Pub Date : 2025-12-01Epub Date: 2025-10-25DOI: 10.1016/j.gfj.2025.101204
Matías Braun , Santiago Truffa , Ercos Valdivieso
Using a large sample of U.S. public firms, our study introduces a measure of misconduct exposure, based on the interconnected professional experiences of board members with directors from firms previously engaged in misconduct. We document that a firm's inclination towards corporate misbehavior is positively associated with its proximity, particularly through past professional board connections, to firms with similar misconduct histories. These peer effects are more pronounced when the connection involves influential board members, when the misconduct is less detectable, and when the misconducting neighboring firms receive lenient penalties. Our findings are robust to controlling for varying enforcement levels and are not fully explained by the endogenous nature of firm-director relationships. Moreover, these professional network effects are distinct from the influences of local and industry norms, interlocking directorates, and geographic proximity, for which we also provide evidence.
{"title":"Director networks and misconduct","authors":"Matías Braun , Santiago Truffa , Ercos Valdivieso","doi":"10.1016/j.gfj.2025.101204","DOIUrl":"10.1016/j.gfj.2025.101204","url":null,"abstract":"<div><div>Using a large sample of U.S. public firms, our study introduces a measure of misconduct exposure, based on the interconnected professional experiences of board members with directors from firms previously engaged in misconduct. We document that a firm's inclination towards corporate misbehavior is positively associated with its proximity, particularly through past professional board connections, to firms with similar misconduct histories. These peer effects are more pronounced when the connection involves influential board members, when the misconduct is less detectable, and when the misconducting neighboring firms receive lenient penalties. Our findings are robust to controlling for varying enforcement levels and are not fully explained by the endogenous nature of firm-director relationships. Moreover, these professional network effects are distinct from the influences of local and industry norms, interlocking directorates, and geographic proximity, for which we also provide evidence.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"68 ","pages":"Article 101204"},"PeriodicalIF":5.5,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145417009","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-01Epub Date: 2025-10-08DOI: 10.1016/j.gfj.2025.101200
Xiaoying Wu , Hyoung-Goo Kang , Doojin Ryu
This study examines how policy-driven green finance reform reshapes firm-banking relationships, using the implementation of China's Green Finance Pilot Zones (GFPZ) as a quasi-natural experiment. Employing loan announcement data from listed firms and a difference-in-differences approach, we measure the intensity of firm-banking relationships using repeated borrowing activity and find that the GFPZ policy significantly reduces it. The effect is more pronounced in regions with greater banking competition and financial development, and among firms that are more transparent or under stricter environmental scrutiny. By showing how sustainability-oriented policies transform financial relationships, this study provides new insights into the adaptation of firm-banking interactions under green development agendas.
{"title":"Green finance reform and reshaping firm-banking relationships: Evidence from China","authors":"Xiaoying Wu , Hyoung-Goo Kang , Doojin Ryu","doi":"10.1016/j.gfj.2025.101200","DOIUrl":"10.1016/j.gfj.2025.101200","url":null,"abstract":"<div><div>This study examines how policy-driven green finance reform reshapes firm-banking relationships, using the implementation of China's Green Finance Pilot Zones (GFPZ) as a quasi-natural experiment. Employing loan announcement data from listed firms and a difference-in-differences approach, we measure the intensity of firm-banking relationships using repeated borrowing activity and find that the GFPZ policy significantly reduces it. The effect is more pronounced in regions with greater banking competition and financial development, and among firms that are more transparent or under stricter environmental scrutiny. By showing how sustainability-oriented policies transform financial relationships, this study provides new insights into the adaptation of firm-banking interactions under green development agendas.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"68 ","pages":"Article 101200"},"PeriodicalIF":5.5,"publicationDate":"2025-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145417010","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-07-02DOI: 10.1016/j.gfj.2025.101150
Ficawoyi Donou-Adonsou
The efficiency of financial systems in fostering economic growth remains a critical concern, particularly in Sub-Saharan Africa, where financial markets and institutions exhibit structural weaknesses. Existing literature predominantly focuses on the dichotomy between bank-based and market-based financial systems, overlooking the relative contributions of different financial institutions. Using data from 22 Sub-Saharan African countries from 2006 to 2017, we examine the role of banks, stock markets, microfinance, credit unions and credit cooperatives, other deposit takers, and non-resident banks in enhancing economic efficiency. Employing the generalized method of moments, we find that deposit-taking institutions exert the most substantial impact, while investments in stock markets are twice as effective as bank loans in driving economic performance. Additionally, our results indicate that banking activities complement both stock markets and deposit-taking institutions, but we observe no significant relationship between stock markets and deposit takers. These findings challenge the conventional wisdom that distinguishes between market-based and bank-based financial systems as primary factors for economic growth. Instead, we argue that the composition and interaction of institutions within the financial system are more critical for fostering economic efficiency. This study provides valuable implications for policymakers and financial practitioners, emphasizing the need to focus on institutional dynamics rather than merely the structural type of financial system. By enhancing our understanding of these relationships, our findings contribute to the broader debate of financial development and economic performance in emerging markets.
{"title":"Financial structure and economic efficiency in Sub-Saharan Africa","authors":"Ficawoyi Donou-Adonsou","doi":"10.1016/j.gfj.2025.101150","DOIUrl":"10.1016/j.gfj.2025.101150","url":null,"abstract":"<div><div>The efficiency of financial systems in fostering economic growth remains a critical concern, particularly in Sub-Saharan Africa, where financial markets and institutions exhibit structural weaknesses. Existing literature predominantly focuses on the dichotomy between bank-based and market-based financial systems, overlooking the relative contributions of different financial institutions. Using data from 22 Sub-Saharan African countries from 2006 to 2017, we examine the role of banks, stock markets, microfinance, credit unions and credit cooperatives, other deposit takers, and non-resident banks in enhancing economic efficiency. Employing the generalized method of moments, we find that deposit-taking institutions exert the most substantial impact, while investments in stock markets are twice as effective as bank loans in driving economic performance. Additionally, our results indicate that banking activities complement both stock markets and deposit-taking institutions, but we observe no significant relationship between stock markets and deposit takers. These findings challenge the conventional wisdom that distinguishes between market-based and bank-based financial systems as primary factors for economic growth. Instead, we argue that the composition and interaction of institutions within the financial system are more critical for fostering economic efficiency. This study provides valuable implications for policymakers and financial practitioners, emphasizing the need to focus on institutional dynamics rather than merely the structural type of financial system. By enhancing our understanding of these relationships, our findings contribute to the broader debate of financial development and economic performance in emerging markets.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"67 ","pages":"Article 101150"},"PeriodicalIF":5.5,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144588588","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-07-05DOI: 10.1016/j.gfj.2025.101152
Karel Hrazdil , Yan Li , Thomas Scott
We investigate whether adopting a uniform set of accounting standards impacts stock price efficiency by introducing a novel empirical test imported from the finance literature. Using mandatory adoption of International Financial Reporting Standards (IFRS) as an exogenous shock to the accounting information disclosure environment and employing a difference-in-difference research design, we find that the extent to which stock prices deviate from their fundamental values decreases significantly following the adoption of IFRS. In cross-sectional tests, we further observe that the impact of IFRS adoption on stock price efficiency is more pronounced in countries with lower accounting quality prior to IFRS adoption and in those with substantial differences between their domestic Generally Accepted Accounting Principles (GAAP) and IFRS. Overall, our study contributes to the literature by empirically examining a fundamental aspect of the IFRS mission statement—whether IFRS adoption enhances financial market efficiency.
{"title":"Accounting disclosures and stock price efficiency: Evidence from mandatory IFRS adoption","authors":"Karel Hrazdil , Yan Li , Thomas Scott","doi":"10.1016/j.gfj.2025.101152","DOIUrl":"10.1016/j.gfj.2025.101152","url":null,"abstract":"<div><div>We investigate whether adopting a uniform set of accounting standards impacts stock price efficiency by introducing a novel empirical test imported from the finance literature. Using mandatory adoption of International Financial Reporting Standards (IFRS) as an exogenous shock to the accounting information disclosure environment and employing a difference-in-difference research design, we find that the extent to which stock prices deviate from their fundamental values decreases significantly following the adoption of IFRS. In cross-sectional tests, we further observe that the impact of IFRS adoption on stock price efficiency is more pronounced in countries with lower accounting quality prior to IFRS adoption and in those with substantial differences between their domestic Generally Accepted Accounting Principles (GAAP) and IFRS. Overall, our study contributes to the literature by empirically examining a fundamental aspect of the IFRS mission statement—whether IFRS adoption enhances financial market efficiency.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"67 ","pages":"Article 101152"},"PeriodicalIF":5.5,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144579768","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-08-08DOI: 10.1016/j.gfj.2025.101168
Jimmy A. Saravia , Silvia Saravia-Matus , Cristhian J. Cachope , Paula M. Almonacid
This study aims to test a corporate governance mechanism described by Jensen and Meckling in their classic theory of the agency costs of outside equity, focusing on Latin American companies characterized by controlling shareholders who own a large percentage of their firms' shares. Our findings align with the theory: Ownership concentration gives controlling shareholders significant influence over their firms, enabling them to reduce agency costs when selling shares or issuing new equity, as their interests align with those of outside shareholders. Higher market valuations and better investment performance evidence this. However, we also find that this influence allows controlling shareholders to act opportunistically when increasing their ownership stakes or during stock repurchases, as interests are not aligned, leading to adverse effects on firm performance. Thus, high ownership stakes provide controlling shareholders with influence, but whether this influence positively or negatively impacts performance depends on the specific context of equity transactions. This paper sheds new light on the ambivalent role of ownership concentration, offering insights relevant to improving monitoring and regulation in markets with weak institutions.
{"title":"Ownership concentration and equity transactions: The ambivalent role of controlling shareholders in firm performance in Latin American contexts","authors":"Jimmy A. Saravia , Silvia Saravia-Matus , Cristhian J. Cachope , Paula M. Almonacid","doi":"10.1016/j.gfj.2025.101168","DOIUrl":"10.1016/j.gfj.2025.101168","url":null,"abstract":"<div><div>This study aims to test a corporate governance mechanism described by Jensen and Meckling in their classic theory of the agency costs of outside equity, focusing on Latin American companies characterized by controlling shareholders who own a large percentage of their firms' shares. Our findings align with the theory: Ownership concentration gives controlling shareholders significant influence over their firms, enabling them to reduce agency costs when selling shares or issuing new equity, as their interests align with those of outside shareholders. Higher market valuations and better investment performance evidence this. However, we also find that this influence allows controlling shareholders to act opportunistically when increasing their ownership stakes or during stock repurchases, as interests are not aligned, leading to adverse effects on firm performance. Thus, high ownership stakes provide controlling shareholders with influence, but whether this influence positively or negatively impacts performance depends on the specific context of equity transactions. This paper sheds new light on the ambivalent role of ownership concentration, offering insights relevant to improving monitoring and regulation in markets with weak institutions.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"67 ","pages":"Article 101168"},"PeriodicalIF":5.5,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144852137","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-08-13DOI: 10.1016/j.gfj.2025.101165
Santiago Guerrero-Escobar , Gerardo Hernández-del-Valle , Marco Hernández-Vega
Many companies are adopting ambitious greenhouse gas (GHG) emission-reduction targets that align with the Paris Agreement, regarding broader climate strategies. Despite this trend, empirical evidence on the implications to the financial market remains limited. This paper examines how committing to and setting GHG targets affect stock returns and volatility, using a daily panel of publicly listed companies from January 2015 to October 2024. We employ an event study framework, supplemented by a generalized autoregressive conditional heteroskedasticity model with a novel trend component. Our findings show that neither committing to nor setting a GHG target has a statistically significant impact on stock returns. However, both actions are associated with reductions in stock price volatility in a few countries, like Australia, Japan, South Africa, Taiwan, and New Zealand. This suggests that market responses to climate commitments can vary across regional and policy contexts.
{"title":"The stock market effects of committing and setting GHG targets: evidence from the science-based targets initiative","authors":"Santiago Guerrero-Escobar , Gerardo Hernández-del-Valle , Marco Hernández-Vega","doi":"10.1016/j.gfj.2025.101165","DOIUrl":"10.1016/j.gfj.2025.101165","url":null,"abstract":"<div><div>Many companies are adopting ambitious greenhouse gas (GHG) emission-reduction targets that align with the Paris Agreement, regarding broader climate strategies. Despite this trend, empirical evidence on the implications to the financial market remains limited. This paper examines how committing to and setting GHG targets affect stock returns and volatility, using a daily panel of publicly listed companies from January 2015 to October 2024. We employ an event study framework, supplemented by a generalized autoregressive conditional heteroskedasticity model with a novel trend component. Our findings show that neither committing to nor setting a GHG target has a statistically significant impact on stock returns. However, both actions are associated with reductions in stock price volatility in a few countries, like Australia, Japan, South Africa, Taiwan, and New Zealand. This suggests that market responses to climate commitments can vary across regional and policy contexts.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"67 ","pages":"Article 101165"},"PeriodicalIF":5.5,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144852138","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-07-14DOI: 10.1016/j.gfj.2025.101156
Hyun-Jung Nam , Doojin Ryu , Peter G. Szilagyi
We examine the U-shaped effect of technological progress on CO₂ emissions using digital and high-tech trade as well as R&D levels as threshold variables. By analyzing a comprehensive European Union dataset, we reveal the U-shaped effects of digital and high-tech trade and R&D investment on CO₂ emissions, suggesting that technological progress modifies the conventional Environmental Kuznets Curve. At low levels of technological progress, it reduces CO₂ emissions; however, CO₂ emissions increase again beyond a certain threshold. Institutional quality moderates this relationship, highlighting its role in shaping the environmental impact of technological progress, and mitigates the negative impact of technological progress on emissions in its advanced stages. As investors become more aware of environmental liabilities and regulations, incorporating environmental factors into financial policies and risk management becomes crucial. Our findings underscore the role of institutional quality in mitigating the adverse effects of technological progress on CO₂ emissions.
{"title":"Technological progress and carbon emissions: Evidence from the European Union","authors":"Hyun-Jung Nam , Doojin Ryu , Peter G. Szilagyi","doi":"10.1016/j.gfj.2025.101156","DOIUrl":"10.1016/j.gfj.2025.101156","url":null,"abstract":"<div><div>We examine the U-shaped effect of technological progress on CO₂ emissions using digital and high-tech trade as well as R&D levels as threshold variables. By analyzing a comprehensive European Union dataset, we reveal the U-shaped effects of digital and high-tech trade and R&D investment on CO₂ emissions, suggesting that technological progress modifies the conventional Environmental Kuznets Curve. At low levels of technological progress, it reduces CO₂ emissions; however, CO₂ emissions increase again beyond a certain threshold. Institutional quality moderates this relationship, highlighting its role in shaping the environmental impact of technological progress, and mitigates the negative impact of technological progress on emissions in its advanced stages. As investors become more aware of environmental liabilities and regulations, incorporating environmental factors into financial policies and risk management becomes crucial. Our findings underscore the role of institutional quality in mitigating the adverse effects of technological progress on CO₂ emissions.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"67 ","pages":"Article 101156"},"PeriodicalIF":5.5,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144714496","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-07-24DOI: 10.1016/j.gfj.2025.101161
Weijie Tan , Yiqian Liu , Mingming Teng
News sentiment affects company practices. Using Baidu News reports spanning 2007–2022 on Chinese A-share listed companies as text data and machine learning and text analysis methods, this study measures environmental, social, and governance (ESG) news sentiment indices. This study examines the impact of ESG news sentiment on corporate financial asset allocation. Findings reveal that optimistic ESG news sentiment has a significant negative impact on corporate financial asset allocation. Mechanism analysis indicates that ESG news sentiment can restrain corporate financialization by facilitating corporate access to ESG-related financial support, reducing operational risks, and promoting real investments, which weakens risk aversion and profit-seeking motives. Further analysis reveals that the financialization governance function of ESG news sentiment is more prominent for private enterprises, during nonrecession periods, and for heavily polluting enterprises. Moreover, it is significant in regions with superior digital financial development and higher ESG governance intensity. From the perspective of ESG news content and information, the environmental and governance dimensions of news sentiment and neutral ESG news attention exhibit stronger financialization suppression effects. This study provides a new perspective for addressing financialization concerns and demonstrates the supervisory influence of the media on corporate sustainability.
{"title":"When ESG news talks: How media sentiment shapes corporate financial behavior in China","authors":"Weijie Tan , Yiqian Liu , Mingming Teng","doi":"10.1016/j.gfj.2025.101161","DOIUrl":"10.1016/j.gfj.2025.101161","url":null,"abstract":"<div><div>News sentiment affects company practices. Using Baidu News reports spanning 2007–2022 on Chinese A-share listed companies as text data and machine learning and text analysis methods, this study measures environmental, social, and governance (ESG) news sentiment indices. This study examines the impact of ESG news sentiment on corporate financial asset allocation. Findings reveal that optimistic ESG news sentiment has a significant negative impact on corporate financial asset allocation. Mechanism analysis indicates that ESG news sentiment can restrain corporate financialization by facilitating corporate access to ESG-related financial support, reducing operational risks, and promoting real investments, which weakens risk aversion and profit-seeking motives. Further analysis reveals that the financialization governance function of ESG news sentiment is more prominent for private enterprises, during nonrecession periods, and for heavily polluting enterprises. Moreover, it is significant in regions with superior digital financial development and higher ESG governance intensity. From the perspective of ESG news content and information, the environmental and governance dimensions of news sentiment and neutral ESG news attention exhibit stronger financialization suppression effects. This study provides a new perspective for addressing financialization concerns and demonstrates the supervisory influence of the media on corporate sustainability.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"67 ","pages":"Article 101161"},"PeriodicalIF":5.5,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144722042","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-06-10DOI: 10.1016/j.gfj.2025.101145
Hussain Faraj , David McMillan , Mariam Al-Sabah
For decades, gold has been considered as the most safe haven of assets in times of markets turmoil. However, this role has appears to have waned in recent years. This study aims to assess gold market behaviour over the past 37 years and examine the role of gold (and other precious metals) during periods of equity and bond market stress. Notably, we investigate whether gold lost its appeal as a safe haven asset due to its own market instability. Change point analysis, rolling mean, GARCH and DCC-GARCH approaches demonstrate that the gold market exhibits two distinct periods characterised by differing market movements, with a stable era followed by an unstable (highly volatile) era. Gold plays an insignificant role during the latter unstable period. Moreover, it exhibits a positive correlation in most high volatility periods with the S&P 500, again, especially during this latter period. This implies that gold is losing (or lost) its safe haven role during market stress and as the gold market encounters higher volatility periods, we anticipate a more positive correlation with the stock market in times of extreme stock market conditions. The outcomes challenge the prevailing definition of a gold safe haven, question the assumption of the stabilising role gold may offer to mitigate losses, and have important implications for investors seeking shelter in times of market stress.
{"title":"The diminishing lustre: Gold's market volatility and the fading safe haven effect","authors":"Hussain Faraj , David McMillan , Mariam Al-Sabah","doi":"10.1016/j.gfj.2025.101145","DOIUrl":"10.1016/j.gfj.2025.101145","url":null,"abstract":"<div><div>For decades, gold has been considered as the most safe haven of assets in times of markets turmoil. However, this role has appears to have waned in recent years. This study aims to assess gold market behaviour over the past 37 years and examine the role of gold (and other precious metals) during periods of equity and bond market stress. Notably, we investigate whether gold lost its appeal as a safe haven asset due to its own market instability. Change point analysis, rolling mean, GARCH and DCC-GARCH approaches demonstrate that the gold market exhibits two distinct periods characterised by differing market movements, with a stable era followed by an unstable (highly volatile) era. Gold plays an insignificant role during the latter unstable period. Moreover, it exhibits a positive correlation in most high volatility periods with the S&P 500, again, especially during this latter period. This implies that gold is losing (or lost) its safe haven role during market stress and as the gold market encounters higher volatility periods, we anticipate a more positive correlation with the stock market in times of extreme stock market conditions. The outcomes challenge the prevailing definition of a gold safe haven, question the assumption of the stabilising role gold may offer to mitigate losses, and have important implications for investors seeking shelter in times of market stress.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"67 ","pages":"Article 101145"},"PeriodicalIF":5.5,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144306997","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-06-14DOI: 10.1016/j.gfj.2025.101146
Edward R. Lawrence , Mehul Raithatha , Iván M. Rodríguez Jr.
We analyze the impact of terrorism on cross-border mergers and acquisitions (M&As) and find that terrorist attacks in acquirer and target countries significantly influence both the initiation and completion of M&As. While the presence of terrorism deters deal initiation, it paradoxically increases the likelihood of deal completion, suggesting a complex interplay of risk assessment and strategic decision-making. Furthermore, we find that firms accelerate completion after terrorist attacks.
{"title":"Terrorism and cross-border mergers and acquisitions","authors":"Edward R. Lawrence , Mehul Raithatha , Iván M. Rodríguez Jr.","doi":"10.1016/j.gfj.2025.101146","DOIUrl":"10.1016/j.gfj.2025.101146","url":null,"abstract":"<div><div>We analyze the impact of terrorism on cross-border mergers and acquisitions (M&As) and find that terrorist attacks in acquirer and target countries significantly influence both the initiation and completion of M&As. While the presence of terrorism deters deal initiation, it paradoxically increases the likelihood of deal completion, suggesting a complex interplay of risk assessment and strategic decision-making. Furthermore, we find that firms accelerate completion after terrorist attacks.</div></div>","PeriodicalId":46907,"journal":{"name":"Global Finance Journal","volume":"67 ","pages":"Article 101146"},"PeriodicalIF":5.5,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144307630","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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