Government failures and non-performing loans in European countries: a spatial approach
Purpose The purpose is to analyze the spatially varying impacts of corruption and public debt as % of GDP (proxies of government failures) on non-performing loans (NPLs) in European countries; comparing two periods: one prior to the crisis of 2007 and another one after that. The authors first modele...
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cremerald:10.1108/jes-01-2021-0010 2024-06-23T07:54:05+00:00 Government failures and non-performing loans in European countries: a spatial approach Ofria, Ferdinando Mucciardi, Massimo 2021 http://dx.doi.org/10.1108/jes-01-2021-0010 https://www.emerald.com/insight/content/doi/10.1108/JES-01-2021-0010/full/xml https://www.emerald.com/insight/content/doi/10.1108/JES-01-2021-0010/full/html en eng Emerald https://www.emerald.com/insight/site-policies Journal of Economic Studies volume 49, issue 5, page 876-887 ISSN 0144-3585 journal-article 2021 cremerald https://doi.org/10.1108/jes-01-2021-0010 2024-06-05T04:06:07Z Purpose The purpose is to analyze the spatially varying impacts of corruption and public debt as % of GDP (proxies of government failures) on non-performing loans (NPLs) in European countries; comparing two periods: one prior to the crisis of 2007 and another one after that. The authors first modeled the NPLs with an ordinary lest square (OLS) regression and found clear evidence of spatial instability in the distribution of the residuals. As a second step, the authors utilized the geographically weighted regression (GWR) to explore regional variations in the relationship between NPLs and the proxies of “Government failures”. Design/methodology/approach The authors first modeled the NPL with an OLS regression and found clear evidence of spatial instability in the distribution of the residuals. As a second step, the author utilized the Geographically Weighted Regression (GWR) (Fotheringham et al. , 2002) to explore regional variations in the relationship between NPLs and proxies of “Government failures” (corruption and public debt as % of GDP). Findings The results confirm that corruption and public debt as % of GDP, after the crisis of 2007, have affected significantly on NPLs of the EU countries and the following countries neighboring the EU: Switzerland, Iceland, Norway, Montenegro, and Turkey. Originality/value In a spatial prospective, unprecedented in the literature, this research focused on the impact of corruption and public debt as % of GDP on NPLs in European countries. The positive correlation, as expected, between public debt and NPLs highlights that fiscal problems in Eurozone countries have led to an important rise of problem loans. The impact of institutional corruption on NPLs reports that the higher the corruption, the higher is the level of NPLs. Article in Journal/Newspaper Iceland Emerald Norway Journal of Economic Studies ahead-of-print ahead-of-print |
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Purpose The purpose is to analyze the spatially varying impacts of corruption and public debt as % of GDP (proxies of government failures) on non-performing loans (NPLs) in European countries; comparing two periods: one prior to the crisis of 2007 and another one after that. The authors first modeled the NPLs with an ordinary lest square (OLS) regression and found clear evidence of spatial instability in the distribution of the residuals. As a second step, the authors utilized the geographically weighted regression (GWR) to explore regional variations in the relationship between NPLs and the proxies of “Government failures”. Design/methodology/approach The authors first modeled the NPL with an OLS regression and found clear evidence of spatial instability in the distribution of the residuals. As a second step, the author utilized the Geographically Weighted Regression (GWR) (Fotheringham et al. , 2002) to explore regional variations in the relationship between NPLs and proxies of “Government failures” (corruption and public debt as % of GDP). Findings The results confirm that corruption and public debt as % of GDP, after the crisis of 2007, have affected significantly on NPLs of the EU countries and the following countries neighboring the EU: Switzerland, Iceland, Norway, Montenegro, and Turkey. Originality/value In a spatial prospective, unprecedented in the literature, this research focused on the impact of corruption and public debt as % of GDP on NPLs in European countries. The positive correlation, as expected, between public debt and NPLs highlights that fiscal problems in Eurozone countries have led to an important rise of problem loans. The impact of institutional corruption on NPLs reports that the higher the corruption, the higher is the level of NPLs. |
format |
Article in Journal/Newspaper |
author |
Ofria, Ferdinando Mucciardi, Massimo |
spellingShingle |
Ofria, Ferdinando Mucciardi, Massimo Government failures and non-performing loans in European countries: a spatial approach |
author_facet |
Ofria, Ferdinando Mucciardi, Massimo |
author_sort |
Ofria, Ferdinando |
title |
Government failures and non-performing loans in European countries: a spatial approach |
title_short |
Government failures and non-performing loans in European countries: a spatial approach |
title_full |
Government failures and non-performing loans in European countries: a spatial approach |
title_fullStr |
Government failures and non-performing loans in European countries: a spatial approach |
title_full_unstemmed |
Government failures and non-performing loans in European countries: a spatial approach |
title_sort |
government failures and non-performing loans in european countries: a spatial approach |
publisher |
Emerald |
publishDate |
2021 |
url |
http://dx.doi.org/10.1108/jes-01-2021-0010 https://www.emerald.com/insight/content/doi/10.1108/JES-01-2021-0010/full/xml https://www.emerald.com/insight/content/doi/10.1108/JES-01-2021-0010/full/html |
geographic |
Norway |
geographic_facet |
Norway |
genre |
Iceland |
genre_facet |
Iceland |
op_source |
Journal of Economic Studies volume 49, issue 5, page 876-887 ISSN 0144-3585 |
op_rights |
https://www.emerald.com/insight/site-policies |
op_doi |
https://doi.org/10.1108/jes-01-2021-0010 |
container_title |
Journal of Economic Studies |
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ahead-of-print |
container_issue |
ahead-of-print |
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1802646041504251904 |