Purpose This paper aims to examine the impact of central bank independence (CBI), both de jure and de facto, on the fiscal deficit (FD) in the case of India from 1980–1981 to 2018–2019. With the level of financial development proxied by the ratio of private credit to government as a possible source of nonlinearity, this study explores the possibility of a non-linear association between the CBI and FD. Design/methodology/approach This study estimated a logistic smooth transit regression (LSTR) to uncover the possible nonlinearity. To quantify the de jure and de facto independence of the Central Bank of India, i.e. RBI, this study follows Jasmine et al. (2019) and Cukierman et al. (1992). Findings The results reported regime dependence of the effect of CBI on FD. In both the short and long run, FD and CBI are found to be positively related during a low financial development regime, and when the economy is in a high financial development regime, FD and CBI are found to be negatively related. Moreover, an increase in GDP growth rate is found to trim the FD, whereas an increase in trade openness, oil prices, and the central bank governor (TOR) turnover rate increases it. Practical implications The findings of this study highlight the significance of the level of financial development that enables the independent central bank to ensure discipline on the part of fiscal authorities and improve fiscal balances. Moreover, robust GDP growth, more de facto independence of the central bank, and less oil price inflation would be favourable to ensure improvements in fiscal balance. The results imply the significance of the level of financial development in making central bank independence a potent tool to ensure fiscal prudence. Originality/value To the best of authors’ knowledge, no study has been conducted to understand the non-linear impact of the independence of the Reserve Bank of India on the fiscal deficit in the case of the Indian economy, subject to the level of financial development. The non-linear results provide important input to policymakers regarding the relevance of the level of financial development to the effectiveness of central bank independence and fiscal prudence on the part of the government.

Purpose This research explores the relationship between digital financial inclusion, technological innovation and unemployment. This study aims to examine how progress in digital finance and technology influences unemployment rates. Design/methodology/approach Drawing on data from 101 countries covering the years 2004–2020, the study uses several econometric techniques. These include the two-step system generalized method of moments (GMM), two-stage least squares (2SLS), propensity score matching (PSM) and entropy balancing to address concerns related to endogeneity. To ensure the robustness of the results, the analysis also incorporates alternative indicators and conducts subsample analysis for both developed and developing nations. Findings The main findings reveal that both digital financial inclusion and technological innovation are significantly associated with lower unemployment rates. These negative effects remain consistent across different models and data subgroups, highlighting the robustness of the results. The use of other methods such as the two-step system GMM, 2SLS, PSM and entropy balancing strengthens the robustness of the conclusions drawn. Originality/value This study offers fresh perspectives on how digital finance and technological advancements can serve as tools to combat unemployment. By applying a range of analytical approaches and examining multiple proxy measures, the research delivers a well-rounded analysis of how digital and technological developments relate to labor market outcomes.

Purpose This paper aims to investigate how renewable energy index interacts and interrelates with developed and emerging stock markets and what the effect of uncertainties surrounding the pandemic and economic policy is on their connectedness from December 29, 2000, to March 23, 2022. Design/methodology/approach The Diebold and Yilmaz (2012, 2014) methodology is used to measure connectedness from three perspectives: total connectedness, total directional connectedness and pairwise directional connectedness. Furthermore, the authors examine the effects of economic, pandemic and financial uncertainty indices on this connectedness. Findings The authors find significant evidence that the volatility connectedness changes over time and reaches peak during global financial crisis and the onset of the COVID 19 crisis. In addition, the connectedness index has consistently reported that advanced equity markets are more connected with clean energy stocks than that in emerging economies. Moreover, the specific uncertainty indices all have a positive impact on the connectedness except the EPU effect in emerging countries. Originality/value This paper takes an initial attempt to provide a clear-cut investigation about the connectedness between renewable energy index and different stock markets with emphasis on the significant crisis periods. These insights can be used by investors in renewable energy to inform diversification benefits at different investment horizons and policymakers to create a stable and predictable renewable energy regulatory framework.

Purpose This study aims to examine the motivations and drivers affecting Gen Z Vietnamese employees’ intentions to pursue a master’s degree. Design/methodology/approach Drawing from the three sources of motivation framework and expectancy-value theory of motivation, this study combines both qualitative and quantitative research methods to develop and test a conceptual model linking motivations, individual and contextual factors that could shape such motivations, and the intention to pursue a master’s degree. Data collected from a survey of 396 Vietnamese Gen Z employees are analyzed by partial least squares structural equation modeling using SmartPLS 4.0. Findings The results show that process-based motivations, including cognitive interest and escape motivation, are more significant than professional advancement and external expectations in predicting the intention to pursue a master’s degree among Gen Z employees. These motivations also transmit the effects of perceived wellness and satisfaction with educational services at the bachelor’s degree level. Practical implications The findings suggest that educational policymakers and university administrators should encourage the workforce to engage in lifelong learning by activating and satisfying their intrinsic motivations. Originality/value This study adds a new theoretical perspective on the role of psychological factors in the context of higher education.

Purpose This study aims to contribute to the literature on geopolitical tensions (GPTs) and consumer price index (CPI) by studying their relationship across both the time and frequency space. Design/methodology/approach The time period of the study spans from January 1993 to October 2023. Bivariate wavelet coherence analysis is used to study the co-movements. Findings However, it is interesting to note that the degree of these relationships varies and swings over time periods. Although there is a strong substantial correlation between GPTs and CPI at some phases of the study period, particularly in times of various crises, it is restricted to specific timeframes only. This may be due to the effect of some external shocks, i.e. GPTs in our case. The study suggests that governments should implement comprehensive policies to address inflation during GPTs. To minimise the adverse impact of geopolitical events, governments must reduce dependence on geopolitically sensitive countries and diversify sources of suppliers and trade partners. Further, eye-opening results of this study undoubtedly urge policymakers to take into account GPTs-related indicators in their inflation projection models and monetary policy frameworks. Research limitations/implications The study suggests that governments should implement comprehensive policies to address inflation during GPTs. To minimise the adverse impact of geopolitical events, governments must reduce dependence on geopolitically sensitive countries and diversify sources of suppliers and trade partners. Further, eye-opening results of this study undoubtedly urge policymakers to take into account GPTs-related indicators in their inflation projection models and monetary policy frameworks. Originality/value The uniqueness of our study lies in unravelling the interesting connectedness between GPTs and the CPI for the 16 most geopolitically vulnerable countries with the application of wavelet coherence analysis that also considers any change in the CPI as an effect of GPTs over a given period.

Purpose This paper aims to study the transmission of shocks from global macroeconomic variables to international trade volumes of an emerging market economy. Design/methodology/approach This paper estimates the return and volatility spillovers from global factors such as crude price, global economic activity and global policy uncertainty to India’s imports and exports. This paper also includes the effects of real exchange rate, credit availability, domestic output gap and domestic policy uncertainty. The paper uses wavelet time-scale decomposition analysis to extract the spillovers received by imports and exports at various frequencies, which are otherwise invisible in the raw data. The conditional volatility of variables is extracted using the ARMA-GARCH model. Findings The results show that India’s imports and exports receive return spillovers from real exchange rate, credit availability, crude price and global economic policy uncertainty at lower frequencies. India’s exports receive volatility spillovers from global economic activity at higher frequencies. Research limitations/implications Because different factors impact trade cycles in the short term and long term, understanding the spillovers at different frequencies is essential for policymakers, businesses and investors to prepare for potential economic fluctuations. Practical implications This paper observes spillovers from REER to trade at lower frequency cycles, which calls for better foreign exchange hedging options in the medium to long term. Social implications Enhancing economic partnerships, reducing trade barriers and attracting foreign capital to foster local production could help manage trade spillovers. Originality/value While existing studies used the wavelet method to estimate spillovers in economic and financial variables, to the best of the authors’ knowledge, there is no study using this method to examine spillover from global and domestic macroeconomic variables to international trade. This paper fills this gap.

Purpose India’s hefty gold imports, comprising 9.27% of total merchandise imports and 35.75% of trade deficit in 2020, strains the current account, necessitating swift import control. This study aims to explore the factors driving India’s gold demand in both the short and long run, whether for consumption or investment purposes. Design/methodology/approach This study uses a variety of scientific techniques, such as descriptive statistics, unit root analysis (with and without structural break tests), Brock, Dechert, and Scheinkman (BDS) test and non-linear autoregressive distributed lag cointegration technique. Findings This study reveals that long-term demand for gold imports remains resilient regardless of price fluctuations. In contrast, short-term demand is primarily influenced by price reductions, with increases in gold prices having insignificant impact. This study posits that the inverse relationship between falling gold prices and imports stems from consumption-driven demand, whereas the direct correlation between rising prices and imports is fuelled by investment motives in the long run. Research limitations/implications Policymakers may find nonprice measures more effective and efficient in managing gold imports and addressing long-term trade imbalances. Originality/value This paper, therefore, aspires to empirically examine the impacts of gold price on gold imports demand in India by analysing annual data from 1975 to 2020.

Purpose This study aims to investigate the effect of financial globalization and economic and political institutions on macroeconomic volatility in the Sub-Saharan Africa (SSA). In addition, the study examines the absorptive capacity of economic and political institutions in the link between financial globalization and macroeconomic volatility. Design/methodology/approach This study extracted data from twenty-seven SSA countries between 1991 and 2021. The study applies cross-sectional dependency tests, second-generation unit root tests and Driscoll and Kraay (1998) panel spatial correlation consistent (PSCC) standard errors to drive out the study’s conclusion. Findings The result suggests that financial globalization significantly contributes to macroeconomic volatility in the direct model, whereas its indirect effect rests largely on the indicators of economic and political institutions. For economic and political institutions, bureaucratic quality, democratic accountability and government stability negatively influence macroeconomic volatility. However, the effect of corruption control and law and order is insignificant. The interactive term of financial globalization and institutions shows that financial globalization interacted with democratic accountability, government stability and law and order, negatively affect macroeconomic volatility. On the other hand, the interactive effect of financial globalization with bureaucratic quality is significantly positive, whereas the interactive impact of financial globalization with corruption control is not significant. The net effect reveals that bureaucratic quality, democratic accountability, government stability and law and order moderate the positive effect of financial globalization on macroeconomic volatility in the region. Practical implications This study recommends the need to strengthen the economic and political institutions and develop the financial sector to cushion the effect of financial globalization on macroeconomic volatility. Originality/value This study adds to the body of knowledge by unearthing the moderating effect of economic and political institutions in the linkages between financial globalization and macroeconomic volatility, especially in SSA.

Purpose This study aims to examine whether there is a symmetric and asymmetric causality relationship between oil prices and financial stress. Design/methodology/approach The study applies Gregory–Hansen’s (1996) cointegration and Nazlioglu et al.’s (2016) Fourier-Toda-Yamamoto (F-TY) causality approaches to monthly data from six European core economies: Germany, the United Kingdom, France, Italy, The Netherlands and Spain, covering the period 1987:M05-2023:M08. Findings Except for Spain, the authors find a symmetric causality relationship between oil prices and financial stress across the sampled countries in at least one or both directions. Regarding asymmetric causality, the results reveal a feedback causality relationship between positive shocks in financial stress and negative oil price shocks in Germany and France; a unidirectional causality from positive financial stress shocks (heightened financial stress) to negative oil price shocks (sudden price decreases) in Italy and Spain; a one-way causality from negative financial stress shocks to positive oil price shocks (sudden price increases) in the UK; and no causality in The Netherlands. Originality/value This study adds to the body of knowledge in three ways. First, it enriches the limited empirical research on the asymmetric causality relationship between financial stress and oil price shocks. Second, it uses a newly developed Fourier-Toda-Yamamoto (F-TY) causality approach that yields reliable results even for structural breaks. Finally, given the importance of oil as a vital input for six European core economies that import oil, identifying the link with financial stress can provide policymakers and scholars with fresh policy insights and research opportunities.

PurposeWith the rise of mandating climate-related disclosures (CRD), this paper aims to investigate how energy and agriculture markets are exposed to climate disclosure risk.Design/methodology/approachUsing the multivariable simultaneous quantile regression and data from 1 January 2017 to 29 February 2024, the authors examine daily and monthly responses of energy and agriculture markets to climate disclosure risk, energy risk, market sentiment, geopolitical risk and economic policy risk. The sample covers the global market, Australia, Canada, European Union (EU), Hong Kong, Japan, New Zealand, Singapore, the UK and the USA.FindingsThe results show that climate disclosure risk creates both positive and negative shocks in the energy and agriculture markets, and the impacts are asymmetric across quantiles in different economies. The higher the climate disclosure risk, the greater impact of crude oil future on the energy sector in North America (Canada and the USA) and Europe (EU and the UK), but no greater effects in Asia Pacific (Australia, New Zealand and Singapore). The agriculture sector can hedge against economic policy and geopolitical risks, but it is highly exposed to climate disclosure and energy risks.Originality/valueThis study timely contributes to the modest literature on the asymmetric effects of climate disclosure risk on the energy and agriculture markets at the global and national levels. The findings offer practical implications for policymakers and investment practitioners in understanding financial effects of mandating CRD to diversify risks depending upon market conditions and policy uncertainty.