FOREIGN INVESTMENT AND THE POLITICAL ECONOMY OF INDONESIAN CAPITAL MARKET IN 2015-2016

2019 ◽  
Vol 7 (6) ◽  
pp. 340-348
Author(s):  
Faris Al-Fadhat ◽  
Mohammad Raihan Nadhir
Keyword(s):  
Political Economy ◽  
Interest Rates ◽  
Foreign Investment ◽  
Capital Market ◽  
International Political Economy ◽  
Stock Exchange ◽  
Economic Stability ◽  
Foreign Investors ◽  
The Impact ◽  
The Capital Market

Purpose of the study: This article examines the impact of foreign investment—especially through the capital market—towards the economic stability and strategic policy in Indonesia. Despite being a member of G20, a group of states with the world’s highest Gross Domestic Products, Indonesia is still a developing state whose need for investment to support economic growth is high. On the other side, Indonesia has a low capital accumulation rate due to low people’s savings which inhibits the development projects. Therefore, the government prioritizes the incoming flow of foreign investment. Methodology: This study applies the international political economy approach to provide critical analysis of Indonesian contemporary foreign investment, especially in the capital market. The data used is the investment activities through the Indonesia Stock Exchange during 2015-2016. Main Findings: It argues that Indonesia’s considerable dependence on investment has enabled foreign investors to play the capital flow to influence the national economic stability for their interests. Such influence was a result of two strategies: (i) the transaction domination in the capital market through the Indonesia Stock Exchange, and (ii) the alliance with financial actors in accessing inside information—which is not commonly owned by domestic investors. Implications/Applications: This study suggests that the politics of foreign investors has contributed towards the changes of government policies in the financial sectors to facilitate the process and to ensure the flow of foreign investment to Indonesia. Such policies include the government’s control of interest rates, fiscal policy, as well as currency stability through macroprudential regulation. Novelty/Originality: Essentially, the capital market is not politically neutral. It has been used by foreign investors to augment their interests by dominating transactions and building political alliances at the domestic level.

Growth of Capital Market in Nepal: Impact on Capitalization, GDP and NEPSE Index

2020 ◽  
Vol 11 ◽  
pp. 66-83
Author(s):  
Dhan Raj Chalise
Keyword(s):  
Capital Market ◽  
Significant Contribution ◽  
Positive Impact ◽  
Stock Exchange ◽  
Secondary Data ◽  
Secondary Market ◽  
Financial Resources ◽  
Descriptive Research ◽  
The Impact ◽  
The Capital Market

The capital market plays an importance role in an economy and provides the opportunity to the investor for the mobilization and channelization of funds. Nepalese capital market is in growing and improving phase. The objective of this study is to analyze the evaluation of the existing status of the capital market in term of its composition of types of the capital market and to examine the impact of capital mobilization in Gross Domestic Product (GDP) and to examine the contribution of capital market in financial resources and GDP. Besides, the study examines the share transaction in Nepal Stock Exchange (NEPSE) and its impact on NEPSE Index. The study period of 2000/01 to 2018/19 has been used for study purposes. Through the use of descriptive research design, the trends of capital market development track after 2000/01 to present status has been presented. Secondary data are analyzed through the use of regression and other descriptive statists to convert the information into data. The result indicates that the ordinary shares in the primary capital market and market capitalization in the secondary market has significant contribution for the capital market in Nepal. Also, the study reveals that there is a significant and positive impact of capital mobilization on GDP and the number of share transactions on the NEPSE Index in the Nepalese capital market. Hence there is a significant contribution of the capital market for financial resources mobilization and GDP of Nepal. The study reports for modernization and systematization of the capital market need more optimal efforts from concerned stakeholders.

scholarly journals INTEREST RATE REGIME AND THE PERFORMANCE OF THE NIGERIAN CAPITAL MARKET

2015 ◽  
Author(s):  
Edirin Jeroh ◽  
C. M. Ekwueme
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Capital Market ◽  
Stock Exchange ◽  
Least Square ◽  
Policy Makers ◽  
Ordinary Least Square ◽  
Policy Review ◽  
Policy Measures ◽  
The Impact

This study x-ray’s the interest rates regime in Nigeria as it affects the performance of the Nigerian Capital Market. In order to achieve this objective, relevant data for a period of 33 years spanning from 1981 – 2013 were obtained from the Factbook of the Nigerian Stock Exchange, CBN Statistical Bulletin as well as the annual accounts of quoted firms for the relevant years. The data obtained were analysed with the Ordinary Least Square (OLS) technique. The result from our analysis reveal among others that changes in interest rate regimes have majorly influenced the level of the performance of the Nigerian Capital Market. Based on the above, we recommend that capital market regulators and other regulatory agencies should keep an eye on movements in interest rates and the Minimum Rediscount Rate (MRR) (now MPR) and watch their trend. We also recommend that efforts must be put in place to establish a policy review and reassessment mechanism that would help in assessing the impact of selected policy measures on the economy so that policy makers would know the effectiveness and efficiency of designed policies and be guided in the policy review and development process in the country.

scholarly journals Capital Market Reaction Analysis Before and After Bank Indonesia's Decision Regarding Interest Rates

Academia Open ◽  
2021 ◽  
Vol 3 ◽  
Author(s):  
Putri Yuliean Fajarwati ◽  
Nurasik
Keyword(s):  
Interest Rates ◽  
Capital Market ◽  
Trading Volume ◽  
Quantitative Research ◽  
Stock Exchange ◽  
Study Data ◽  
Average Abnormal Return ◽  
Before And After ◽  
The Capital Market

The development of capital market activities can not be separated from the role of investors as investors and disclosure of information as consideration of investor decision making.This research aims to find out how the capital market reacts before Bank Indonesia's decision on interest rates.And to find out how the capital market reacted after Bank Indonesia's decision on interest rates.This research uses quantitative research that is event study. Data collection of financial statements at the Investment Gallery of the Indonesia Stock Exchange, University of Muhammadiyah Sidoarjo.The population in this study includes LQ45 companies that have been listed on the Indonesia Stock Exchange, with sampling techniques namely total sampling.Data analysis using T-test. The results of this study prove that there is a difference in the average abnormal return before and after Bank Indonesia's decision on interest rates as evidenced by the value of Sig.(2-tailed) is 0.000 less than 0.005 and there is a difference in average trading volume activity before and after Bank Indonesia's decision on interest rates as evidenced by the value of Sig.(2-tailed) 0.000 less than 0.005.

scholarly journals THE ALBANIAN ECONOMY IN THE STOCK MARKET PERSPECTIVE

2019 ◽  
Vol 31 (1) ◽  
pp. 149-155
Author(s):  
Bajram Lamaj ◽  
Stefan Simeonov
Keyword(s):  
Interest Rates ◽  
Capital Market ◽  
Banking Sector ◽  
Stock Exchange ◽  
Banking System ◽  
Financial System ◽  
Economic Benefits ◽  
Stock Index ◽  
Individual Investors ◽  
The Capital Market

Since the origin of the capitalist economic system, Albania suffers from a shrinking financial system. The financial system lacks what is perhaps the most important and dynamic part in developed economies: a capital market. It is an important element for the country's economic and financial development, as it is a very competitive alternative to the banking sector, reducing intermediation costs for businesses and all economic operators by enabling cheaper alternatives to fund the activity. Today, the banking system has almost exhausted opportunities to be a business financing promoter. And this is the stage where the Albanian economy has come to. Businesses cannot meet all the financing needs of the banking system, while on the other hand, there are individuals who, at the moment, have little choice of investment of their savings. Interest rates, both for bank deposits and government securities, have already reached an extremely low level and are not at all attractive for individual investors, which makes them look for far more attractive investment alternatives. In this way the scholarship will bring an alternative that individuals can invest savings in shares or other securities of companies that will be interested in trading in Albania thus developing the capital market and taking advantage of all the economic benefits that it brings. In this paper, we will firstly address the concept of the capital market and the elements that shape it as well as its development in Albania. The main purpose of this paper is to identify the problems faced by Tirana's former scholarship, to study the situation and the current opportunities of the Albanian economy to develop this structure of the capital market, namely the stock exchange, and to create a stock index model with which Albania can develop this structure and why not be represented in the regional and international markets.

Impact of Corporate Fraud on Foreign Direct Investment?

2021 ◽  
pp. 148-165
Author(s):  
Radwan Alkebsee ◽  
Gaoliang Tian ◽  
Konstantinos G. Spinthiropoulos ◽  
Eirini Stavropoulou ◽  
Anastasios Konstantinidis
Keyword(s):  
Foreign Direct Investment ◽  
Foreign Investment ◽  
Capital Market ◽  
Direct Investment ◽  
Corporate Fraud ◽  
Foreign Investors ◽  
Negatively Associated ◽  
Listed Firms ◽  
Using Data ◽  
The Impact

The capital market reputation attracts foreign investment. Corporate fraud phenomenon is one of the most crucial aspects that threaten foreign investors. This study investigates the impact of corporate fraud on foreign direct investment FDI. Using data of Chinese listed firms, over the period 2009 to 2017, the results show that corporate fraud is negatively associated with foreign direct investment. This suggests that corporate fraud declines foreign shareholders ratio, and foreign investors avoid investing in a risky environment where their wealth may be expropriated. Further, we explore the impact of having foreign shareholders on corporate fraud. We find that increasing foreign shareholders may help in curbing corporate fraud due to diversified corporate experience and risk-taking behavior. However, the findings remain robust after controlling for the potential endogeneity problem. Our findings have important implications for policymakers and governments as it shows that corporate fraud is a crucial determinant to the cause of foreign direct investment.

scholarly journals Pasar Modal dan Penanaman Modal Asing di Indonesia

2021 ◽  
Vol 4 (2) ◽  
pp. 477-484
Author(s):  
Poppy Camenia Jamil ◽  
Restu Hayati
Keyword(s):  
Foreign Investment ◽  
Capital Market ◽  
Stock Price ◽  
Stock Exchange ◽  
Stock Index ◽  
Economic Activities ◽  
Investment Capital ◽  
The Relationship ◽  
The Capital Market

The role of the capital market for the economy of a country according to capital market education by PT. There are two functions of the Indonesia Stock Exchange, namely as a means of business funding or as a means for companies to obtain funds from investors (investors) for business development, expansion, additional working capital and others. This study aims to explain the relationship between the capital market and foreign investment in Indonesia. The variables used in this study are the return of the Composite Stock Price Index (IHSG) and Foreign Direct Investment (FDI) from 2003 to 2019. Data analysis techniques use regression analysis to explain the relationship between the capital market and foreign investment in Indonesia. Indonesia. The final results of the achievements in this study are to increase literacy understanding about economic activities, capital markets, investment to contribute to economic growth.  Keywords: IHSG, FDI, Investment, Capital Market, Stock Index.

scholarly journals Deregulasi Bursa Efek Jakarta, 1987—1997

2018 ◽  
Vol 12 (2) ◽  
pp. 179
Author(s):  
Suparjo Rohman
Keyword(s):  
Capital Markets ◽  
Capital Market ◽  
Stock Exchange ◽  
Foreign Investors ◽  
Long Period ◽  
The Government ◽  
Set Up ◽  
The Impact

This paper discussed about deregulations in Jakarta Stock Exchange on periods 1987-1997 that used history method, that comprise with heuristic, critic, interpretation, and historiography. The purposes about this research are to know historicalback ground and the impacts of government’s deregulations toward Jakarta Stock Exchange in 1987 until 1997. The Jakarta Stock Exchange that has activated by Soeharto’s Era have purposes to create equity distribution income. In efforts to achieve this goal, the government set up some rules about capital markets. In practice, these rules caused the Jakarta Stock Exchange experienced a decline. To solve the causeds, the government make deregulation of capital market. Deregulation aimed to eliminating overly burdensome regulation of capital markets. The Deregulation of capital markets is Paket Desember 1987, Paket Desember 1988, SK Menteri Keuangan No. 1055/KMK.013/1989 and S.K. Menteri Keuangan No. 1548/KMK.013/1990. The impact of deregulation, Jakarta Stock Exchange experienced a boom in 1987-1989. In the long-period impact, Jakarta Stock Exchange is open for foreign investors and then subjected to privatization.

scholarly journals ANALISIS TANGGUNG JAWAB HUKUM TERHADAP TINDAK PIDANA MANIPULASI PASAR DAN PERLINDUNGAN HUKUM BAGI INVESTOR MINORITAS STUDI KASUS:POSA

2021 ◽  
Vol 5 (2) ◽  
Author(s):  
Hasna Kharimah Septiana
Keyword(s):  
Capital Market ◽  
Stock Prices ◽  
Financial Services ◽  
Stock Exchange ◽  
Legal Protection ◽  
Secondary Data ◽  
Market Manipulation ◽  
Literature Study ◽  
The Impact ◽  
The Capital Market

This article aims to analyze the legal protection for investors is related to the practice of market manipulation as regulated in Law Number 8 of 1995 concerning the Capital Market and what forms of legal protection are provided by the Financial Services Authority (OJK), Indonesia Stock Exchange (BEI), KSEI and KPEI as well as the impact of market manipulation and how the accountability will be imposed on the actors.This article uses a normative juridical legal research method. The normative juridical character is carried out by examining secondary data or by the method of literature study of legal materials which are the reference for research, which is focused on examining the application of rules or norms in positive law. The research was carried out by means of a literature study of the laws and regulations related to market manipulation in the capital market sector.The case study in this research is the alleged case of market manipulation conducted by PT Bliss Property Indonesia Tbk (POSA) which occurred on May 10th, 2019, allegedly taking action to manipulate the market so that there are drastic fluctuations in the movement of stock prices out of the ordinary and without accompanied by clear fundamentals of the company, it is suspected that this trade is not fair so that it harms one of the investors

Formal Models of International Political Economy

2021 ◽  
Author(s):  
Leslie Johns
Keyword(s):  
Political Economy ◽  
International Trade ◽  
Foreign Investment ◽  
International Political Economy ◽  
Future Research ◽  
Formal Models ◽  
Foreign Investors ◽  
Research Questions

This chapter examines how scholars use formal models to study International Political Economy (IPE). This small, but important, body of research revolves around three substantive research questions. First, scholars have asked: how do states promote international trade by reducing tariffs and non-tariff barriers? Second, they ask: how do states encourage foreign investment by making binding pledges to protect foreign investors? Finally, scholars have studied: how do states stabilize and grow their economies? For each of these topics, the chapter looks back at past findings from formal models. It then discusses how IPE scholars can profitably move forward in their future research on these important topics.

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