This study explores the complex relationship between innovation and income inequality in 29 Asian economies from 2013 to 2022, emphasizing the mediating role of the Golden Triangle—comprising the state, civil society, and the market system. The study highlights how imbalances in the Golden Triangle’s components can hinder the inclusive potential of innovation, exacerbating inequality. Using a Panel Smooth Transition Regression (PSTR) model, it captures the nonlinear dynamics of innovation’s impact on income distribution and identifies threshold effects driven by institutional imbalances. The study reveals that the impact of innovation on income inequality is highly dependent on the balance within the Golden Triangle—state, civil society, and the market. When this balance is maintained, innovation contributes to more equitable income distribution by fostering inclusive economic growth. However, when the Golden Triangle is imbalanced, innovation disproportionately benefits higher-income groups, widening income disparities. Specifically, excessive power imbalances reduce the income share of low-income groups and concentrate wealth among high-income groups. Power imbalances weaken the redistributive effects of innovation, reducing the income share of lower-income groups while concentrating wealth at the top. These results highlight the critical role of institutional frameworks in shaping the equity outcomes of innovation. The study offers valuable policy insights, emphasizing the need for balanced institutional structures to ensure that innovation promotes inclusive growth rather than deepening economic disparities in Asian economies.

JEL Classification: O33, D63, F63

This study examines two key challenges in services trade research: the reliability of trade data and the measurement of non-tariff barriers, particularly the Services Trade Restrictiveness Index (STRI). Using firm-level panel data from Türkiye with fixed effects, we show that international data limitations significantly affect empirical results and that the explanatory power of the gravity model declines with more detailed microdata. We also find that the STRI’s link to trade flows is weaker and more sector-specific than assumed, questioning its methodological adequacy. Additionally, ad valorem equivalent (AVE) rates are estimated, revealing moderate barriers for Türkiye’s exports but much higher protection in imports, notably in technical services and transport. The findings highlight the need for sector-specific liberalization and call for next-generation STRI indices that are dynamic, firm-responsive, and modular by regulatory dimension. We advocate for cautious interpretation of STRI-based estimates and encourage the use of microdata across countries to improve services trade analysis and policy design.

JEL Classification: F13, F14, C23

Corporate ethics and corruption have garnered academic attention in recent decades. This study aims to gain insight into the relationship between ethical commitment and corruption and examine the moderating effect of Shariah compliance on this relationship. This study used 453 Malaysian companies from 2012 to 2021. The results indicate that a strong ethical commitment helps prevent management and employees from engaging in unethical behaviors that can lead to corruption within the company. However, the effect of ethical commitment on reducing corruption remains consistent, irrespective of a company’s Shariah-compliant status. For the separating samples based on the pre- and post-Malaysian Code of Corporate Governance (MCCG) 2017, the result shows no differences in the relationship between ethical commitment and corruption. However, Shariah compliance companies were found to reduce corruption in the post-MCCG 2017 period. This implies that improving the corporate governance structure seems to better influence corruption levels in Shariah compliance companies. This study contributes to the growing literature on corporate ethics and corruption by empirically examining the role of ethical commitment in mitigating corruption within the context of Malaysian companies. It provides novel evidence on how Shariah compliance influences this relationship, particularly in light of recent regulatory changes brought about by the Malaysian Code of Corporate Governance (MCCG) 2017.

JEL Classification: D73, G38, M14, K42

This study explores the role of regional trade agreements (RTAs) in mitigating the negative effects of uncertainty on trade, focusing on their depth and differential impacts on global value chain (GVC) and traditional trade. By employing an augmented gravity model with data from 70 countries spanning 1995 to 2020, the analysis reveals that deep RTAs, incorporating WTO-plus and WTO-extra provisions beyond tariff reductions, significantly alleviate the negative effects of uncertainty on both GVC and traditional exports. In contrast, shallow RTAs do not provide such mitigation. This study further highlights the resilience of GVC trade to uncertainty, driven by relationship-specific investments and long-term partnerships, while also recognizing its vulnerability to cumulative trade costs. Deep RTAs demonstrate more pronounced and persistent uncertainty-mitigation effects for GVC trade compared to traditional trade. Furthermore, we also find that WTO-extra provisions exert a more pronounced impact on both GVC and traditional exports. These findings underscore the critical importance of deep RTAs in fostering economic resilience and sustaining global supply chains amidst increasing global uncertainties, offering valuable policy implications for the design of trade agreements.

JEL Classification: F13, F14, F15