Does business cycle heterogeneously impact on banks’ capital buffers, risk and financial stability in BRIC economies?

2020 ◽  
Vol 07 (04) ◽  
pp. 2050032
Author(s):  
Syed Moudud-Ul-Huq ◽  
Md. Nazmul Islam ◽  
Abdul Gaffar Khan ◽  
Md. Rostam Ali ◽  
Tanmay Biswas ◽  
...  
Keyword(s):  
Business Cycle ◽  
Financial Stability ◽  
Bric Countries ◽  
China And India ◽  
Adjustment Speed ◽  
The Business Cycle ◽  
Indian Banks ◽  
The Impact ◽  
The Relationship ◽  
India And China

This paper revisited the relationship between capital buffers and risk adjustments by showing the impact of the business cycle. Empirically, we used an unbalanced panel dataset from 426 banks of the BRIC countries (i.e., Brazil, Russia, India, and China) for the period 2007–2016. By using the two-step system GMM (2GMM), this study shows the results as: (i) capital buffers of Russia, India, and China behave counter-cyclically while it is pro-cyclical for Brazilian banks over the business cycle; (ii) in BRIC’s economy, credit risk, and bank financial stability is related to business cycle in counter and pro-cyclical fashion, respectively; (iii) capital buffers adjustment speed is the premier in China and India, shining banks accessibility to capital refill is much easier to Brazil and Russia. The adjustment speed is heterogeneous across countries; and (iv) financial stability in apex for the Chinese, Russian, and Indian banks apart from the Brazilian banks.

scholarly journals The Effect of Health Expenditure per Capita over Health Indicators: Comparative Analysis of MINT and BRIC Countries

2014 ◽  
Author(s):  
Volkan Öngel ◽  
Erkut Altındağ ◽  
Gökten Öngel
Keyword(s):  
Health Expenditure ◽  
Health Indicators ◽  
Bric Countries ◽  
Life Expectancy At Birth ◽  
Per Capita ◽  
The Impact ◽  
The Relationship ◽  
Positive Effect ◽  
India And China ◽  
Birth Time

Major positive effect on health indicators of a country is seen to arise from the increase in their income within historical perspective. But according to many studies in the literature the impact of such changes vary depending on the country's overall level of development. In terms of the positive changes over the health indicators of a country can be said to affect the developmental processes in the same way especially in developing countries. In this context, our study highlights the recent and emerging economies of two groups of countries; BRIC (Brazil, Russia, India, and China) and MINT (Mexico, Indonesia, Nigeria, Turkey). The relationship between health expenditure per capita and life expectancy at birth time and mortality rates of children under age 1 are analyzed retrospectively.

scholarly journals Influence of the Information Background on the Economic Behavior of Households

2018 ◽  
Vol 13 (5) ◽  
pp. 66-79
Keyword(s):  
Economic Theory ◽  
Business Cycle ◽  
Semantic Analysis ◽  
Interdisciplinary Studies ◽  
Economic Behavior ◽  
Homo Economicus ◽  
Economic News ◽  
The Business Cycle ◽  
The Impact ◽  
The Relationship

The article is devoted to the role of the information background in household decisions on consumption-savings. The issue of behavioral prerequisites for decision-making has lately become the mainstream of economic theory. The crisis of the “absolutely rational subject” as a concept led to the development of theories of bounded rationality and to the search for noneconomic determinants of micro- and macroeconomic processes. As a result of interdisciplinary studies conducted at the intersection of psychology, sociology, political science and economics, modern economic theory has been enriched with new approaches and concepts that better describe the reality than models based on the axiom of homo economicus. The main limitations of the rationality of economic entities include the imperfection of information that is available and is at the same time reliable, as well as the necessary costs of its processing plus the probability of errors. The present study is intended to make a contribution to this theory by investigating the impact of the information component in the form of economic news on the behavior of Russian households in terms of disposition of available incomes. The research was based on a selection of news for 2006–2016 by the main television channels of the Russian Federation — the most accessible and trustworthy source of information for households according to public opinion polls. The news was evaluated as negative or positive with the help of linguistic and semantic analysis, and afterwards an econometric analysis of the relationship with economic indicators was performed. It turned out that an increase in uncertainty (expansion of the “spread of negativity and positivity” news) leads to a choice in favor of current consumption, which leads to a reduction of savings as the national investment base. In addition, the authors analyzed the relationship between the tonality of news and its dynamics with the business cycle. The analysis revealed that the “information” cycle correlates, with a certain lag, with the business cycle.

scholarly journals Threshold Effect of the Government Intervention in the Relationship Between Business Cycle and Population Health: Evidence From China

2021 ◽  
Vol 9 ◽  
Author(s):  
Kuang-Cheng Chai ◽  
Yang Yang ◽  
Zhen-Xin Cui ◽  
Yang-Lu Ou ◽  
Ke-Chiun Chang
Keyword(s):  
Business Cycle ◽  
Population Health ◽  
Government Intervention ◽  
Threshold Value ◽  
Threshold Effect ◽  
Chinese Government ◽  
The Business Cycle ◽  
The Government ◽  
The Impact ◽  
The Relationship

China is an emerging country, and government intervention is always considered as an important part of the solutions when people facing challenges in China. Under the impact of the coronavirus disease 2019 (COVID-19) epidemic and the global economic downturn, the Chinese government quickly brought the epidemic under control and restored the positive economic growth through strong intervention. Based on the panel data of provincial level in China and the government intervention as the threshold variable, this paper empirically analyzed the non-linear effect of business cycle on population health by using the panel threshold regression model. The empirical results show that the impact of the business cycle on population health is significantly negative, and government intervention has a single threshold effect on the relationship between business cycle and population health. When the government intervention is below the threshold value, the business cycle has a significant negative effect on the improvement of the population health level; when the level of government intervention exceeds the threshold value, the relationship between business cycle and population health becomes significantly positive. To some extent, the conclusions of this paper can guide the formulation and revision of government health policy and help to adjust the direction and intensity of government intervention. The Chinese government and other governments of emerging countries should do more to harness the power of state intervention in their response to the business cycle.

The Relationship Between Gender and Promotion Over the Business Cycle: Does Firm Size Matter?

2021 ◽  
Author(s):  
George Saridakis ◽  
Priscila Ferreira ◽  
Anne‐Marie Mohammed ◽  
Susan Marlow
Keyword(s):  
Business Cycle ◽  
Firm Size ◽  
The Business Cycle ◽  
Size Matter ◽  
The Relationship

scholarly journals Credit procyclicality and financial regulation in South Africa

2016 ◽  
Vol 19 (4) ◽  
pp. 467-478
Author(s):  
James Bernstein ◽  
Leroi Raputsoana ◽  
Eric Schaling
Keyword(s):  
South Africa ◽  
Business Cycle ◽  
Financial Institutions ◽  
Financial Regulation ◽  
Banking Supervision ◽  
Expansion Phase ◽  
Reference Guide ◽  
Common Reference ◽  
The Business Cycle ◽  
The Relationship

This study assesses the behaviour of credit extension over the business cycle in South Africa for the period 2000 to 2012. This is motivated by the proposal of the Basel Committee on Banking Supervision to look at credit extension over the business cycle as a reference guide for implementing countercyclical capital buffers for financial institutions. The study finds that credit extension in South increases during the trough phase, while the relationship between credit extension and the business cycle becomes insignificant during the peak phase. The study also finds that credit extension decreases during the expansion phase, while it increases during the contraction phase. Thus we do not find any evidence of procyclical behaviour of credit extension in South Africa, and the latter should therefore be used with caution and not as a mechanical rule based common reference guide for countercyclical capital buffers for financial institutions. 

scholarly journals Protection and the Business Cycle

2003 ◽  
Vol 3 (1) ◽  
Author(s):  
Kyle Bagwell ◽  
Robert W. Staiger
Keyword(s):  
Business Cycle ◽  
Empirical Studies ◽  
Trade Policies ◽  
Trade Volume ◽  
Upward Trend ◽  
Theoretical Support ◽  
Empirical Regularities ◽  
The Business Cycle ◽  
Liberal Trade ◽  
The Relationship

Abstract Empirical studies have repeatedly documented the countercyclical nature of trade barriers. In this paper, we propose a simple theoretical framework that is consistent with this and other empirical regularities in the relationship between protection and the business cycle. Focusing on self-enforcing trade agreements, we find theoretical support for countercyclical movements in protection levels. The fast growth in trade volume that is associated with a boom phase facilitates the maintenance of more liberal trade policies than can be sustained during a recession phase in which growth is slow. We also find that acyclic increases in the level of trade volume give rise to protection, implying that whether rising imports are met with greater liberalization or increased protection depends on whether they are part of a cyclic upward trend in trade volume or an acyclic increase in import levels.

scholarly journals Bank wholesale funding and credit procyclicality: Evidence from Korea

2013 ◽  
Vol 60 (5) ◽  
pp. 615-631 ◽  
Author(s):  
Sangjun Jeong ◽  
Hueechae Jung
Keyword(s):  
Business Cycle ◽  
Emerging Economies ◽  
Commercial Banks ◽  
Marked Effect ◽  
The Other ◽  
Financial Fragility ◽  
Credit Growth ◽  
The Business Cycle ◽  
The Relationship ◽  
Higher Sensitivity

Credit procyclicality has recently been the focus of considerable attention, but what fuels the often excessive credit growth is rarely questioned. We investigate the relationship between the composition of banks? liabilities and their credit procyclicality. After examining the macroeconomic context where banks rely increasingly on wholesale funding (WSF), we estimate the effect of WSF on the banks? credit growth using quarterly panel data for the commercial banks of Korea from 2000 to 2011. We find that a higher sensitivity of banks? WSF to the business cycle leads to an excessive response of credit growth to the business cycle, even with a low share of WSF on bank liabilities. On the other hand, we find that overseas WSF has a more marked effect on credit procyclicality, which may additionally exacerbate the financial fragility of export-led emerging economies.

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