Can money be compared to energy? Empirical analysis of making money with the E = mc2 logic

Yıl 2022, Cilt: 8 Sayı: 1, 51 - 62, 31.01.2022

Rıdvan Karacan İsmail Barış

https://doi.org/10.24289/ijsser.1032393

Öz

In this study, the E = mc² principle that energy can be derived from mass and energy as itself was adapted for money. In the study, it was meant to provide a natural dimension to not using money other than the intent of exchange and the necessity of earning money by producing. To this end, the effect of foreign direct investments that are representing production and portfolio investments' effects on economic growth as representing monetary activities. The findings showed that both in the long and short term, there is a positive and significant relationship between FDI and economic growth. No such relationship has been found for portfolio investments. This result coincides with the E = mc² relationship.

Anahtar Kelimeler

Money, Energy, E=mc2, Economic Growth, ARDL Bounadry Test

Kaynakça

• Acquah, A. M. & Ibrahim, M. (2019). Foreign direct investment, economic growth and financial sector development in Africa. Journal of Sustainable Finance & Investment, 10(4), 315-334. doi: 10.1080/20430795.2019.1683504.
• Aizenman, J., Jinjarak, Y. & Park, D. (2013). Capital Flows and Economic Growth in the Era of Financial Integration and Crisis, 1990–2010. Open Econ Review, 24, 371–396. https://doi.org/10.1007/s11079-012-9247-3.
• Akel, V. & Gazel, S. (2014). The Relationship Between Foreign Exchange Rates and Bust Industry Index: A Successor Boundary Test Approach. Erciyes University Faculty of Economics and Administrative Sciences Journal, 44, 23-41.
• Aktan, C. C. (2010). Monetarism and Rational Expectations Theory. Journal of Economic Sciences. 2(1), 168-187.
• Assefa, T. A. & Mollick, A. V. (2017). Financial Development and Economic Growth in Africa. Journal of African Business, 18(3), 320-339. doi: 10.1080/15228916.2017.1301162.
• Bahmani, O. M. & Raymond, C. W. NG (2002). LongRun Demand of Business and Economics. International Journal of Business and Economics,1(2), 147–155.
• Barradas, R. (2020). Does the financial system support economic growth in times of financialisation? Evidence for Portugal. International Review of Applied Economics, doi: 10.1080/02692171.2020.1782854.
• Bodanis, D. (2009). E=mc2: A Biography of the World's Most Famous Equation (illustrated ed.). Bloomsbury Publishing.
• Darrigol, O. (2005). The Genesis of the Theory of Relativity. S´eminaire Poincar´e, 1,1-122.
• Demir, E. and Bahar, O. (2021). The impact of tourism revenues on economic growth: Empirical analysis on Turkey. International Journal of Social Sciences and Education Research, 7(2), 162-172. doi: https://doi.org/10.24289/ijsser.699497.
• Dinç, D.T. & Gökmen, A. (2019). Foreign direct investment & its correlation to economics: The case of Brazil. Journal of Transnational Management, 24(4), 323-342, doi: 10.1080/15475778.2019.1664216.
• Edem, K. M.K. &Samuel, A. (2016). Capital Flows and Economic Growth in Ghana. Journal of African Business, 17, 291-307, doi: 10.1080/15228916.2016.1169784.
• Einstein, A. (1919, November 28). Time, Space, and Gravitation London Times. http://germanhistorydocs.ghi-dc.org/pdf/eng/EDU_Einstein_ENGLISH.pdf, Date of Access: 21.10.2021.
• Einstein, A. (1916). The Theory of Relativity. (Edt. Gülen Aktaş). 10th Edition (2012). Istanbul: Say Publications.
• Esen, E., Yıldırım, S. & Kostakoğlu, S.F. (2012). Testing the hypothesis for the Feldstein-Horioka Turkey Economy: ARDL Model Application. Eskişehir Osmangazi University Journal of Business Administration, 7(1), 251-267.
• Ezzeddine, S. & Hammami, S. (2019). The Effects of International Financial Integration on Economic Growth Case of Tunisia. J Knowl Econ, 10, 868–877, https://doi.org/10.1007/s13132-017-0498-5, Date of Access: 2.11.2021.
• Fisher, I. (1911). The Purchasing Power of Money, New York, MacMillan Ltd., 1963.
• Friedman, M. & Friedman, R. (1980). Free to Choose, New York, Harcourt Brace Jovanovich.
• Friedman, M. (1959). The Demand for Money: Some Theoretical and Empirical Results. Journal of Political Economy, 67, doi: 10.1086/258194.
• Friedman, M., (1956). Studies in the Quantitiy Theory of Money, Chicago, University of Chicago Press.
• Gök, A. (2013). Physics 1 Lecture Note. Ankara: Ministry of National Education Open Education Schools.
• Güran, Y. (2011). Matter and Energy- Can they Transform into Each Other? What Does the E = mc2 Equation Tell? http://www.yalcinguran.com/2011/12/madde-ile-enerji-birbirine-donusebilir-mi%E2%80%A6-e-mc2-denklemi-neyi-anlatmaktadir/, Date of Access: 12.11.2021.
• Hayat, A. (2019). Foreign direct investments, institutional quality, and economic growth. The Journal of International Trade & Economic Development, 28(5), 561-579. doi: 10.1080/09638199.2018.1564064.
• Hicks, J. R. (1937). Mr. Keynes and the Classics; A Suggested Interpretation, Econometrica, 5(2),147-159.
• Infeld, L. (1950). Albert Einstein, His Work and Its Influence on Our World. New York: Charles Scribners's Sons.
• Keyder, N. (1993). Money, Theory, Policy, Practice. Ankara: Bizim Büro Printing house.
• Keynes, J. M. (1936). The General Theory of Employment, Interest and Money. London: Mc Millan.
• Keynes, J. M. (1973). Alternative Theories of the rate of Interest. Economic Journal, 241-252.
• Keynes, J. M. (1980). Employment Interest and Money General Theory. (Edt: Asım Baltacıgil), Istanbul: Minnetoğlu Publications, 168-217.
• Lee, C.C. & Chang, C.P. (2009). FDI, Financial Development, and Economic Growth: International Evidence. Journal of Applied Economics, 12(2), 249-271, doi: 10.1016/S1514-0326(09)60015-5.
• Małgorzata I.-D., Bongini, P., Smaga, P. & Witkowski, B. (2019). The role of banks in CESEE countries: exploring non-standard determinants of economic growth. Post-Communist Economies, 31(3), 349-382, doi: 10.1080/14631377.2018.1505694.
• Malik, S. S. & Iftikhar, M. (2019). The dynamic impact of foreign portfolio investment on stock prices in Pakistan. Transnational Corporations Review, 11(2), 166-178, doi: 10.1080/19186444.2019.1616508.
• Mehic, E., Sabina S. &Vesna, B.H. (2013). The Impact of FDI on Economic Growth: Some Evidence from Southeast Europe. Emerging Markets Finance and Trade, 49(1), 5-20, doi: 10.2753/REE1540-496X4901S101.
• Ming-R. Z. & Chang, C.H. (2010). Empirical analysis on the effect of foreign direct investment on the economic growth of Guangdong province. Journal of Information and Optimization Sciences, 31(3), 637-646, doi: 10.1080/02522667.2010.10699985.
• Noemi L.O. (2013). Financialization and Economic Growth in Developing Countries. International Journal of Political Economy, 42(4), 108-127, doi: 10.2753/IJP0891-1916420406.
• Perron, P. (1989). The Great Crash, the Oil Price Shock and the Unit Root Hypothesis. Econometrica, 57, 1361-1401.
• Planck, M. (1927). Treatise on thermodynamics. Third English edition, translated from the seventh German edition by Dr. A. Ogg. Journal of the Society of Chemical Industry, 46(18), 401-432.
• Ramirez, M. D. (2010). Is Foreign Direct Investment Productive in the Latin America Case? A Panel Co-integration Analysis, 1980–2002. The International Trade Journal, 25(1), 35-73, doi: 10.1080/08853908.2011.532041.
• Rankine, W. J. M. (1853). On the General Law of the Transformation of Energy. Proceedings of the Philosophical Society of Glasgow, 3(5), 276-280.
• Samuel, A.& Edem, K. M. K. (2018). Capital flows and economic growth revisited: evidence from five Sub-Saharan African countries. International Review of Applied Economics, 32(5), 620-640, doi: 10.1080/02692171.2017.1355357.
• Sardoni, C. (1991). Marx and Keynes: the critique of Say’s Law, G.A. Caravale (ed.). Marx and Modern Economic Analysis, The Future of Capitalism and the History of Thought, Aldershot, Edward Elgar, 2, 219 – 239.
• Sawyer, M. (2017). The processes of financialisation and economic performance, Economic and Political Studies, 5(1), 5-20, doi: 10.1080/20954816.2016.1274523.
• Serway, R.A. & Beichner, R.J. (2011). Physics for Science and Engineering-3, (Trans. ed.: Kemal Çolakoğlu). Ankara: Palme Publishing.
• Sin-Yu, H. & Iyke, B. N. (2020). The Determinants of Economic Growth in Ghana: New Empirical Evidence. Global Business Review, 21(3), 626-644.
• Smith, A. (1909). An Inquiry into the Nature and Causes of the Wealth of Nations. C. J. Bullock (Ed.), The Harvard Classics,10, New York: P.F. Collier & Son Company.
• Sudin, H. & Norafifah, A. (2000). The Effects Of Conventional Interest Rates And Rate Of Profıt On Funds Deposited With Islamic Banking System In Malaysia. International Journal of Islamic Financial Services, 1(4), 3-9.
• Syed, M. H., Timo, K., Danielle, X. & Khan, A. H. (2015). What Drives Stock Market Growth? A Case of a Volatile Emerging Economy. Emerging Markets Finance and Trade, 51(1), 209-223, doi: 10.1080/1540496X.2015.1011533.
• Ünsal, E. (2013). Makro Economy, Ankara: Imaj Publishing.
• Varınca, K. B. & Gönüllü, M. T. (2006). Solar Energy Potential and Potential Use of this Degree in Turkey, Method and A Survey on Prevalence. UGHEK’2006: I. National Solar and Hydrogen Energy Congress, ESOGÜ, Eskişehir, 270-275.
• Vita, G. & Kyaw, K. S. (2009). Growth effects of FDI and portfolio investment flows to developing countries: a disaggregated analysis by income levels. Applied Economics Letters, 16(3), 277-283, doi: 10.1080/13504850601018437.
• Wang, M. (2009). Manufacturing FDI and economic growth: evidence from Asian economies. Applied Economics, 41(8), 991-1002, doi: 10.1080/00036840601019059.
• Wicksell, K. (1962). Interest And Prices Geldzins und Guterpreise A Study Of The Causes Regulating The Value Of Money. Translated by R.F. Kahn, Newyork: Printed in The United States Of America By Sentry Press.
• Yazdi, S. K., Khadijeh, H. S. & Mahshid, S. (2017). The relationship between tourism, foreign direct investment and economic growth: evidence from Iran. Current Issues in Tourism, 20(1), 15-26, doi: 10.1080/13683500.2015.1046820.