Economic Notes最新文献

The high reliance on cash is a lifestyle for many people, and their low proficiency with smartphone usage acts as an inertial barrier to using digital financial services (DFS). Given low financial or digital literacy, online banking transactions have to be promoted and mediated by DFS agents. This study examines the role of digital platforms, intermediaries such as banks, mobile money agents, payment banks, post offices, and the government's increasing use of digital technologies. This usage of digital platforms is based on the trust relationship between the principals, who are owners of their bank accounts, and agents of DFS, who are intermediaries. A linear probabilistic model is employed to determine the determinants behind the low adoption of DFS between the necessity and nonnecessity groups. We observe that demand-side factors like education level, identity proof (documentation), and level of smartphone use proficiency increase the probability of a principal's involvement in a digital mode of payment. At the same time, supply-side factors like digital infrastructure and trust deficit due to unviable commission incentives to DFS agents decrease the principal's likelihood of using digital platforms.

This paper investigates the dynamic relationships between the volatility of Bitcoin and major Indian stock market indices. Employing a dynamic conditional correlation–generalized autoregressive conditional heteroskedasticity (DCC-GARCH) model, we explore how volatility shocks and information flow influence the correlations between these asset classes. Our findings reveal a key characteristic: volatility spillovers tend to be short-lived, indicated by a relatively low DCC-GARCH parameter (dcca1). This suggests that while a surge in volatility in one market might lead to a temporary increase in correlation with the other, this heightened correlation is unlikely to persist for extended periods. However, the model also highlights a high DCC-GARCH parameter (dccb1), signifying that the correlations themselves are responsive to new information. This implies that volatility linkages can adjust rapidly in response to market events or economic data releases. To enhance accessibility for a broad audience, we translate these findings into economic intuitions. We illustrate how the model can be interpreted through real-world examples, such as the impact of sudden policy changes in India or global market flash crashes. By understanding the short-lived nature of volatility spillovers and the responsiveness of correlations, investors in the Indian markets can make more informed decisions when considering the potential influence of Bitcoin's volatility while contributing to a deeper understanding of the dynamic interactions between cryptocurrency and traditional financial markets in the Indian context.

The literature has examined the relationship between financial inclusion and financial stability, but no studies have examined the relationship between financial inclusion and financial crisis. This study examines the effect of financial inclusion on financial crisis using data from 28 countries from 2006 to 2017. Three stylised facts were established based on real-world observation. One, the level of financial inclusion, in terms of number of bank depositors, decreases during domestic financial crisis. Two, the level of financial inclusion, in terms of ATM penetration, does not decrease during global and domestic financial crises. Three, the level of financial inclusion, in terms of number of bank branch, decreases during global and domestic financial crises and the contraction is stronger during a domestic financial crisis. Using the panel regression, logit and probit regression estimation methods, the empirical results show that low levels of financial inclusion, measured by fewer bank depositors and fewer bank branches, increase the likelihood that a financial crisis will occur. Low levels of financial inclusion, measured by fewer bank depositors, increase the likelihood that a financial crisis will occur in low financial-inclusion countries. In contrast, greater ATM penetration increases the likelihood that a financial crisis will occur in low financial-inclusion countries. The interaction analyses show that all indices of financial inclusion have a joint positive impact on financial crisis, implying that high levels of financial inclusion increases the likelihood that a financial crisis will occur.

This article proposes a methodology for measuring the macroprudential policy stance based on a forward-looking distance-to-tail metric derived from a large-scale semi-structural model. The model reflects the dynamics of 89 significant euro area banks and 19 euro area economies and two endogenous amplification mechanisms: the real economy banking sector and solvency funding feedback loops. Our results reveal a slight tightening of the macroprudential policy stance from 2017 to the end of 2019 that partially stemmed from adjusting macroprudential capital buffers and the phase-in of other systemwide banking sector policies reflecting macroprudential intentions. This trend is abruptly interrupted at the onset of the Covid-19 pandemic, when pronounced macrofinancial uncertainty led to a substantial increase in tail risks and reappears in 2021. Our assessment also reveals a high degree of co-movement in macroprudential stances across the euro area countries.

This paper studies the introduction of new temporary taxation on banks and its effects on banks' lending decisions. Focusing on a unique policy experiment in Slovenia in 2011, where the government imposed a 0.1% tax on banks' total assets, I find that the introduction of the tax resulted in a lower credit supply of loans to corporates. In particular, for each percentage point increase in the share of tax in the capital, banks charge, on average, 8 basis points higher lending rates and decrease their lending amount by 0.5%. The findings of this research carry strong policy implications for countries contemplating or having already implemented windfall or other temporary taxes on banks. The introduction of the tax might lead to a reduction in lending beyond what would be warranted from the standpoint of monetary or other policies.

Borrower-based macroprudential policies—such as caps on loan-to-value (LTV) ratios and debt-service-to-income (DSTI) limits—contain the build-up of systemic risk by reducing the probability and conditional impact of a crisis. While LTV/DSTI limits can increase inequality at introduction, they can dampen the increase in inequality under adverse macroeconomic conditions. The relative size of these opposing effects is an empirical question. We conduct counterfactual simulations under different macroeconomic and macroprudential policy scenarios using granular income and wealth data from the Households Finance and Consumption Survey for Ireland, Italy, Netherlands and Portugal. Simulation results show that borrower-based measures are associated with a moderate increase in wealth inequality, while the impact on income inequality is negligible.

In this study, we examine the influence of a preopening call market (CM) session on the subsequent continuous double auction (CDA) trading phase within a combined market structure (CMDA). We propose that the introduction of a CM phase before the CDA could potentially mitigate price volatility during the CDA by facilitating the disclosure of agents' private information through the preopening pricing phase. Our findings reveal a positive relationship between the preopening price and the prices traded during the subsequent phase, alongside a decreased deviation of prices from their fundamental value when high-quality information is available. These results suggest that a well-defined preopening phase has the potential to improve market efficiency.

Longstanding evidence in Middle East and North Africa (MENA) countries shows a high prevalence of unemployment and informality among a large fraction of population, and at the same time gender disparities in labour force participation and occupational mobility. Why is there such persistent labour-market segmentation? What is the impact and potential of various formalisation policies? An overview of the informal economy across three middle-income MENA countries (Egypt, Jordan and Tunisia) is provided with respect to taxonomy, coverage and drivers. Transition matrices and multinomial logistic regressions are applied to longitudinal microdata from Labour-Market Panel Surveys, focusing on workers' occupational mobility in relation to their previous status, age cohort, gender and other demographics. Persistent segmentation and low occupational mobility in all countries suggest that informal employment is not driven by choice on the labour supply side but by structural constraints on the demand side. Existing formalisation policies based on distinct stick and carrot strategies, and targeting of existing businesses and workers achieve rather modest impacts. One recommendation to supplement policies for decent jobs creation is to promote social and solidarity enterprises and extend microfinance to informal enterprises.

Turkey is one of the highest donors in the world, who also receives substantial amount of aids from various entities and countries. This paper aims to investigate the on going nexus between economic growth (EG) and foreign aid (AID) in Turkey; utilizing yearly data between 1960 and 2022 by employing wavelet analysis tools: namely the power spectrum, wavelet coherence, wavelet cohesion and Continuous Wavelet Transform (CWT) causality approach, which provides information of both long-run and short-run linkages for separate subperiods of time and frequencies. Our results reveal that; (a) the result of the power spectrum indicates that at different frequency and period, there is evidence of significant variation in EG and AID; (b) the outcome of the wavelet coherence confirms that there is comovement at varying frequencies and varying periods between EG and AID, with AID leading; (c) the outcome of the wavelet cohesion shows a positive/negative connection in the short and medium term, but a negative connection in the long term; (d) the result of the CWT causality approach confirmed the ‘feedback hypothesis’ at the aggregate level, in-phase and out-phase condition. As a result, policymakers should be more effective in supporting EG at high frequencies and only under the rule of the economic cycle.