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1 – 10 of over 120000Dmitry Shevchenko, Weili Zhao and Qiyang Guo
The purpose of this study is to probe into the influence mechanism of financial opening onto industrial restructuring from the prism of financial development and examine the role…
Abstract
Purpose
The purpose of this study is to probe into the influence mechanism of financial opening onto industrial restructuring from the prism of financial development and examine the role of the credit market, capital market and currency market in transmitting the impact of financial opening onto industrial restructuring in both developed countries and developing countries.
Design/methodology/approach
In the theoretical model, the indicator of financial opening was introduced in Cobb–Douglas production function formula. Using constant elasticity of substitution utility function, based on Engel’s law, the optimal industrial structure in the economy was concluded. For the empirical analysis, data was collected from 36 developed countries and 34 developing countries during the period 2000 to 2019. Multiple mediator models with bootstrap techniques were used to identify the linkage between financial opening, financial development and industrial restructuring.
Findings
First, there is a U-shaped relationship between financial opening and industrial restructuring. Second, financial development plays a mediating role in transmitting the effects of financial opening onto industrial restructuring mainly through the credit market at the global level. Third, developed countries are in a trend of “reindustrialization,” while developing countries show a trend of “premature deindustrialization.” Moreover, for developed countries, the capital market leads to reindustrialization, while the credit market and currency market contribute to deindustrialization. For developing countries, the capital market and credit market lead to deindustrialization, while the currency market contributes to industrialization.
Originality/value
Unlike most previous researches, this paper focuses on examining three-variable relationship between financial opening, financial development and domestic industrial restructuring. Against the backdrop of the pandemic, monetary policy shifts of developed economies have led to an increase in cross-border capital flows, which will lead to the increasing risks for international financial markets and the reallocation of the global value chain. It is of great significance to clarify the linkage between these three variables in the face of a volatile international financial environment.
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Potential loosening of restrictions of foreign investment in the financial sector.
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DOI: 10.1108/OXAN-DB225284
ISSN: 2633-304X
Keywords
Geographic
Topical
Aidan O’Connor, Francisco J. Santos-Arteaga and Madjid Tavana
The purpose of this paper is to propose a game-theoretical model for commercial bank foreign direct investment strategy, government policy and domestic banking industry…
Abstract
Purpose
The purpose of this paper is to propose a game-theoretical model for commercial bank foreign direct investment strategy, government policy and domestic banking industry interactions in emerging market economies and demonstrate the application of this strategy to the banking system. Government policy and domestic banking industry interactions in emerging market economies and demonstrate the application of this strategy to the banking system.
Design/methodology/approach
The paper develops a game-theoretical model to analyze the optimality of the limiting entry strategy followed by a given domestic institutional sector when considering the entry applications of foreign banks in the domestic financial system. The model analyzes the strategic options available to an emerging market country with a relatively underdeveloped banking system when deciding whether or not and to what extent allow for the entrance of better reputed and more technologically advanced foreign banks in its domestic financial system.
Findings
The paper shows that the progressive liberalization of entry restrictions would define the perfect Bayesian equilibria of the subsequent set of continuation games and the respective payoffs derived from this liberalization as the domestic economy integrates and competes within the global financial system.
Originality/value
Banks operating in the international financial market have incentives to invest directly in emerging market economies and governments have incentives in allowing foreign banks entry to their market. As banking systems in these economies are generally underdeveloped, opening the financial system to foreign competitors could lead to a decrease in the market share of local banks. Eventually foreign banks could control the banking system and could de facto control the money supply.
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The financial restructuring measures under the IMF programme since the financial crisis far exceeded those carried out during the last 10 years in their depth and coverage…
Abstract
The financial restructuring measures under the IMF programme since the financial crisis far exceeded those carried out during the last 10 years in their depth and coverage. Starting from the observation that the financial crisis of late 1991 occurred after the well publicised entry into the OECD, this paper focuses on the relationship between the liberalisation and opening‐up of the financial market and the unprecedented financial crisis in Korea. It deals with issues raised as the Korean financial regulatory system moved from a controlled system to a market oriented system, and it reviews the policy initiatives of financial regulation and liberation in the period between the early 1980s and late 1991. This paper shows the importance of a multi‐staged system of information production and monitoring of the economy in the transformation into a market‐oriented system, suggesting that this transformation can damage the economy if related policies do not enhance the power of financial supervision to monitor the moral hazard behaviour of financial institutions.
Financial reform and opening in China.
The objective of this paper is to provide a macroeconomic assessment of the impact of global financial integration over the economies that are undergoing financial integration.
Abstract
Purpose
The objective of this paper is to provide a macroeconomic assessment of the impact of global financial integration over the economies that are undergoing financial integration.
Design/methodology/approach
The paper focuses on several issues. It begins with examining the evidence whether financial globalization elevates growth performance of the integrating economy and supports it macroeconomic stability. It takes a nuanced view and divides the impact of financial integration into direct and indirect benefits. Second, it scrutinizes whether there are some threshold conditions, that is, in their presence and with their support, financial globalization underpins growth and stability of the capital importing economy and in their absence it cannot. Third, it delves into the oft‐cited allegation of financial globalization being a source of macroeconomic volatility and eventually financial crises. Fourth, as the evidence that emerged regarding ability of financial globalization to underpin growth was unambiguous. Policy mandarins' options are examined.
Findings
The paper finds that from a theoretical perspective, it is easy to state that integration of financial markets an potentially faster growth. Whether it happens in reality is a different matter.
Originality/value
The paper explores a new theme. While there are many relevant themes in financial globalization, the author has not seen any article on this theme and this paper may well be the first.
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Jean-Baptiste Gossé and Dominique Plihon
– This article aims to provide insight into the future of financial markets and regulation in order to define what would be the best strategy for Europe.
Abstract
Purpose
This article aims to provide insight into the future of financial markets and regulation in order to define what would be the best strategy for Europe.
Design/methodology/approach
First the authors define the potential changes in financial markets and then the tools available for the regulator to tame them. Finally, they build five scenarios according to the main evolutions observed on the financial markets and on the tools used by the regulator to modify these trends.
Findings
Among the five scenarios defined, two present highly unstable features since the regulator refuses to choose between financial opening and independently determining how to regulate finance in order to preserve financial stability. Three of them achieve financial stability. However, they are more or less efficient or feasible. In terms of market efficiency, the multi-polar scenario is the best and the fragmentation scenario is the worst, since gains of integration depend on the size of the new capital market. Regarding sovereignty of regulation, fragmentation is the best scenario and the multi-polar scenario is the worst, because it necessitates coordination at the global level which implies moving further away from respective national preferences. However, the more realistic option seems to be the regionalisation scenario: this level of coordination seems much more realistic than the global one; the market should be of sufficient size to enjoy substantial benefits of integration. Nevertheless, the “European government” might gradually increase the degree of financial integration outside Europe in line with the degree of cooperation with the rest of the world.
Originality/value
Foresight studies on financial markets and regulation are quite rare. This may be explained by the difficulty to forecast what will be their evolution in the coming decades, not least because finance is fundamentally unstable. This paper provides a framework to consider what could be the best strategy of regulators in such an unstable environment.
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Qiongwei Ye and Baojun Ma
Internet + and Electronic Business in China is a comprehensive resource that provides insight and analysis into E-commerce in China and how it has revolutionized and continues to…
Abstract
Internet + and Electronic Business in China is a comprehensive resource that provides insight and analysis into E-commerce in China and how it has revolutionized and continues to revolutionize business and society. Split into four distinct sections, the book first lays out the theoretical foundations and fundamental concepts of E-Business before moving on to look at internet+ innovation models and their applications in different industries such as agriculture, finance and commerce. The book then provides a comprehensive analysis of E-business platforms and their applications in China before finishing with four comprehensive case studies of major E-business projects, providing readers with successful examples of implementing E-Business entrepreneurship projects.
Internet + and Electronic Business in China is a comprehensive resource that provides insights and analysis into how E-commerce has revolutionized and continues to revolutionize business and society in China.
After the 2008 global financial crisis, the world has been through an improving economic integration. The scale of RMB cross-border transaction flows expands as well. Countries…
Abstract
After the 2008 global financial crisis, the world has been through an improving economic integration. The scale of RMB cross-border transaction flows expands as well. Countries around China are gradually accepting the RMB as a means of trading and investing. Nowadays, the phenomenon of RMB substitutes the currencies of neighboring countries has become more and more widespread. As a frontier region for China's opening up to the outside world, Hong Kong's financial market is highly transparent with perfect infrastructures. The completion of the Hong Kong offshore RMB market leads to a rise of the RMB stock in Hong Kong, so there is a clear phenomenon of RMB substituting Hong Kong dollars (HKDs) in Hong Kong. This paper studies the substitution effect of RMB and HKD from both theoretical and empirical aspects, and puts forward policy recommendations based on the research results.
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Young Seob Son, William T. Smith and Chong Soo Pyun
This study reveals how a Korean monetary transmission mechanism evolves in the tumultuous decade of the 1990s. We show that (i) contractionary monetary policy shocks have more…
Abstract
This study reveals how a Korean monetary transmission mechanism evolves in the tumultuous decade of the 1990s. We show that (i) contractionary monetary policy shocks have more explanatory power for the post‐crisis periods than for the pre‐crisis period; (ii) the effects on output from external shocks attributed to the oil price and the U.S. federal fund rates are mixed; (iii) there is little positive spillover effect from the U.S. to Korea through the trade channel; and (iv) there is a positive spillover effect from the international capital market channel.
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