Macroeconomics Commons^™

Recession Emerges As The Most Like Scenario, Eric Thompson

Business in Nebraska

The U.S. economy faces the prospect of a second recession as the Federal Reserve Bank continues to raise interest rates to confront inflationary forces. These forces include elevated asset prices and a wage-price spiral. Further interest rate increases are likely given a challenging environment to reduce inflation. Challenges include limited migration and a slow-growing labor force, trade restrictions, regulatory restrictions that limit energy production and raise the minimum wage as well as excessive federal government spending. Federal spending through the CARES Act, Coronavirus Supplemental Appropriations Act, American Rescue Plan, and Infrastructure Investment and Jobs Act continue to fuel excess demand. …

Growth Likely In A Time Of Uncertainty, Eric Thompson

Business in Nebraska

The U.S. economy continues to recover from the recession which occurred during March and April of 2020. Demand has been strong for both goods and services. At the same time, supply constraints are a concern in the economy, contributing to both higher prices and in some cases lost production within industries. Supply constraints are evident in both inputs (supplies) and labor. Labor force growth has been anemic in the last two years given slow population growth and a roughly 2 percent decline in the labor force participation rate. Looking forward, the baseline outlook is for the U.S. economic recovery to …

Sales Capture Patterns Among Nebraska Counties, Eric Thompson, Spencer Cook

Business in Nebraska

Sales capture, the share of local spending power that is captured by area businesses, is an important measure of economic activity. Greater sales capture, which is typically measured using data on local taxable sales, creates multiple benefits for the economy. 1. EMPLOYMENT: Greater sales capture means more employment in retailers, wholesalers, restaurants, hotels, and other businesses subject to sales tax. 2. TAX REVENUE: Taxable sales are an important part of the tax base of many city governments. 3. QUALITY OF LIFE: Retail and hospitality (restaurants, lodging, amusement, and recreation) businesses account for a significant share of taxable sales. These industries …

Producer Services: An Engine For High-Wage Job Growth, Spencer Cook, Eric Thompson

Business in Nebraska

Producer services providers are firms that sell services primarily to the business community rather than to individuals and households. Many producer services businesses are classified in the Professional, Scientific, and Technical Service (PSTS) industry. Accounting firms, consultants, and computer design services are prominent examples of PSTS businesses that are worth studying for three reasons:

1. SUPPORT OF OTHER INDUSTRIES: PSTS industries supply the broader business community, making them a critical segment of the economy.

2. RAPID HIGH WAGE JOB GROWTH: Many PSTS industries are rapidly growing and pay high wages. The producer services sector, in fact, is the principal source …

The Nebraska Economy Responds To The Covid-19 Pandemic, Eric Thompson

Business in Nebraska

The Nebraska economy will contract in 2020 but the rate of decline will not be as rapid as nationwide. The economic structure of Nebraska is more focused on production and transportation than the national economy and less focused on hard-hit industries such as hospitality, entertainment, automobile parts and assembly, and oil production. Nebraska also may benefit from a higher quality workforce, which is better able to adapt to changing economic conditions.

Employment will drop by 2.4% in Nebraska in 2020, much less than the national rate of decline. Employment will rebound by 2.0% in 2021 and 1.4% in 2022. With …

Consumers Support A Slowing Economy, Eric Thompson

Business in Nebraska

Nebraska will record moderate economic growth during the forecast period but will lag U.S. growth. Like the national economy, growth Nebraska’s goods producing sector will struggle. Farm incomes will be flat from 2020 to 2022 after improving this year. Manufacturing employment also is expected to drop. However, most other sectors will expand, including services, finance and construction. Projected growth rates for 2020 to 2022 are presented in Table 1.

Employment will grow by 0.6% to 0.8% per year, below the national rate. Non-farm income will grow between 3.7% and 3.8% each year. This growth readily exceeds inflation and population growth, …

Economic Perspectives Of Indigenous Knowledge Systems, Technology Transfer And Rural Water Use In Darfur, Issam A.W. Mohamed Professor

Professor Issam A.W. Mohamed

Civil strife, human sufferings are the signs pronounced by international media. There are political ramifications of the Darfur crisis, however, there are also the problems of water availability and methods of utilization. The current paper analyzes field data survey collected from the town of Kutum, Northern Darfur where the civil crisis started. The focus is on studying methods and utilization efficiency in the area. It is concluded here that it is important to revise technological transfer to me integrated with the indigenous knowledge for better and sustainable water use in Kutum, Darfur.

Effects Of Multicollinearity On The Estimation Of Macroeconomic Variables: Using Data From Sudan, Professor Issam A.W. Mohamed

Professor Issam A.W. Mohamed

The problem of multicollinearity in the assessments of coefficients is well established. However, it is rarely researched in the estimations of macroeconomic variables and economic performance of developing countries. Predicatively, it has impacts on the estimations of coefficients that should be used in economic decisions, strategic planning and if researchers are more industrious estimations of monetary supplies and demands. All such parameters are very basic and essential in economic plannings and their applications should be done not only in research but in ground applications of the specialized authorities, e.g., Ministries of Finance, Central Banks, Pricing Units, etc. However, that is …

Macroeconomic Effects Of Foreign Currency Exchange Rates On Savings Attitudes In Sudan, Professor Issam A.W. Mohamed

Professor Issam A.W. Mohamed

The impacts of fluctuations of exchange rates of foreign hard currencies are well documented in economics literature. There are measures taken over by countries to absorb their impacts on income, employment and national economies ability to function and produce. However, distortions are observed in underdeveloped and developing countries. Sudan is among those where impacts of fluctuations in exchange rates versus national currencies are strongly observed and felt on its economy. In the past three decades they represented the highest effects on real money's value, had macroeconomic impacts, affect the prices of productive inputs, produced commodities and the economy's performance. The …

International Capital Mobility: Evidence From Panel Cointegration Tests, John Thornton, Olumuyiwa S. Adedeji

John Thornton

Panel cointegration techniques applied to pooled data for 50 developed and developing economies for the period 1970–2000 indicate that savings and investment are non-stationary and cointegrated, that there are marked differences in saving–retention ratios between different country groups, and that retention ratios have fallen.

Saving, Investment And Capital Mobility In African Countries, John Thornton, Olumuyiwa S. Adedeji

John Thornton

Recently developed panel co-integration techniques are applied to data for six African countries to test the Feldstein–Horioka approach to measuring capital mobility. The results suggest three conclusions: savings and investment in panel data are non-stationary series and they are co-integrated; capital was relatively mobile in the African countries during 1970–2000, with estimated savings–retention ratios of 0.73 (FMOLS), 0.45 (DOLS), 0.51 (DOLS with heterogeneity) and 0.39 (DOLS with cross-sectional dependence effects); and there was a marked drop in the savings–retention ratio from 1970–85 to 1986–2000. The results could be interpreted as indicating that capital mobility in African countries has increased, reflecting …