOYMENT RATE IN ASEAN-7

Abstract

In this paper author endeavours to relate the health expenditure of ASEAN-7 with GDP , HDI and unemployment rate of ASEAN-7 from 1990-2016 using panel data through the econometric models of fixed effect regression, panel cointegration and panel vector error correction model. The paper concludes that fixed effect panel regression among health expenditure % of GDP, HDI,unemployment rate and GDP of ASEAN-7 during 1990-2016 showed that one per cent increase in health expenditure per year led to 0.719% decrease in GDP per year but one per cent increase in HDI and unemployment rate per year led to step up 2.985% and 0.292% in GDP per year significantly.Johansen-Fisher panel cointegration confirmed that Trace and Max Eigen statistic showed two cointegrating equations where one cointegrating equation tends to equilibrium which implies that there is long run causality from GDP,HDI and unemployment rate of ASEAN-7 to the health expenditure as per cent of GDP during 1990-2016 where residuals VECM is stable,nonstationary,non-normal and serially correlated.Moreover,the Wald test suggests that there is short run causality running from health expenditure % of GDP of ASEAN-7 of previous periods to the change of GDP of ASEAN-7.

Key words : Health expenditure,human development index,unemployment rate,gross domestic product,fixed effect panel regression,cointegration,vector error correction,short run causality, long run causality.

JEL Classification code-C22,E24,F15,H15,I10,I18,J24,J64,O15,O40

VIII.Conclusions

The paper concludes that fixed effect panel regression among health expenditure % of GDP, Human Development Index, unemployment rate and GDP of ASEAN-7 during 1990-2016 showed that one per cent increase in health expenditure per year led to 0.719% decrease in GDP per year but one per cent increase in HDI and unemployment rate per year led to step up 2.985% and 0.292% in GDP per year significantly. Johansen-Fisher panel cointegration confirmed that Trace and Max Eigen statistic showed two cointegrating equations where one cointegrating equation tends to equilibrium which implies that there is long run causality from GDP,HDI and unemployment rate of ASEAN-7 to the health expenditure of ASEAN-7 as per cent of GDP during 1990-2016 where the residual test of  VECM is stable, nonstationary, non-normal and serially correlated. Moreover, the Wald test suggests that there is short run causality running from health expenditure % of GDP of ASEAN-7 of previous periods to the change of GDP of ASEAN-7.The paper also showed some limitations and discussed policy recommendations.

FEMALE EMPLOYMENT RATE IN INDIAN SECTORS :PANEL COINTEGRATION AND VECTOR ERROR CORRECTION ANALYSIS

FEMALE EMPLOYMENT RATE IN INDIAN SECTORS :PANEL COINTEGRATION AND VECTOR ERROR CORRECTION ANALYSIS

BY.......DR.DEBESH BHOWMIK

UTTARPRADESH UTTARAKHAND ECONOMIC ASSOCIATION ECONOMIC JOURNAL

VOLUME-14,CONFERENCE NO-14, OCTOBER 2018

14TH ANNUAL CONFERENCE ,GIDS LUCKNOW,
29-30 OCTOBER,2018,PAGE-304-309

FEMALE EMPLOYMENT RATE IN INDIAN SECTORS:PANEL COINTEGRATION AND VECTOR ERROR CORRECTION ANALYSIS

Dr.Debesh Bhowmik

Abstract

In this paper,author endeavours to evaluate empirical investigation on the sectoral female employment rate  in India during 1991-2016 through panel data analysis using regression, panel cointegration and panel vector error correction methodology taking sectoral shares, growth rates of sectors and value added in sectors as independent variables. The paper concludes that the panel regression found that female employment rate of all sectors is negatively related with GDP shares of sectors and growth rates of sectors during 1991-2016 in India. Fisher-Johansen panel cointegration test showed that there are two cointegrating equations among female employment rates of all sectors with GDP shares, growth rates of sectors and value added of the sectors during the said periods. The panel VECM is stable but nonstationary. In VECM system equations, Wald test suggested that there is long run association among growth rate of sectors, value added of sectors and female employment rate of all sectors and there is short causality from growth rates of sectors on shares of sectors and vice versa. Even, there is no short run causality from shares of sectors and growth rate of sectors on value added of sectors. There is no short run causality running from shares of sectors, growth rates of sectors and value added of sectors on female employment rate in all sectors.

Key words-sectoral employment rate, female employment rate, sectoral shares, sectoral growth rates, value added in sectors, Fisher-Johansen cointegration, vector error correction

JEL Classification-C33,J21,J64,L60,L80,Q10

The paper concludes that the panel regression found that female employment rate of all sectors is negatively related with GDP shares of sectors and growth rates of sectors during 1991-2016 in India. Fisher-Johansen panel cointegration test showed that there are two cointegrating equations among female employment rates of all sectors with GDP shares, growth rates of sectors and value added of the sectors during the said periods. The panel VECM is stable but nonstationary. In VECM system equations, Wald test suggested that there is significant long run association among growth rate of sectors, value added of sectors and female employment rate of all sectors and there is short causality from growth rates of sectors on shares of sectors and vice versa. Even, there is no short run causality from shares of sectors and growth rate of sectors on value added of sectors. There is no short run causality running from shares of sectors, growth rates of sectors and value added of sectors on female employment rates in all sectors.