Effects of Economic Policy on Firm Performance in Developed and Developing Countries
- 1 Laboratory of Economic and Social Research and Study, Faculty of Economic Sciences, Marien Ngouabi University, Brazzaville, Republic of the Congo
Abstract
This paper analyzes the effects of economic policy on firm performance in developed and developing countries, using a sample of firms classified by turnover. The methodology refers to the estimation of the dynamic panel fixed effects model. The results show that the priority economic policy tools based on price, balance of payments and employment control do not influence firm performance. However, debt increases the performance of firms in Africa. In high-income countries and China, it is savings and exchange rate policies that have a positive effect on firm performance. It is recommended that policymakers in Africa adopt a debt policy based on borrowing in compliance with ceilings and concessional interest rates so as not to increase debt service and suffocate the government’s cash flow. In developed countries, the savings policy must be maintained at the same pace as the mobilization of savings to meet the needs of growth sectors. Exchange rate policy must be able to absorb shocks and always adapt to the market.
- Aeberhardt, R., Crusson, L., & Pommier, P. (2011). Les politiques d’accès à l’emploi en faveur des jeunes: Qualifier et accompagner. In France, Portrait Social—Edition 2011 (pp. 153-172).
- Allen, F., & Gale, D. (2003). Capital Adequacy Regulation: In Search of a Rationale. In R. Arnott, B. Greenwald, R. Kanbur, & B. Nalebuff (Eds.), Economics for an Imperfect World: Essays in Honor of Joseph Stiglitz, MIT Press.
- Arrègle, J. L., & Powell, T. C. (2009). Pour une approche plus équilibrée de la performance des firmes. Revue Française de Gestion, 196, 147-165. https://doi.org/10.3166/rfg.196.147-165
- Beck, T., & Laeven, L. (2006). Institution Building and Growth in Transition Economies. Journal of Economic Growth, 11, 157-186. https://doi.org/10.1007/s10887-006-9000-0
- Benjamin, N., & Aly Mbaye, A. (2012). Les entreprises informelles de l’Afrique de l’ouest francophone—Taille, productivité et institutions (248 p). Banque Mondiale.
- Blot, C., Creel, J., Hubert, P., & Labondance, F. (2017). Les effets redistributifs des politiques monétaires de la BCE. Revue d’Economie Financière, No. 128, 165-180. https://doi.org/10.3917/ecofi.128.0165
- Blundell, R., & Bond, S. (1998). Initial Conditions and Moment Restrictions in Dynamic Panel Data Models. Journal of Econometrics, 87, 115-143. https://doi.org/10.1016/S0304-4076(98)00009-8
- Bond, S. (2002). Dynamic Panel Data Models: A Guide to Micro Data Methods and Practice. Portuguese Economic Journal, 1, 141-162. https://doi.org/10.1007/s10258-002-0009-9
- Bouquin, H., & Kuszla, C. (2013). Le contrôle de gestion. PUF.
- Carré, D., & Levratto, N. (2009). Politique industrielle et PME: Nouvelle politique et nouveaux outils? Revue d’économie Industrielle, 126, 9-30. https://doi.org/10.4000/rei.3965
- Doucouré, F. B. (2016). Méthodes économétriques tome 2: Cours et exercices résolus avec les logiciels Eviews et Stata. Arima.
- Fernandes, A. M. (2008). Firm Productivity in Bangladesh Manufacturing Industry. World Development, 36, 1725-1744. https://doi.org/10.1016/j.worlddev.2008.01.001
- Fernandez-Villaverde, J., Guerron-Quintana, P., Kuester, K., & Rubio-Ramirez, J. (2011). Fiscal Volatility Shocks and Economic Activity. NBER Working Paper No. 17317. https://doi.org/10.3386/w17317
- Kaldor, N. (1971). Conflicts in National Economic Objectives. Economic Journal, 81, 1-16. https://doi.org/10.2307/2229754