Australia's Bond Home Bias

2014 ◽  
Vol 17 (01) ◽  
pp. 1450001
Author(s):  
Anil V. Mishra ◽  
Umaru B. Conteh
Keyword(s):  
Rule Of Law ◽  
Exchange Rate Volatility ◽  
Home Bias ◽  
Accounting Standards ◽  
Bond Markets ◽  
Government Effectiveness ◽  
Cross Border ◽  
Regulatory Quality ◽  
System Risk

This paper constructs the float adjusted measure of home bias and explores the determinants of bond home bias by employing the International Monetary Fund's high quality dataset (2001 to 2009) on cross-border bond investment. The paper finds that Australian investors' prefer investing in countries with higher economic development and more developed bond markets. Exchange rate volatility appears to be an impediment for cross-border bond investment. Investors prefer investing in countries with stronger quality of institutions including bureaucratic quality, government effectiveness, regulatory quality, rule of law, efficiency of judicial system, risk of contract repudiation, and rating of accounting standards.

scholarly journals Stay at Home! Governance Quality and Effectiveness of Lockdown

2021 ◽  
Author(s):  
Vincenzo Alfano ◽  
Salvatore Ercolano
Keyword(s):  
Rule Of Law ◽  
Global Scale ◽  
Considerable Time ◽  
Government Effectiveness ◽  
Governance Indicators ◽  
Regulatory Quality ◽  
Governance Quality ◽  
World Governance Indicators ◽  
Set Up ◽  
First Time

AbstractIn order to control the spread of the COVID-19 pandemic, during the first wave of the pandemic numerous countries decided to adopt lockdown policies. It had been a considerable time since such measures were last introduced, and the first time that they were implemented on such a global scale in a contemporary, information intensive society. The effectiveness of such measures may depend on how citizens perceive the capacity of government to set up and implement sound policies. Indeed, lockdown and confinement policies in general are binding measures that people are not used to, and which raise serious concerns among the population. For this reason governance quality could affect the perception of the benefits related to the government’s choice to impose lockdown, making citizens more inclined to accept it and restrict their movements. In the present paper we empirically investigate the relation between the efficacy of lockdown and governance quality (measured through World Governance Indicators). Our results suggest that countries with higher levels of government effectiveness, rule of law and regulatory quality reach better results in adopting lockdown measures.

scholarly journals Does Higher Religiosity Translate into Higher Institutional Quality? Evidence From 98 Countries

SAGE Open ◽  
2019 ◽  
Vol 9 (3) ◽  
pp. 215824401986580
Author(s):  
Ayse Y. Evrensel ◽  
Itai Sened
Keyword(s):  
Rule Of Law ◽  
Institutional Quality ◽  
World Values Survey ◽  
Government Effectiveness ◽  
The Rule Of Law ◽  
Country Level ◽  
Regulatory Quality ◽  
Moral Standards ◽  
Corrupt Behavior ◽  
Government Benefits

This article examines whether individuals’ higher moral values stemming from higher religiosity lead to higher institutional quality at the country level. Based on the data from World Values Survey (WVS, 1980-2014) with 343,440 respondents, the results indicate that higher religiosity is associated with lower justifiability of corrupt behavior such as cheating on taxes, receiving false government benefits, and taking bribes. However, at the level of 98 countries from which the respondents in the WVS stem, higher religiosity seems to have an adverse effect on institutional quality as measured in corruption control, executive constraints, government effectiveness, regulatory quality, and the rule of law. Therefore, higher religiosity and moral standards at the respondent level may not translate into higher institutional quality at the country level. We discuss possible reasons for this discrepancy.

Innovation and institutions’ quality: a comparative study between countries

2020 ◽  
Vol 12 (2) ◽  
pp. 169-185
Author(s):  
Marcelo Koji Kawabata ◽  
Alceu Salles Camargo Junior
Keyword(s):  
Foreign Direct Investments ◽  
Content Type ◽  
Government Effectiveness ◽  
Business Environments ◽  
Innovation Activities ◽  
Regulatory Quality ◽  
The World Bank ◽  
Global Innovation ◽  
The Relationship

Purpose Innovation has been considered as an essential activity for companies to compete in modern and dynamic business environments. For the nations, innovation is considered a fundamental key activity for sustaining economic growth and competitive advantage over other countries. This paper aims to achieve a better understanding of the relationship between the quality of a country’s institutions and its levels of innovation activities and results. Design/methodology/approach Controlling for the effects of the efforts and investments in research and development (R&D) and the foreign direct investments (FDI), this work proceeds to regression analysis to obtain the association between the quality of countries’ institutions and their innovation activities. Data was obtained from the Global Innovation Index (GII) for innovation activities and the Worldwide Governance Index, of the World Bank, for the quality of institutions for 127 countries. Findings The results show that the effectiveness of public administration and the regulatory quality are the quality of institution variables associated with the innovation activities. Also, this paper obtained a clustering of countries with a rank regarding not only innovation activities but also the conditions of the institutions’ quality, based on government effectiveness, regulatory quality, R&D, FDI and GII. This new compounded classification divided the 127 countries into three clusters – mature innovators, fresh innovators and structuring for innovation. Originality/value New forms of innovations’ ranking viewing can help to understand the conditionings that enhance countries’ and institutions’ competitiveness.

FOREIGN DIRECT INVESTMENT INFLOWS AND REGULATION IN NIGERIA: AN EMPIRICAL PERSPECTIVE

2019 ◽  
Vol 9 (1) ◽  
pp. 157-168
Author(s):  
Aderemi Timothy Ayomitunde ◽  
Amusa Bolanle Olubunmi ◽  
Awomailo Lanke B ◽  
Olayemi Henry Omotayo
Keyword(s):  
Rule Of Law ◽  
Business Environment ◽  
Policy Makers ◽  
Fdi Inflows ◽  
Government Effectiveness ◽  
Cross Border ◽  
Long Run ◽  
Equilibrium Relationship ◽  
Good Government ◽  
Empirical Perspective

The aim of this study is to examine the long run equilibrium relationship between regu-lation and FDI inflows in Nigeria over the period of 1990 to 2016 which past studies have failed to explore. Consequently, the study utilized data from UNCTAD, World Bank database, CBN Statistical Bulletin and Cointegration, DOLS and Granger Cau-sality approach was used to address the objective of this study. However, the major findings in this study are summarized as follows. Government effectiveness, rule of law and inflation rate have a significant positive relationship with FDI inflows in Nigeria in the long run, apart from regulation quality that is not significant. This implies that regulation is favorable to the inflows of cross border investment in the country. In addition, there is a unidirectional feedback relationship which runs from FDI inflows to regulation quality and one way feedback relationship runs from the rule of law to government effective-ness in the country. Finally, due to the findings that emerged from this study, the fol-lowing recommendations are made for the policy makers, investors and future re-searchers in Nigeria that when attraction of FDI inflows are the target of the policy makers in the country, improving variables like rule of law, government effectiveness and regulation quality will induce the inflows of cross border investment accordingly in the long run. Also, the Nigerian government should be committed to the provision of a sound business environment in the form of good government regulations to ensure rapid inflows of FDI in the country.

scholarly journals Institutional Analysis of Shadow Economy (Study on ASEAN 7 Developing Countries)

2020 ◽  
Vol 15 (1) ◽  
pp. 55
Author(s):  
Ana Rahmawati Wibowo ◽  
Wiwin Indrayanti
Keyword(s):  
Developing Countries ◽  
Rule Of Law ◽  
Shadow Economy ◽  
Secondary Data ◽  
Political Stability ◽  
Government Effectiveness ◽  
Regulatory Quality ◽  
Negative Effect ◽  
And Control ◽  
Control Of Corruption

This study aims to analyze the institutional variables of governance in ASEAN 7 developing countries. The independent variables consist of Voice and Accountability, Political Stability and Absence of Violence, Government Effectiveness, Regulatory Quality, Rule of Law and Control of Corruption, while shadow economy is dependent variable. The data used in this study are quantitative data and secondary data by using program Stata 14, the analysis technique used is multiple linear regression panel data. The results show that Voice and accountability has a negative and significant effect on the shadow economy as well as Political stability, Government effectiveness and Control of corruption on the other side. Regulatory quality has a positive and significant effect on the amount of shadow economy. Meanwhile, Rule of law no significant effect on the shadow economy. Underlying the results, the study arranges some policy to reduce negative effect of shadow economy.

scholarly journals The Governance and Tourism: A Case of Developing Countries

2021 ◽  
Vol 9 (3) ◽  
pp. 199-213
Author(s):  
Rana Ejaz Ali Khan ◽  
Tusawar Iftikhar Ahmad ◽  
Jaweria Haleem
Keyword(s):  
Rule Of Law ◽  
Good Governance ◽  
Developing Economies ◽  
Trade Openness ◽  
Tourism Development ◽  
Political Stability ◽  
Method Of Moment ◽  
Total Employment ◽  
Government Effectiveness ◽  
Regulatory Quality

Tourism is a rapidly growing industry globally and it is contributing a significant part in the GDP of the economies. In the literature, a variety of determinants of tourism are discussed theoretically and empirically but the effect of national governance on tourism is rarely discussed. This study investigates the effect of governance on tourism development in a panel of 65 developing economies for the time period of 2000-2015. Tourism development is measured by an index of three components, i.e. spending by international tourists, spending by local tourists and tourism’s share in total employment in the economy. For governance an index is constructed based on indicators of government effectiveness, political stability, regulatory quality, rule of law, and voice and accountability. Data has been taken from World Development Indicators (WDI), Worldwide Governance Indicators (WGI) and World Travel and Tourism Council (WTTC). Generalized Method of Moment (GMM) estimation indicates that governance positively influence tourism development and its components, i.e. foreign visitors spending, domestic tourist spending and contribution of tourism in employment. The indicators of governance, i.e. government effectiveness, political stability, regulatory quality, rule of law and voice and accountability also positively affect tourism development. Terrorism, environmental degradation and corruption have shown adverse effect on tourism development as well as components of tourism development. The economic growth and trade openness have encouraging effect on tourism development and its comments. It is concluded that through good governance tourism may be developed but terrorism and corruption are needed to be eliminated.

scholarly journals Institutional Quality and Sukuk Development: A Study of Five OIC Countries

2020 ◽  
Vol 5 (3) ◽  
pp. 286
Author(s):  
Nuhbatul Basyariah ◽  
Hadri Kusuma ◽  
Ibnu Qizam
Keyword(s):  
United Arab Emirates ◽  
Rule Of Law ◽  
Institutional Quality ◽  
Three Dimensions ◽  
Method Of Moment ◽  
Government Effectiveness ◽  
Governance Indicators ◽  
Regulatory Quality ◽  
Panel Data Regression ◽  
Data Regression

The objective of this study is to shed some light on the effect of institutional quality on the development of the global sukuk market. Specifically, this study examines the impacts of the institutional quality that adopts three dimensions of the Worldwide Governance Indicators (WGI), i.e., Rule of Law (RL), Regulatory Quality (RQ), and Government effectiveness (GE) on the global sukuk development of the top-five countries of sukuk issuance, i.e., Malaysia, Kingdom of Saudi Arabia, United Arab Emirates, Indonesia, and Bahrain. Drawing on a quantitative study with the data in the forms of global sukuk issuance from 2002 to 2017, panel-data regression (OLS) and General Method of Moment (GMM) were applied. This study showed that RL and GE have a significantly positive effect on sukuk issuance; however, RQ did not influence the development of the global sukuk market. These results imply that a country that is capable to maintain the institutional quality, especially in terms of rule of law and government effectiveness, will most likely be the country that can successfully develop the sukuk market. These results play a crucial role in filling a research gap among previous studies and provide an empirical evidence of the government’s role and its influence on the sukuk development.

scholarly journals Increasing Supply of Tradable Goods in the Common Market for Eastern and Southern Africa (COMESA)

2015 ◽  
Vol 1 (2) ◽  
pp. 73-117
Author(s):  
Macleans Mzumara
Keyword(s):  
Foreign Direct Investment ◽  
Rule Of Law ◽  
Direct Investment ◽  
Institutional Quality ◽  
Political Stability ◽  
Government Effectiveness ◽  
Regulatory Quality ◽  
Tradable Goods ◽  
And Control ◽  
Control Of Corruption

The author investigated the nature of institutional quality in the Common Market for Eastern and Southern Africa (COMESA) on the basis of voice and accountability political stability, government effectiveness, regulatory quality, rule of law and control of corruption. The author further investigated the existence of a link between institutional quality and factors of production. The results show that capital, entrepreneurship and foreign direct investment are the major determinants of production of tradable goods in COMESA. In exception of Mauritius and Namibia (currently no longer a member) the rest of COMESA member states have very poor institutional quality. This affects their ability to attract foreign direct investment hence production of tradable goods. Voice and accountability, government effectiveness, rule of law and political stability play a major role in increasing production of tradable goods in COMESA. Foreign direct investment is affected by voice and accountability, rule of law and political stability than any other factors. Availability of raw material is affected by government effectiveness, regulatory quality, political stability, voice and accountability and control of corruption. Capital is very sensitive to issues of voice and accountability and control of corruption and regulatory quality.

scholarly journals Does Institutional Quality Matter in the Relationship Between Competition and Bank Stability? Evidence from Asia

2021 ◽  
Vol 36 (3) ◽  
pp. 283-301
Author(s):  
Muizzuddin Muizzuddin ◽  
Eduardus Tandelilin ◽  
Mamduh Mahmadah Hanafi ◽  
Bowo Setiyono
Keyword(s):  
Rule Of Law ◽  
Negative Impact ◽  
Generalized Method Of Moments ◽  
Institutional Quality ◽  
Political Stability ◽  
Bank Stability ◽  
Government Effectiveness ◽  
The Rule Of Law ◽  
Regulatory Quality ◽  
The Relationship

Introduction/Main Objectives: This study aims to investigate whether competition impacts bank stability. Furthermore, the study also analyzes the role of institutional quality in a country, such as voice and accountability, political stability, government effectiveness, regulatory quality, the rule of law, and control of corruption, forming the effect of competition on bank stability. Background Problem: Analysis of the relationship between competition and bank stability has been at the center of academic and policy debate. However, the theoretical and empirical research has not concluded whether bank competition leads to more or fewer stable banks. Novelty: We consider institutional quality's role in mitigating the negative impact of competition on bank stability, which has mainly been under-elaborated in prior studies, particularly in using measures from The World Bank’s Worldwide Governance Indicators, which measure how the institutions of each country influence bankers’ and the people's behavior, as part of the cultural system. Research Methods: Using a sample of 427 Asian commercial banks from 2011 to 2019, we employ the generalized method of moments (GMM) estimator and consider loan growth and the cost to income ratio as instrumental variables. Findings/Results: We find robust evidence that competition erodes bank stability. Besides, better institutional quality, especially government effectiveness, regulatory quality, the rule of law, and corruption control in each country are important aspects that promote bank stability and mitigate the negative impact of competition on bank stability. Conclusion: Competition has a negative impact on bank stability. Meanwhile, the quality of institutions can both promote bank stability and mitigate this negative relationship.

scholarly journals Corruption Perception following Privatization Reforms: The Moderating Role of Governance

2020 ◽  
Vol 23 (1) ◽  
pp. 127-137
Author(s):  
Beatriz Cuadrado-Ballesteros ◽  
Noemí Peña-Miguel
Keyword(s):  
Government Effectiveness ◽  
Regulatory Quality ◽  
Corruption Perception ◽  
Quality Of Governance ◽  
Governance Quality ◽  
And Control ◽  
Control Of Corruption ◽  
Moderating Role

Este estudio analiza la corrupción percibida tras las reformas de privatización, teniendo en cuenta el papel del buen gobierno, en 22 países europeos entre 2002 y 2013. Un primer análisis inicial no revela cambios relevante en la corrupción percibida después de las reformas de privatización, pero estos resultados son moderados por la calidad del gobierno (governance). En general, los resultados empíricos sugieren que la corrupción es menor cuando el nivel de buen gobierno se incrementa, el cual afecta a la corrupción percibida después de que se llevan a cabo privatizaciones de empresas públicas. Concretamente, la rendición de cuentas, la efectividad del gobierno en la aplicación de políticas públicas, la calidad de la regulación, el Estado de Derecho, y los mecanismos de control de la corrupción son esenciales para su prevención tras las reformas de privatización. This study analyzes perceived corruption following privatization reforms, taking into account the role of governance quality in 22 European countries from 2002 to 2013. Initial analysis did not reveal significant changes in perceived corruption after privatization reforms, but the results are moderated by governance quality. In general, the empirical findings suggest that corruption is lower when the quality of governance increases, and it additionally affects perceived corruption after privatization reforms. Concretely, accountability, government effectiveness, regulatory quality, the rule of law, and control of corruption mechanisms are essential to prevent corruption after privatization.

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