Economic Systems最新文献

The amount of credit assets held by non-bank institutions has increased substantially in recent decades, to the point where it exceeded the amount held by depository institutions in the United States before the Global Financial Crisis. Our research aims to gain evidence on whether the credit channel of monetary policy, i.e. the transmission of monetary interventions through bank lending, has been altered by the enlargement of the non-bank sector. The analysis is based on the period before the Global Financial Crisis in order to apply a theory-consistent identification of conventional monetary interventions within a large Bayesian vector auto-regression. The results indicate an uncertain transmission when the non-bank sector is larger, casting doubt on the grip of monetary interventions in an evolving scenario.

This paper studies the relationship between the exchange rate and inflation within China and the United States using the bootstrap rolling-window approach. We provide robust evidence to show that the purchasing power parity (PPP) theory is invalid for the whole period. The impact of the China-US exchange rate on relative inflation is greater than the effect of relative inflation on the exchange rate. The negative effect of the China-US exchange rate on inflation is more evident from 2006 to 2014, and inflation is more affected by the exchange rate in the US than that in China. The positive effect of US inflation on the China-US exchange rate only exists from January to July 2019 and the negative effect of China’s inflation on the exchange rate merely exists from August 2008 to July 2010 and from September 2010 to May 2011. These findings have important implications for maintaining the stability of prices and currency values in the trade market.

In this paper, we provide a new look at convergence in the EU while focusing on development at the regional level between the Great Recession and the recent COVID crisis. We use the log t convergence test by Phillips and Sul (2007) to analyze convergence in income level among the European regions. We identified five convergence clubs rather than supporting the overall convergence hypothesis. Furthermore, we investigated the determinants of convergence club membership using logistic regression. Our results confirmed high inequality within the member states and a shifting geographic pattern of the top-performing regions, with the increasing prominence of the manufacturing core in southern Germany and the surrounding areas. We found a positive association between membership in higher clubs, research and patent activities, and specialization in manufacturing. We also confirmed the positive economic performance of capital cities and the main metropolitan areas.

This study analyzes the impact of religion on environmental quality. Constructing a theoretical model built on the Schumpeterian production function, we reveal that religion can promote pollution emissions. Moreover, the mediating effects of labor force and product variety innovation between religion and pollution are positive. Furthermore, the mediating role of quality improving innovation varies across different stages of economic development. Our findings provide useful insights for policymakers seeking to enhance environmental quality.

Digital financing platforms have enhanced accessibility for households that wish to invest in wealth management products, but their impact on stock market participation remains underexplored in the literature. This paper investigates the effect of internet wealth management products on the household propensity to invest and participate in the stock market, using the microlevel dataset from the China Household Finance Survey, which covers 40,011 households. Our findings reveal that purchasing internet wealth management products positively and significantly influences the household inclination to invest and stock market participation level. Moreover, households with internet wealth management products have higher financial awareness and heightened interest in financial news. These characteristics not only reduce information costs but also promote stock market participation. Furthermore, the impact of purchasing internet wealth management products on stock market participation is more pronounced among households with higher education and lower income risk and residence in regions with a more developed financial market.

Fluctuations in commodity prices can have an impact on a firm’s costs and revenues, national income, or a country’s creditworthiness, leading to increased borrowing and levels of domestic credit. These effects need not be symmetric; it is possible that losses due to a commodity price decrease might be worse than the gains that result from an equivalent price increase. In addition, these dynamics might differ between frequently studied commodity exporters and energy importers such as those in Central and Eastern Europe. Here, an index of commodity prices and their volatility are included in a time-series model alongside the traditional macroeconomic determinants for 11 of these EU members. Forecast Error Variance Decompositions reveal that shocks to commodity prices spill over most strongly to inflation in Latvia and credit growth in Poland and Slovakia—the two countries that have seen continuous increases in credit. Cointegration analysis shows that while GDP growth and inflation drive credit levels in many cases, commodity price increases lead to increased credit shares in the Czech Republic, Latvia and Lithuania. A nonlinear model finds that commodity price increases also increase credit in Romania, while decreases lead to increased credit shares in Hungary. Commodity price volatility leads to credit increases in Latvia and Lithuania, confirming that these two Baltic countries are most affected by macroeconomic shocks.

This study examines the effect of option incentives on corporate innovation in a representative emerging and transitioning economy. Using data from China, we show that option incentives have significant positive impacts on two crucial aspects of innovation: inputs and outputs. Innovation efficiency consistently improves after the introduction of option incentives. These positive effects remain when we control for potential endogeneity using difference-in-differences estimation with propensity score matching. Option incentives have more pronounced effects in high-tech firms than in other firms. Our findings suggest that firms’ specific characteristics and needs should be considered when developing incentive policies.

The aim of this paper is to determine whether monetary policy has a heterogeneous impact on net worth and consumption across races in the United States by applying several empirical methodologies and combining macro and micro data. The results suggest that an expansionary monetary shock increases the race gap in the short run in terms of net worth and that this is explained by differences in portfolio composition, especially between black and white households. Consequently, the heterogeneous wealth effect among these racial groups means that white households retain a higher elasticity than some minorities with respect to different forms of consumption as a consequence of a monetary policy shock. Although the heterogeneous effects of monetary policy across race are primarily explained by the different observable characteristics of households, a non-negligible part of this heterogeneity could be explained by the credit constraints faced by racial minorities that determine the composition of their wealth.

This paper investigates a time-varying version of weak-form market efficiency in the BRICS countries. A moving window test for sample autocorrelations is applied alongside a Kalman filter approach to recover the hidden dynamics of the market efficiency process through appropriate time-varying autoregressive models with both homoscedastic and heteroscedastic conditional variance. Monthly data cover the period from January 1995 to December 2020, which includes the 2008–2009 global financial crisis and the recent COVID-19 recession. The results reveal that all the BRICS stock markets were affected during both periods, but generally remained weak-form efficient, with the exception of China.

We study the influence of the exchange rate on the speed of economic recovery in a sample of 67 developed and developing economies over the years 1989–2019. First, using a cross-sectional sample of 341 economic recoveries, we study the effect of nominal depreciation and real undervaluation on the length of economic recovery. Our findings indicate that a small nominal depreciation, as well as a real undervaluation of the domestic currency, increases the speed of economic recovery. However, this effect is small in size. Second, we use an interacted panel VAR (IPVAR) model to investigate the effect of real undervaluation on the speed of economic recovery after an external shock. While we once again find evidence that an undervalued domestic currency increases the speed of economic recovery, its positive effect is limited in size. Furthermore, we also explore the role of financial development in influencing the effectiveness of an undervalued domestic currency in stimulating economic recovery. We find that a higher level of financial development limits the negative effect of an overvalued currency on the speed of economic recovery, but does not influence the effect of an undervalued currency on economic recovery.