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Article
Publication date: 13 October 2023

Martin David Owens

Wars, and violent conflicts generally, can generate significant institutional dynamics and new legitimacy pressures for multinational enterprises (MNEs). The purpose of this paper…

Abstract

Purpose

Wars, and violent conflicts generally, can generate significant institutional dynamics and new legitimacy pressures for multinational enterprises (MNEs). The purpose of this paper is to understand the nature or source of institutional pressures facing MNEs in war and to examine how MNEs respond and navigate these institutional pressures.

Design/methodology/approach

This is a conceptual paper.

Findings

Through the theoretical lens of institutional theory and drawing on insights from the devastating Russian–Ukrainian war in Europe, the study provides a framework that explains the nature of institutional pressures impacting MNEs in a major war conflict and how MNEs respond to these pressures. Central to the framework is the impact of formal and informal institutions on MNEs during war. As a result of regulatory and social pressures, MNEs have to make important strategic decisions either to protect their legitimacy or to defend their economic objectives against institutional demands.

Originality/value

As the paper situates the pressures of war for MNEs in a formal and informal institutional context, this offers a new approach to understanding the costs and pressures of war on MNEs.

Details

Multinational Business Review, vol. 31 no. 4
Type: Research Article
ISSN: 1525-383X

Keywords

Article
Publication date: 9 February 2024

Rizky Yudaruddin and Dadang Lesmana

This study aims to investigate the market reaction in the real estate market to the announcement of Russia’s invasion of Ukraine.

Abstract

Purpose

This study aims to investigate the market reaction in the real estate market to the announcement of Russia’s invasion of Ukraine.

Design/methodology/approach

This study uses the event study method to assess the market reaction to the announcement that Russia is invading Ukraine. The sample in this study comprises 2,325 companies in the real estate market. We also conduct a cross-sectional analysis to determine the influence of the North Atlantic Treaty Organization (NATO) members and company characteristics on market reactions during the invasion.

Findings

The global market reacts significantly negative toward Russia’s invasion of Ukraine. This indicates that the war poses a high geopolitical risk that prompts financial markets down. The authors also demonstrate that emerging and frontier markets react significantly negative to the invasion before and after its announcement. Meanwhile, developed markets tend to react only before the invasion is announced. Furthermore, we find that the NATO members react more strongly than other markets.

Social implications

This result implies that war prompts investors to flee from the stock exchange, while the deeper the country’s involvement, the more investors worry about the risks.

Originality/value

This study is the first to discuss the market reaction to the Russian invasion of Ukrainian, specifically in the real estate market.

Details

Journal of European Real Estate Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1753-9269

Keywords

Article
Publication date: 21 November 2023

António Miguel Martins and Susana Cró

This paper investigates the short-term market impact of the beginning of the military conflict between Russia and Ukraine (February 24, 2022) on a set of airline stocks listed.

Abstract

Purpose

This paper investigates the short-term market impact of the beginning of the military conflict between Russia and Ukraine (February 24, 2022) on a set of airline stocks listed.

Design/methodology/approach

This study uses an event study methodology, cross-section analyses and interaction effects to study the effect of the war on airline stock prices and firm-specific characteristics that explain the cumulative abnormal return.

Findings

The authors observe a negative and statistically significant stock price reaction at and around the beginning of the military conflict between Russia and Ukraine, for 74 listed airlines. These results are consistent with investment portfolio rebalancing and asset pricing perspective. Moreover, this study's results show a higher negative stock market reaction for airlines based in Europe. Empirical evidence suggests the existence of a “proximity penalty” for European companies. Finally, this study's results provide insights into which airline-specific characteristics emerge as value drivers. Larger, well-capitalized (high liquidity and low debt) and profitable airlines firms with less institutional ownership have superior stock market returns and show more able to handle with the losses resulting from the war.

Originality/value

This paper fills a gap in the literature about the impact of the Russia–Ukraine war on the airline industry.

Details

Journal of Economic Studies, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0144-3585

Keywords

Article
Publication date: 4 April 2023

Prince Kumar Maurya, Rohit Bansal and Anand Kumar Mishra

This study investigates how the conflict between Russia and Ukraine impacts global inflation.

2181

Abstract

Purpose

This study investigates how the conflict between Russia and Ukraine impacts global inflation.

Design/methodology/approach

The study uses monthly consumer price index (CPI) data from 60 countries for 30 months, from January 2020 to June 2022. An event study methodology has been employed to check abnormal variation in the CPI, after classifying country-specific monthly data into nine groups.

Findings

The outcome revealed that Russia's full-scale invasion of Ukraine triggered inflation globally. However, the severity of inflation in the sample countries is determined by their geographical proximity and trading activity with the countries in conflict. A significant rise in inflation was observed among major European economies during the invasion. As the war continues, the increase in the price of essential commodities is evident worldwide.

Originality/value

The war literature till now has concentrated on stock markets, energy markets, exchange rates and precious metals. Since no previous research has attempted to quantify the abnormal effect of the war on domestic and global inflation, the current study will shed much-needed light on the subject.

Details

Journal of Economic Studies, vol. 50 no. 8
Type: Research Article
ISSN: 0144-3585

Keywords

Book part
Publication date: 22 January 2024

Mehmet Yavuz Çetinkaya, Yurdanur Yumuk and Halyna Kushniruk

Diaspora tourism primarily refers to various population groups, including migrants, foreign workers, political refugees, ethnic and religious minorities and overseas communities…

Abstract

Diaspora tourism primarily refers to various population groups, including migrants, foreign workers, political refugees, ethnic and religious minorities and overseas communities living away from their ancestral homeland for various reasons. Throughout history, people have been forced to leave their original homeland due to various factors ranging from economic crises to natural and human-made tragedies, including war. The 24 February 2022 unjustified and unproved Russia's war of aggression against Ukraine, which started on the heels of the two-year COVID-19 pandemic, has resulted in massive and terrible consequences for many domains of political, economic and social life. The Russian invasion of Ukraine has generated the largest historical migration flows at a scale unforeseen in Europe since World War II. Since Russia invaded Ukraine, at least 12 million people have been displaced from their homes, according to the United Nations. The unprecedented influx of the Ukrainian people raises concerns about future developments, issues and challenges associated with Ukrainians' presence in other countries, particularly neighbouring ones. Therefore, this chapter analyses the possibility of diaspora tourism for Ukrainians shortly by utilising a critical approach when the situation stabilises in Ukraine. To begin with, this chapter first explains diaspora tourism with its definition and characteristics. Furthermore, it reviews the literature on the Russia–Ukraine war and its impact on Ukrainian tourism. In conclusion, it discusses the new Ukrainian diaspora wave soon.

Details

Future Tourism Trends Volume 1
Type: Book
ISBN: 978-1-83753-245-2

Keywords

Article
Publication date: 10 January 2024

Li Dai and Yongsun Paik

Conventional wisdom suggests that war in the host country makes it unattractive for foreign firms to invest. To see if this is true for US firms on the aggregate, this paper aims…

Abstract

Purpose

Conventional wisdom suggests that war in the host country makes it unattractive for foreign firms to invest. To see if this is true for US firms on the aggregate, this paper aims to examine the veracity of a “permanent war economy” hypothesis, that foreign direct investment (FDI) may, in fact, increase in the host country not despite, but because of, war, i.e. one that lends credence to the idea that, in the USA, “defense [has] become one of constant preparation for future wars and foreign interventions rather than an exercise in response to one-off threats.”

Design/methodology/approach

The authors test the hypotheses using Generalized Method of Moments estimation, with Heckman Selection, on US FDI data from the Bureau of Economic Analysis and war data from the Correlates of War2 Project, the Uppsala Conflict Data Program/International Peace Research Institute data set, the International Crisis Behavior Project and the Center for Systemic Peace Major Episodes of Political Violence data set. The final sample consists of 351 country-year observations in 55 host countries from 1982 to 2006.

Findings

The findings indicate that overall US FDI in a host country in a given year decreases if the host country is engaged in wars with multiple countries and if the US Government is involved in the war. Most notably, the results show that US involvement in multiple host country wars is actually correlated with increased US FDI into the host country, providing empirical support for the “permanent war economy” hypothesis.

Originality/value

While other studies have focused on war and FDI, the authors have sought to show the impact of the involvement of arguably the most influential country, i.e. the USA, in the sovereign matters of a focal host country. By studying FDI from the USA as a function of US involvement in wars overseas, over the years with the greatest use of private military companies by the USA and the largest portion of global FDI accounted for by the USA, this work motivates a research agenda on home-host-"other” relations in the context of war and FDI, with the “other” being the supranational “elephant in the room.”

Details

Multinational Business Review, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1525-383X

Keywords

Article
Publication date: 6 November 2023

Rizky Yudaruddin and Dadang Lesmana

This study aims to investigate the market reaction to the Russian invasion of Ukraine, specifically in the banking sector.

Abstract

Purpose

This study aims to investigate the market reaction to the Russian invasion of Ukraine, specifically in the banking sector.

Design/methodology/approach

The research uses an event study and cross-sectional analysis, with market reaction measured by cumulative abnormal return (CAR). The sample comprised 1,126 banks.

Findings

The results show that the market reacted negatively to the invasion both before and after its announcement. Developed and emerging markets saw a negative impact from the invasion, while frontier markets experienced only a slight impact. The authors also find that the banking markets of North Atlantic Treaty Organization (NATO) members reacted significantly and negatively both before and after the invasion was announced. This demonstrates that the negative market reaction of NATO members was more impactful than that of other markets. Overall, this study shows that investors in the banking market are very sensitive to war.

Originality/value

This is the first study to provide international evidence, specifically on the banking sector's reaction during the Russian invasion of Ukraine.

Details

Journal of Economic Studies, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0144-3585

Keywords

Book part
Publication date: 22 January 2024

Hande Akyurt Kurnaz and Ayşen Acun Köksalanlar

In this chapter, we plan to describe the effects of war on tourism. Battlefield tourism was discussed within the effects of War on tourism. It is aimed to analyse the wars in…

Abstract

In this chapter, we plan to describe the effects of war on tourism. Battlefield tourism was discussed within the effects of War on tourism. It is aimed to analyse the wars in world history and the consequences of these wars. War is a modern security problem with long-term severe consequences engraved on society. Wars, on any ground, always impact people's memories and activities (Smith, 1998). Wars leave their mark on society and are among the never forgotten events in history (Aliağaoğlu, 2008). Some of these events end with victory, while others end sadly. Wars affect tourism both positively and negatively. This chapter is essential to identify the contribution of tourism in battlefields, a different type of tourism, to the countries. In the context of battlefield tourism, this chapter will present a framework. It attempts to explain battlefield tourism through case studies. Document review and case study methods will be used. It is assumed that this chapter will bring the battlefields to tourism.

Details

Future Tourism Trends Volume 1
Type: Book
ISBN: 978-1-83753-245-2

Keywords

Open Access
Article
Publication date: 7 November 2023

Adel Mohammed Ghanem, Khaled Nahar Alrwis, Sharafeldin Bakri Alaagib, Nageeb Aldawdahi, Ibrahim Al-Nashwan and Hossam Ghanem

This study aimed to measure the effects of the Russian–Ukrainian war on the value of imports and the food trade balance in Saudi Arabia.

Abstract

Purpose

This study aimed to measure the effects of the Russian–Ukrainian war on the value of imports and the food trade balance in Saudi Arabia.

Design/methodology/approach

Estimating the suggested model using econometric analysis for the years 1990–2021.

Findings

The amount of deficit increased in the food trade balance from 11.58 billion riyals in 1990 to 72.98 billion riyals in 2021. As for the increase in the index of food production by 10%, it leads to a decrease in the value of food imports for Saudi Arabia by 1.88%. Also, the value of the deficit in Saudi Arabia's food trade balance decreases by 5.24% as a result of a 10% rise in food exports to the country.

Originality/value

In light of the increase in the food price index to 145.8, the value of food imports and the deficit in the food trade balance exceed their counterparts in the current situation for the year 2021, at a rate of 37.1% and 44.5% for each respectively. In view of achieving huge financial surpluses as a result of the rise in oil prices, the Saudi Arabia is able to bear the high import bill and the amount of food trade balance deficit. Finally, the Russian–Ukrainian war leads to an increase in the cost of obtaining food commodities and their unavailability in the markets and thus affects the food security environment. Therefore, this study recommends the necessity of conducting more studies on the impact of the war on the food security of the Kingdom of Saudi Arabia.

Details

Arab Gulf Journal of Scientific Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1985-9899

Keywords

Article
Publication date: 22 March 2024

Amira Said and Chokri Ouerfelli

This paper aims to examine the dynamic conditional correlation (DCC) and hedging ratios between Dow Jones markets and oil, gold and bitcoin. Using daily data, including the…

Abstract

Purpose

This paper aims to examine the dynamic conditional correlation (DCC) and hedging ratios between Dow Jones markets and oil, gold and bitcoin. Using daily data, including the COVID-19 pandemic and the Russia–Ukraine war. We employ the DCC-generalized autoregressive conditional heteroskedasticity (GARCH) and asymmetric DCC (ADCC)-GARCH models.

Design/methodology/approach

DCC-GARCH and ADCC-GARCH models.

Findings

The most of DCCs among market pairs are positive during COVID-19 period, implying the existence of volatility spillovers (Contagion-effects). This implies the lack of additional economic gains of diversification. So, COVID-19 represents a systematic risk that resists diversification. However, during the Russia–Ukraine war the DCCs are negative for most pairs that include Oil and Gold, implying investors may benefit from portfolio-diversification. Our hedging analysis carries significant implications for investors seeking higher returns while hedging their Dow Jones portfolios: keeping their portfolios unhedged is better than hedging them. This is because Islamic stocks have the ability to mitigate risks.

Originality/value

Our paper may make a valuable contribution to the existing literature by examining the hedging of financial assets, including both conventional and Islamic assets, during periods of stability and crisis, such as the COVID-19 pandemic and the Russia–Ukraine war.

Details

The Journal of Risk Finance, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1526-5943

Keywords

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