Mahmoud Al-Rdaydeh

Each economic factor generates both positive and negative externalities regarding environmental quality. Owing to this, the current study aims to explore the impacts of various economic variables on the environmental quality of the Gulf Cooperation Council (GCC) region. By sampling the 24 years (1996–2019) financial statistics of six GCC region countries, we investigate the impact of economic growth, foreign investment, trade volume, tourism investment and revenue, and electricity production on CO₂ emissions. The empirical analysis is based upon dynamic least square and fully modified ordinary least square model due to the existence of cointegration. Following the results, economic growth, foreign investment, tourism investment, electricity production, and population density have a positive impact, while trade volume and banking development have a negative impact on the volume of CO₂ emissions. The results support the pollution haven hypothesis in the GCC region and have many policies for environmental economists regarding the protection of the natural environment in the long run. In parallel to economic growth, the policy officials from the GCC region should focus on environmental sustainability. They should exert more effort for developing sustainable economic growth policies. The current analysis offers new insights regarding the dynamic role of various economic factors in establishing the CO₂ emission volume in the GCC region.

This paper observes the dynamic impact of market risks on the profitability of banks listed on the Amman Stock Exchange (ASE) from 2010 to 2018 in Jordan. To identify the link, the relevant data were retrieved from the annual statements of Jordanian banks and one-step Generalized Method of Moments (GMM) approach was employed to diagnose the error regarding endogeneity. The results of the applied methodology showed that market risks impacted the profitability of Jordanian banks. Furthermore, the study also presented factors that affected the banks’ profitability, such as capitalization and bank size. The previous year profitability has a positive effect on the next year profitability. Moreover, stock market returns (SMRs) directly affect ROA and ROE because when SMRs enhances, bank profitability will increase. Bank managers should ponder the volatility of the market risk while enhancing the profitability of a bank. This relationship of the variables regarding Jordanian banks listed on the ASE was not considered before in the financial economics literature. Recommendations were also provided for Jordanian bank managers to mitigate market risks.

This study investigates the relationship among electricity consumption, per capita GDP, and CO₂ emissions for the Kingdom of Saudi Arabia. Trade openness and urbanisation are included within a multivariate approach. Using data covering the 1971–2018 period, the wavelet-coherence analysis is applied to assess the interactions amongst variables. All variables except trade openness appear highly correlated with CO₂ emissions. This is further confirmed by our causality testing procedure (i.e. the Johansen and Juselius test for cointegration and the Granger Causality test applied on a Vector Auto-Regressive model) which shows that electricity consumption, per capita income and urbanisation are crucial determinants of CO₂ emissions. Accordingly, adequate policy measures are proposed to turn the Saudi power sector towards a sustainable path.

In this article, the co-movement between GCC and US stock market returns was investigated using the wavelet coherence method. The Dynamic Conditional Correlation GARCH (DCC-GARCH) modelling is then applied on time-varying components in order to provide a point of comparison with the results extracted from wavelet analysis. The investigation was conducted on the weekly stock index prices of two USA stock markets, namely Dow Jones and S&P 500 and six GCC stock markets, namely the United Arab Emirates, Saudi Arabia, Qatar, Oman, Kuwait, and Bahrain. The data were retrieved from Thomson Reuters’s data stream and the sample duration was from 7 January 2007 to 24 June 2018. As a result, a definite co-movement between several GCC stock markets and those of the US stock markets for a long term was found. Moreover, the results also displayed signs of the significant disparity between the co-movements of the stock markets throughout the scales of time during economic decline. This phenomenon was possibly expected during the economic decline, where a significant divergence occurred as opposed to co-movement. The implications of the findings for global investors were considerable due to the indication from long-term co-movement that these investors would not be capable of gaining simultaneous profit from time and portfolio being diversified. In fact, the results showed the major difference in the opportunities for international portfolio diversification throughout these markets in terms of scale and time.

The effect of the international currency crises on the Jordanian balance of payments (BoP) between Q1-2000 and Q4-2017 was investigated in this paper. The currency crises are represented by the various exchange rates (ER) for the Japanese Yen, United States (US) Dollar, Euro Member Countries, China Renminbi, and the United Kingdom (UK) Pound with the Jordanian Dinar. In approximating the potential short-run and long-run associations among the different ER variations and the BoP, the ARDL bounds testing technique was employed. The empirical findings revealed that variation in the ER rate for EUR/JOD had a positive significant impact on the BOP for the short-run and long-run relation, whereas, opposingly, for the JPY/JOD, it had a negative significant impact on the BoP in the short-run and long-run relations. For other currencies, the results varied. Therefore, to reduce the effect of currency fluctuations and resultant crises on the BoP, over-reliance on the promotion and importation of goods and domestic export products should be avoided. As such, in the context of the Jordanian economy, the country needs to diversify. Accordingly, this can only be achieved if the economy is expanded along with advancing and developing entrepreneurial innovation supported by fiscal disciplines.

Past studies have mostly investigated the significance of financial attributes in trade affairs of developed countries, while dismissing such importance among developing nations. As such, this study looked into the influence of financial leverage upon the growth of Jordanian firms. For that purpose, a sample of 91 firms from Jordan had been analyzed via panel data regression method for the period between 2006 and 2015. As a result, the findings portrayed the irrelevance between financial leverage and growth of assets, but a significantly positive correlation with the growth of sales and employment. On top of that, this study revealed that growth of sales and employment had been significantly and positively correlated with firm size. In short, this study dismissed the speculation the constraint Jordanian firms were in, but on the contrary, displayed the ability to gain external financing to ascertain successful progress.