Pension assets as an investment in economic growth: The case of post-socialist countries and Ukraine

This paper examines the economic relationships between oil price volatility and socially-economic development of 14 Organization of the Petroleum Exporting Countries (OPEC) using the annual panel data for the period 1990–2014 obtained from the World Bank (WB) statistical data sets. Hausman specification test has been performed to choose the method of panel data analysis, and the results were in favor of fixed effects estimation. The main findings indicate the direct relationship between economic growth and oil price volatility. The research supports the hypothesis that an increase in crude oil prices is positively related to GDP, and a 10% increase in oil prices correlates with 0.6-4% GDP improvements. Structural changes in employment in favor of service sector are negatively correlated with GDP per capita. Changes in GDP structure in favor of oil rents on 10% lead to the shrinking of GDP on 1%. Life expectancy at birth, as an indirect indicator of health, positively influences the economic growth indicators and an improvement in life expectancy on one percentage leads on average to 1% growth in GDP and 0.5-1.33% growth in GDP per capita. Energy efficiency improvements are positive drivers of GDP values at OPEC, and our findings suggest that a 10% increase at GDP per unit of energy use leads to 3% increase of GDP itself. The study recommends investing in energy efficiency, human capital, and capital formation to guarantee long-run economic development and prosperity of OPEC counties.

Saudi Arabia is well known in the world for the holy places Makkah and Madinah. Hajjis and visitors come to perform hajj and Umrah every year in Makkah and Madinah from all around the world. Hajj and Umrah visits play a vital role in the inbound tourism of Saudi Arabia. The tourism revenue of Kingdom of Saudi Arabia is increasing absolutely but losing its contribution to the GDP proportionately. So, this paper tries to find out the economic activities of all components of tourism sector which are responsible for the negative trend. It also explains the relationships and variability of tourism revenues and expenditures with GDP and offers suggestions to enhance revenue of tourism sector. This study is based upon secondary data obtained from the website of SAMA (Saudi Arabian Monetary Authority) and General Authority for Statistics of Saudi Arabia. In tourism sector of Saudi Arabia, the increasing trend of expenditures of some economic activities is more than its revenue. The increasing trend of expenditures comparatively its revenues lowering contribution of tourism towards GDP. To improve the level of tourism revenue, government has to provide world class facilities and develop new tourist spots and allow the visitors to visit such places according to the Shariah and Kingdom rules. Government has to focus on developing passenger rail transport and other means of transport to connect all the tourist spots to provide easy conveyance, and on improving and developing tourism sector by helping the government and private organizations that are engaged directly or indirectly in providing services to the domestic and inbound tourists to assure more contribution to GDP.

The article analyzes the influence of inflation on economic growth and substantiates the main directions of increasing the effectiveness of the central bank's anti-inflation policy.
In order to determine the limit of inflation, the excess of which has a negative impact on the economic growth, the relationship is analyzed between the inflation rate and the real GDP growth rate on the basis of IMF statistics using the example of 158 countries. It was determined that in 2010–2017, in the global economy, the 6.0% inflation was the marginal value of the inflation rate, beyond which the economic growth rate declined or slowed down.
Given the inverse relationship between the inflation rate and the real GDP growth rates as well as empirical calculations for the period 1996–2017, the threshold for inflation rate for Ukraine at the level of 4.51% was determined based on empirical calculations for the 1996–2017 period. The results indicate that the National Bank of Ukraine set the inflation target above the level of the calculated threshold inflation.
It has also been established that the link between the rates of nominal GDP growth, as opposed to real GDP, and the inflation rate, is more direct and more tight. It is substantiated that to analyze such dependence it is better to use GDP deflator instead of CPI. The results indicate that deflation constrains economic growth much less than inflation.
In order to increase the effectiveness of the central bank’s pro-cyclical monetary policy aimed at supporting economic growth, the relationship between the rates of real GDP growth and the indicator characterizing the gap between the growth rates of M3 and inflation, which actually reflects the real money supply dynamics, is determined. The results obtained allowed to conclude that in 2009 and 2014-2017, the artificial “squeezing” of the money supply took place in Ukraine, resulting in a decrease in the level of the economy monetization by 22.0% in 2017 compared to 2013.
It has been proved that in order to minimize the negative impact of inflationary processes on economic growth, the policy of the National Bank of Ukraine should be aimed at eliminating the artificial squeezing of the money supply through a reasonable increase in the economy monetization and the implementation of an effective monetary policy.