IDEAS home Printed from https://ideas.repec.org/a/gam/jmathe/v10y2022i19p3660-d934654.html
   My bibliography  Save this article

What Drives Economic Growth across European Countries? A Multimodal Approach

Author

Listed:
  • Larissa M. Batrancea

    (Department of Business, Babeş-Bolyai University, 7 Horea Street, 400174 Cluj-Napoca, Romania)

  • Mehmet Ali Balcı

    (Department of Mathematics, Muğla Sıtkı Koçman University, 48000 Muğla, Turkey)

  • Ömer Akgüller

    (Department of Mathematics, Muğla Sıtkı Koçman University, 48000 Muğla, Turkey)

  • Lucian Gaban

    (Faculty of Economics, “1 Decembrie 1918” University of Alba Iulia, 15−17 Unirii Street, 510009 Alba Iulia, Romania)

Abstract

This research study examines the factors that determined economic growth measured by gross domestic product, gross value added, final consumption expenditure of households, and gross fixed capital formation across a sample of 36 European countries during the time frame Q3 2018−Q3 2021. We conducted a panel data analysis with the first-difference generalized method of moments (GMM) approach and cross-section fixed effects. Empirical results estimated with four econometric models indicated a significant robust impact of the independent variables exports, imports, foreign direct investment inflow, foreign direct investment outflow, social contributions, and wages on economic growth proxies. In addition, multiplex network analysis was used to investigate the connection architectures of the 36 countries, and it yielded statistical measurements for all layers in the multi-layered structure. Relevant policy implications of reported empirical results are also addressed.

Suggested Citation

  • Larissa M. Batrancea & Mehmet Ali Balcı & Ömer Akgüller & Lucian Gaban, 2022. "What Drives Economic Growth across European Countries? A Multimodal Approach," Mathematics, MDPI, vol. 10(19), pages 1-20, October.
    • Handle: RePEc:gam:jmathe:v:10:y:2022:i:19:p:3660-:d:934654
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-7390/10/19/3660/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2227-7390/10/19/3660/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Daron Acemoglu & Asuman Ozdaglar & Alireza Tahbaz-Salehi, 2017. "Microeconomic Origins of Macroeconomic Tail Risks," American Economic Review, American Economic Association, vol. 107(1), pages 54-108, January.
    2. Markus Brueckner, 2021. "Infrastructure and Economic Growth," JRFM, MDPI, vol. 14(11), pages 1-13, November.
    3. Sergei Aliukov & Jan Buleca, 2022. "Comparative Multidimensional Analysis of the Current State of European Economies Based on the Complex of Macroeconomic Indicators," Mathematics, MDPI, vol. 10(5), pages 1-29, March.
    4. Daron Acemoglu & Ufuk Akcigit & William Kerr, 2016. "Networks and the Macroeconomy: An Empirical Exploration," NBER Macroeconomics Annual, University of Chicago Press, vol. 30(1), pages 273-335.
    5. Chen, Baizhu & Feng, Yi, 2000. "Determinants of economic growth in China: Private enterprise, education, and openness," China Economic Review, Elsevier, vol. 11(1), pages 1-15.
    6. Matthew O. Jackson & Brian W. Rogers & Yves Zenou, 2017. "The Economic Consequences of Social-Network Structure," Journal of Economic Literature, American Economic Association, vol. 55(1), pages 49-95, March.
    7. Haydn Washington, 2021. "Questioning the Assumptions, Sustainability and Ethics of Endless Economic Growth," JRFM, MDPI, vol. 14(10), pages 1-15, October.
    8. Daron Acemoglu & Asuman Ozdaglar & Alireza Tahbaz-Salehi, 2015. "Systemic Risk and Stability in Financial Networks," American Economic Review, American Economic Association, vol. 105(2), pages 564-608, February.
    9. Vega-Redondo,Fernando, 2007. "Complex Social Networks," Cambridge Books, Cambridge University Press, number 9780521674096.
    10. J. Vernon Henderson & Adam Storeygard & David N. Weil, 2012. "Measuring Economic Growth from Outer Space," American Economic Review, American Economic Association, vol. 102(2), pages 994-1028, April.
    11. Tumminello, Michele & Lillo, Fabrizio & Mantegna, Rosario N., 2010. "Correlation, hierarchies, and networks in financial markets," Journal of Economic Behavior & Organization, Elsevier, vol. 75(1), pages 40-58, July.
    12. Ching-Fu Chen & R. Rothschild, 2010. "An Application of Hedonic Pricing Analysis to the Case of Hotel Rooms in Taipei," Tourism Economics, , vol. 16(3), pages 685-694, September.
    13. Panagiotis Pegkas & Christos Staikouras & Constantinos Tsamadias, 2020. "On the determinants of economic growth: Empirical evidence from the Eurozone countries," International Area Studies Review, Center for International Area Studies, Hankuk University of Foreign Studies, vol. 23(2), pages 210-229, June.
    14. Daron Acemoglu & Vasco M. Carvalho & Asuman Ozdaglar & Alireza Tahbaz‐Salehi, 2012. "The Network Origins of Aggregate Fluctuations," Econometrica, Econometric Society, vol. 80(5), pages 1977-2016, September.
    15. Vega-Redondo,Fernando, 2007. "Complex Social Networks," Cambridge Books, Cambridge University Press, number 9780521857406.
    16. Mahieddine Adnan Ghecham, 2022. "The Impact of COVID-19 on Economic Growth of Countries: What Role Has Income Inequality in It?," Economies, MDPI, vol. 10(7), pages 1-13, July.
    17. Inés Tejado & Emiliano Pérez & Duarte Valério, 2020. "Fractional Derivatives for Economic Growth Modelling of the Group of Twenty: Application to Prediction," Mathematics, MDPI, vol. 8(1), pages 1-21, January.
    18. Stern, Nicholas, 1991. "The Determinants of Growth," Economic Journal, Royal Economic Society, vol. 101(404), pages 122-133, January.
    19. Mehmet Ali Balcı & Larissa M. Batrancea & Ömer Akgüller & Anca Nichita, 2022. "Coarse Graining on Financial Correlation Networks," Mathematics, MDPI, vol. 10(12), pages 1-16, June.
    20. Osama Alhendi & József Tóth & Péter Lengyel & Péter Balogh, 2021. "Tolerance, Cultural Diversity and Economic Growth: Evidence from Dynamic Panel Data Analysis," Economies, MDPI, vol. 9(1), pages 1-16, February.
    21. D. Sornette & J. V. Andersen, 2001. "A Nonlinear Super-Exponential Rational Model of Speculative Financial Bubbles," Papers cond-mat/0104341, arXiv.org, revised Apr 2002.
    22. Besime Fekri Ziberi & Donat Rexha & Xhemazie Ibraimi & Besnik Avdiaj, 2022. "Empirical Analysis of the Impact of Education on Economic Growth," Economies, MDPI, vol. 10(4), pages 1-10, April.
    23. Li, Xiaoying & Liu, Xiaming, 2005. "Foreign Direct Investment and Economic Growth: An Increasingly Endogenous Relationship," World Development, Elsevier, vol. 33(3), pages 393-407, March.
    24. Larissa Batrancea & Malar Mozhi Rathnaswamy & Ioan Batrancea, 2021. "A Panel Data Analysis of Economic Growth Determinants in 34 African Countries," JRFM, MDPI, vol. 14(6), pages 1-15, June.
    25. D. Sornette & J. V. Andersen, 2002. "A Nonlinear Super-Exponential Rational Model Of Speculative Financial Bubbles," International Journal of Modern Physics C (IJMPC), World Scientific Publishing Co. Pte. Ltd., vol. 13(02), pages 171-187.
    26. Mikhail Lvovitch Dorofeev, 2022. "Interrelations between Income Inequality and Sustainable Economic Growth: Contradictions of Empirical Research and New Results," Economies, MDPI, vol. 10(2), pages 1-23, February.
    27. Benjamin Golub & Matthew Elliott, 2022. "Networks and Economic Fragility," Annual Review of Economics, Annual Reviews, vol. 14(1), pages 665-696, August.
    28. Mohammad Mafizur Rahman & Xuan-Binh (Benjamin) Vu & Son Nghiem, 2022. "Economic Growth in Six ASEAN Countries: Are Energy, Human Capital and Financial Development Playing Major Roles?," Sustainability, MDPI, vol. 14(8), pages 1-17, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Larissa M. Batrancea & Horia Tulai, 2022. "Thriving or Surviving in the Energy Industry: Lessons on Energy Production from the European Economies," Energies, MDPI, vol. 15(22), pages 1-16, November.
    2. Koppiahraj Karuppiah & Bathrinath Sankaranarayanan & Syed Mithun Ali & Ernesto D. R. Santibanez Gonzalez, 2023. "Impact of Circular Bioeconomy on Industry’s Sustainable Performance: A Critical Literature Review and Future Research Directions Analysis," Sustainability, MDPI, vol. 15(14), pages 1-17, July.
    3. Bing Wang & Wenjie Bi & Haiying Liu, 2023. "Dynamic Pricing with Parametric Demand Learning and Reference-Price Effects," Mathematics, MDPI, vol. 11(10), pages 1-14, May.
    4. Linshu Qiu & Dongxiao Yang & Kairong Hong, 2023. "Multidimensional Preference Game and Extreme Dispute Resolution for Optimal Compensation of House Expropriation," Mathematics, MDPI, vol. 11(11), pages 1-20, May.
    5. Hyoungjin Lee, 2023. "Surviving the Time: CEO Tenure and Its Impact on Risky Foreign Direct Investment in Conflict-Prone Belt and Road Initiative Participant Countries," Sustainability, MDPI, vol. 15(17), pages 1-18, September.
    6. Pejman Peykani & Mostafa Sargolzaei & Mohammad Hashem Botshekan & Camelia Oprean-Stan & Amir Takaloo, 2023. "Optimization of Asset and Liability Management of Banks with Minimum Possible Changes," Mathematics, MDPI, vol. 11(12), pages 1-24, June.
    7. Yuexia Han & Zhuang Chen & Yuxin Hu & Liyan Zhang & Huishan Fu & Renyong Zhang & Wei Zhang, 2023. "A PIE analysis of China’s commercial space development," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-11, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mundt, Philipp, 2021. "The formation of input–output architecture: Evidence from the European Union," Journal of Economic Behavior & Organization, Elsevier, vol. 183(C), pages 89-104.
    2. Brancaccio, Emiliano & Giammetti, Raffaele & Lopreite, Milena & Puliga, Michelangelo, 2019. "Monetary policy, crisis and capital centralization in corporate ownership and control networks: A B-Var analysis," Structural Change and Economic Dynamics, Elsevier, vol. 51(C), pages 55-66.
    3. Yoshiyuki ARATA & Philipp MUNDT, 2019. "Topology and Formation of Production Input Interlinkages: Evidence from Japanese microdata," Discussion papers 19027, Research Institute of Economy, Trade and Industry (RIETI).
    4. Seyit Kerimkhulle & Natalia Obrosova & Alexander Shananin & Gulmira Azieva, 2022. "The Nonlinear Model of Intersectoral Linkages of Kazakhstan for Macroeconomic Decision-Making Processes in Sustainable Supply Chain Management," Sustainability, MDPI, vol. 14(21), pages 1-21, November.
    5. Anja Kukuvec & Harald Oberhofer, 2018. "The Propagation of Business Sentiment within the European Union?," WIFO Working Papers 549, WIFO.
    6. Ashani Amarasinghe & Roland Hodler & Paul A. Raschky & Yves Zenou, 2018. "Spatial Diffusion of Economic Shocks in Networks," CESifo Working Paper Series 7001, CESifo.
    7. Peydró, José-Luis & Jiménez, Gabriel & Kenan, Huremovic & Moral-Benito, Enrique & Vega-Redondo, Fernando, 2020. "Production and financial networks in interplay: Crisis evidence from supplier-customer and credit registers," CEPR Discussion Papers 15277, C.E.P.R. Discussion Papers.
    8. Bartesaghi, Paolo & Clemente, Gian Paolo & Grassi, Rosanna & Luu, Duc Thi, 2022. "The multilayer architecture of the global input-output network and its properties," Journal of Economic Behavior & Organization, Elsevier, vol. 204(C), pages 304-341.
    9. Ernesto Pasten & Raphael S. Schoenle & Michael Weber & Michael Weber, 2017. "Price Rigidities and the Granular Origins of Aggregate Fluctuations," CESifo Working Paper Series 6619, CESifo.
    10. Bernard Herskovic & Bryan Kelly & Hanno Lustig & Stijn Van Nieuwerburgh, 2020. "Firm Volatility in Granular Networks," Journal of Political Economy, University of Chicago Press, vol. 128(11), pages 4097-4162.
    11. Jennifer La'O & Alireza Tahbaz‐Salehi, 2022. "Optimal Monetary Policy in Production Networks," Econometrica, Econometric Society, vol. 90(3), pages 1295-1336, May.
    12. Acemoglu, Daron & Malekian, Azarakhsh & Ozdaglar, Asu, 2016. "Network security and contagion," Journal of Economic Theory, Elsevier, vol. 166(C), pages 536-585.
    13. Thomas Hasenzagl & Luis Perez, 2023. "The Micro-Aggregated Profit Share," Papers 2309.12945, arXiv.org, revised Nov 2023.
    14. Kumar, Ashish & Chakrabarti, Anindya S. & Chakraborti, Anirban & Nandi, Tushar, 2021. "Distress propagation on production networks: Coarse-graining and modularity of linkages," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 568(C).
    15. Emmanuel Dhyne & Ayumu Ken Kikkawa & Glenn Magerman, 2022. "Imperfect Competition in Firm-to-Firm Trade," Journal of the European Economic Association, European Economic Association, vol. 20(5), pages 1933-1970.
    16. Matthew O. Jackson & Brian W. Rogers & Yves Zenou, 2017. "The Economic Consequences of Social-Network Structure," Journal of Economic Literature, American Economic Association, vol. 55(1), pages 49-95, March.
    17. Nicole Branger & Patrick Konermann & Christoph Meinerding & Christian Schlag, 2021. "Equilibrium Asset Pricing in Directed Networks [Risk premia and term premia in general equilibrium]," Review of Finance, European Finance Association, vol. 25(3), pages 777-818.
    18. Xingxing Ye & Raphael Douady, 2018. "Systemic Risk Indicators Based on Nonlinear PolyModel," JRFM, MDPI, vol. 12(1), pages 1-24, December.
    19. Matthew O. Jackson, 2014. "Networks in the Understanding of Economic Behaviors," Journal of Economic Perspectives, American Economic Association, vol. 28(4), pages 3-22, Fall.
    20. Kumar, Sudarshan & Bansal, Avijit & Chakrabarti, Anindya S., 2019. "Ripples on financial networks," IIMA Working Papers WP 2019-10-01, Indian Institute of Management Ahmedabad, Research and Publication Department.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jmathe:v:10:y:2022:i:19:p:3660-:d:934654. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.