Vol 5, No 1 (2017)
5-16
Abstract
Purpose - The purpose of this paper is to evaluate the current ability and prospects of the financial economy to respond to the newest challenges of the world economy with the special orientation to the emerging markets. Design/methodology/approach - The paper revisits the crisis as it is moving from an acute to a chronic phase. Meaning no new recession is thinkable top priority today is the euro zone crisis and China change. Findings - The euro zone is afflicted by three ills: a banking crisis, a sovereign-debt crisis and a growth crisis. Dealing with one often makes the others worse. Whatever the issue it is not simplifying but aggravating the behavior of the financial markets participants, viz. institutional investors. In case of China which economic role is expanding and plummeting simultaneously the expectations are even more controversial. Research Limitations/Implications - The author’s ability to decipher what went wrong in the financial economy could not translate fully into how to fix them. It easier to point out the flaws in a system than to correct them. Practical Implications - Some additional snags protrude out of the fact that main economic players have no trust in Chinese statistics. Originality/value - The paper talks broadly about a more balanced economy and adds insight into the present and the future of international financial markets.
17-31
Abstract
This is a paper based on cognitive psychology’s view of “curvilinear” optimism-pessimism and hence, with a flavor of behavioral macroeconomics. The substructure of a real overlapping-generations business cycle model is assumed to be underlined by the long-term character of the rational expectations of the big socioeconomic elite. This model is combined with the general-public’s view of the economy, which is assumed to be an extrapolation of the changing psychology of the community about the banking system. An exogenous shock will be propagated through this mass psychology. Policy-wise, the public sector is assumed away and the only purpose of the monetary authority is to secure the efficiency of intergenerational income distribution in a business environment with zero steady-state profit. Within this context, monetary policy is found to be in the spirit of the Old Chicago quantity theory from the viewpoint that is should be subject to a full-employment-wage standard in a gold-standard fashion. It is a countercyclical policy and not a version of the modern revival of inflation targeting, which is of the sort held responsible for the 1929 Crash.
32-41
Abstract
This paper is examined the price discovery and causality between spot and futures markets. Then, it forecasts spot prices using in NIFTY futures markets. Vector Error Correction Model (VECM), Impulse Response Function analysis and Variance Decomposition analysis are used to examine the price discovery process between spot and futures prices. This paper compares the forecast ability of futures prices on spot prices using Auto Regressive Integrated Moving Average (ARIMA) and VEC model. The results find that there exists a bi-directional causality between Nifty spot and futures markets and the spot markets disseminate new information stronger than futures prices. The forecast performance of VEC model is better than ARIMA model on post-sample periods. Because, VEC model incorporates the importance of taking into account the long-run relationship between the futures and the spot prices in forecasting future spot prices.
42-53
Abstract
We investigate the role of ownership distribution in determining the extraction rates of oil fields. We formulate an empirical equation where the percentage stake of the largest licensee and the percentage share held by the largest shareholder in the dominant company enter as dependent variables. Our sample consists of 44 oil fields in UK Continental Shelf over the period 1997-2001. We employ both fixed-effects and random-effects panel data models. The main results show that the share ownership of the largest licensee and the largest shareholder of its multinational company both have a positive and significant effect on the extraction rate. Moreover, we confirm the role of typical control variables: pay thickness has negative impact on the extraction rate, while remaining reserves are positively correlated with extraction rate. The sensitivity analysis shows that our results are robust to alterative sample selections and model specifications.
54-59
Abstract
This paper investigates the operating efficiency of Vietnam microfinance institutions (MFIs) in formal and informal sectors during the period from 2010 to 2015 through the operating self-sufficiency ratio, return on asset ratio and return on equity ratio. The results show that the ratios of formal MFIs were higher than these of informal MFIs. Then authors recommend that the informal MFIs in Vietnam should concentrate on operation management rather than transforming to formal MFIs by all means.
WHAT IMPACT DO CURRENCY EXCHANGE RATES HAVE ON THE M&A MARKET IN BRIC COUNTRIES?
60-69
Abstract
This study employs a stochastic gravity model to estimate efficiency performance of Vietnam’s trade with its main trading partners from 1995-2015. Trade efficiency is measured as the ratio of actual trade volume to the maximum likelihood. Moreover, it analyzes the effects of both natural and man-made trade barriers on trade efficiency. The empirical results suggest that the actual trade of Vietnam appears to be much smaller than a possible efficiency level and that there is large space for further progress. Export efficiency outweighs that of import. Vietnam’s AFTA membership has in general improved the trade efficiency, whereas tariffs and domestic devaluation downgrade it. Our findings lead to the recommendation that Vietnam should join more Free Trade Agreements (FATs) and eradicate the man-made barriers.
70-78
Abstract
This paper tries to examine how currency exchange rates are influencing the M&A market in BRIC countries. Therefore the amount of M&A deals is defined as the dependent variable. Next to the currency exchange rate further variables like GDP growth rate, Stock (size of stockmarket) and money and quasi money growth are included this model. This data was gathered by the World Bank and modifyed for the right purpose. We used yearly data from 1994-2014 by 4 different countries. But in consequence of the fact that not all the data is availiable since 1994 we were able to obtain 64 observations. By using panel data with fix effects and lags this paper tries to display the impact of currency exchange rates on the M&A market through 4 cross-sectional units in a time period of 14 years (without timelags). After estimating the model we came to the conclusion that currency exchanges have a negative effect which is mostly sicnificant in the second period.
ISSN 2308-944X (Print)
ISSN 2311-0279 (Online)
ISSN 2311-0279 (Online)