scholarly journals Inter-cohort wealth development in Finland, 1987–2016

2020 ◽  
Author(s):  
Esa Karonen ◽  
Mikko Niemelä
Keyword(s):  
Financial Markets ◽  
Annual Variation ◽  
Wealth Inequality ◽  
Financial Assets ◽  
Financial Wealth ◽  
Interaction Terms ◽  
New Finding ◽  
Household Assets ◽  
Cohort Groups ◽  
Over Time

This article examines inter-cohort wealth development in Finland during the period 1987–2016. As previous research has stated that annual variation has increased over time, we aim toimprove previous research by focusing on gross, net, and financial wealth gaps betweencohorts. The opening of the Finnish financial markets and the introduction of new types ofinvestment instruments since the late 1980s created entirely new circumstances for businessand financial markets. We utilise the time series of the Official Statistics of Finland’s (OFS)Household Assets. We use the marginal effects method with a generalised linear model (GLM),and interaction terms. The results show that inter-cohort wealth inequality in gross- and netwealth has not increased over time, and all differences are attributed to within-year variations.As a new finding, financial wealth shows variations among three distinct investment groups,and higher investment interest can be associated with decreasing initial investment ages amongyounger cohorts. It seems that younger cohorts embraced new financial instruments much morein early age than did their older counterparts. Overall, the results show that financialderegulation considerably increased investment in financial assets among all cohort groups.

The Thin Line between Economic Dynamism and Social Stability

Capitalisms ◽  
2020 ◽  
pp. 277-305
Author(s):  
Masaki Nakabayashi
Keyword(s):  
Financial Markets ◽  
Financial Market ◽  
Institutional Arrangement ◽  
Wealth Inequality ◽  
Free Competition ◽  
Meiji Restoration ◽  
Medieval Japan ◽  
The Family ◽  
Japanese Capitalism ◽  
Over Time

Free competition in product markets is a common characteristic in capitalist economies. Meanwhile, regulations on the land, labour, and financial markets have changed over time in each capitalist economy and are distinct. We address this issue in the Japanese context. Medieval Japan under the second shogunate of Muromachi in the fourteenth century instituted a free competition regime for land, labour, and financial markets. An outcome was wealth inequality and social destabilization. The third shogunate of Edo vested peasants with property rights and regulated the land, labour, and financial market to maintain them as owner-farmers. The regime created an institutional arrangement where the stem farming family functioned as the centre of resource allocation. Deregulation after the Meiji Restoration of 1868 weakened the family-focused arrangement but did not entirely remove it. Traits of the family-focused arrangement form the specific characteristic of modern Japanese capitalism.

MONEY ILLUSION AND MARKET SURVIVAL

2015 ◽  
Vol 21 (1) ◽  
pp. 1-10
Author(s):  
Roland Eisenhuth
Keyword(s):  
Financial Markets ◽  
Financial Assets ◽  
Rational Agents ◽  
Money Illusion ◽  
Long Run ◽  
Over Time

By studying complete and incomplete dynamic financial markets, I show that if some agents are money-illusioned and neglect inflation, the rational agents who are aware of inflation are driven out of the market in the long run, in the sense that the money-illusioned agents consume the economy's entire endowment. The reason for this finding is that with inflation, the money-illusioned agents always believe that the return on their savings is higher than it actually is. Because these agents trade financial assets in markets with the rational agents, the rational agents end up being borrowers and the money-illusioned agents lenders. Because the rational agents' debt accumulates over time, they become so indebted that the money-illusioned agents eventually consume the economy's entire endowment. If there is deflation, the opposite is true, and the rational agents evolutionarily dominate.

scholarly journals Valuing Peace: The Effects of Financial Market Exposure on Votes and Political Attitudes

Econometrica ◽  
2019 ◽  
Vol 87 (5) ◽  
pp. 1561-1588 ◽  
Author(s):  
Saumitra Jha ◽  
Moses Shayo
Keyword(s):  
Financial Markets ◽  
Financial Market ◽  
Political Attitudes ◽  
Peace Process ◽  
Superior Performance ◽  
Financial Assets ◽  
Material Incentive ◽  
Nonfinancial Information ◽  
Political Messages ◽  
Economic Risks

Can participation in financial markets lead individuals to reevaluate the costs of conflict, change their political attitudes, and even their votes? Prior to the 2015 Israeli elections, we randomly assigned Palestinian and Israeli financial assets to likely voters and incentivized them to actively trade for up to 7 weeks. No political messages or nonfinancial information were included. The treatment systematically shifted vote choices toward parties more supportive of the peace process. This effect is not due to a direct material incentive to vote a particular way. Rather, the treatment reduces opposition to concessions for peace and changes awareness of the broader economic risks of conflict. While participants who were assigned Palestinian assets are more likely to associate their assets' performance with peace, they are less engaged in the experiment. Combined with the superior performance of Israeli stocks during the study period, the ultimate effects of Israeli and Palestinian assets are similar.

Wealth and preferences for redistribution: The effects of financial assets and home equity in 31 countries

2021 ◽  
pp. 002071522098808
Author(s):  
Liza G Steele
Keyword(s):  
Household Wealth ◽  
Welfare States ◽  
Social Effects ◽  
Financial Assets ◽  
Unemployment Benefits ◽  
Home Equity ◽  
Income Equality ◽  
Financial Wealth ◽  
Preferences For Redistribution ◽  
The Social

How does wealth affect preferences for redistribution? In general, social scientists have largely neglected to study the social effects of wealth. This neglect was partially due to a dearth of data on household wealth and social outcomes, and also to greater scholarly interest in how wealth has been accumulated rather than the social effects of wealth. While we would expect household wealth to be an important component of attitudes toward inequality and social welfare policies, research in this area is scarce. In this study, the relationship between wealth and preferences for redistribution is examined in cross-national global and comparative perspective using data on 31 countries from the 2009 wave of the International Social Survey Programme (ISSP), the first wave of that study to include measures of wealth. The findings presented compare the effects of two types of wealth—financial assets and home equity—and demonstrate that there are differences in effects by asset type and by redistributive policy in question. Financial wealth is more closely associated with attitudes about income equality, while home equity is more closely associated with attitudes about unemployment benefits. Moreover, while the upper categories of financial wealth have the largest negative effects on support for income equality, it is the middle categories of home equity that are most strongly associated with opposition to unemployment benefits. Effects also differ by country, but not in patterns that theories of comparative welfare states nor political economy would adequately explain.

scholarly journals Differences in risk perception, knowledge and protective behaviour regarding COVID-19 by education level among women and men in Germany. Results from the COVID-19 Snapshot Monitoring (COSMO) study

PLoS ONE ◽  
2021 ◽  
Vol 16 (5) ◽  
pp. e0251694
Author(s):  
Petra Rattay ◽  
Niels Michalski ◽  
Olga Maria Domanska ◽  
Anna Kaltwasser ◽  
Freia De Bock ◽  
...  
Keyword(s):  
Risk Perception ◽  
Education Level ◽  
Factual Knowledge ◽  
Perceived Severity ◽  
Highly Educated ◽  
Interaction Terms ◽  
Protective Behaviour ◽  
Low Education ◽  
The Impact ◽  
Over Time

The main strategy for combatting SARS-CoV-2 infections in 2020 consisted of behavioural regulations including contact reduction, maintaining distance, hand hygiene, and mask wearing. COVID-19-related risk perception and knowledge may influence protective behaviour, and education could be an important determinant. The current study investigated differences by education level in risk perception, knowledge and protective behaviour regarding COVID-19 in Germany, exploring the development of the pandemic over time. The COVID-19 Snapshot Monitoring study is a repeated cross-sectional online survey conducted during the pandemic in Germany from 3 March 2020 (waves 1–28: 27,957 participants aged 18–74). Differences in risk perception, knowledge and protective behaviour according to education level (high versus low) were analysed using linear and logistic regression. Time trends were accounted for by interaction terms for education level and calendar week. Regarding protective behaviour, interaction terms were tested for all risk perception and knowledge variables with education level. The strongest associations with education level were evident for perceived and factual knowledge regarding COVID-19. Moreover, associations were found between low education level and higher perceived severity, and between low education level and lower perceived probability. Highly educated men were more worried about COVID-19 than those with low levels of education. No educational differences were observed for perceived susceptibility or fear. Higher compliance with hand washing was found in highly educated women, and higher compliance with maintaining distance was found in highly educated men. Regarding maintaining distance, the impact of perceived severity differed between education groups. In men, significant moderation effects of education level on the association between factual knowledge and all three protective behaviours were found. During the pandemic, risk perception and protective behaviour varied greatly over time. Overall, differences by education level were relatively small. For risk communication, reaching all population groups irrespective of education level is critical.

scholarly journals Wealth of nomads – an exploratory analysis of livestock inequality in the Saami reindeer husbandry

2021 ◽  
Author(s):  
Marius Warg Næss ◽  
Bård-Jørgen Bårdsen
Keyword(s):  
Primary Source ◽  
Wealth Inequality ◽  
External Factors ◽  
Social Differentiation ◽  
Reindeer Herding ◽  
Reindeer Husbandry ◽  
The Poor ◽  
Wealth Inequalities ◽  
Rank Differences ◽  
Over Time

Social inequality is pervasive in contemporary human societies. Nevertheless, there is a view that livestock, as the primary source of wealth, limits the development of inequalities, making pastoralism unable to support complex or hierarchical organisations. Thus, complex nomadic pastoral organisation is predominantly caused by external factors, i.e., historically nomadic political organisation mirrored the neighbouring sedentary population's sophistication. Using governmental statistics on reindeer herding in Norway (2001 - 2018), this study demonstrates nothing apparent in the pastoral adaptation with livestock as the main base of wealth that level wealth inequalities and limits social differentiation. This study found that inequality was generally decreasing in terms of the Gini coefficient and cumulative wealth. For example, the proportion owned by the wealthy decreased from 2001 to 2018, while the proportion owned by the poor increased. Nevertheless, rank differences persist over time with minor changes. Especially, being poor is stable: around 50% of households ranked as poor in 2001 continued to be so in 2018. In sum, results from this study indicate that pastoral wealth inequality follows the same patterns as all forms of wealth. Wealth accumulates over time, and because the highest earners can save much of their income (i.e., newborn livestock), low earners cannot. High earners can thus accumulate more and more wealth over time, leading to considerable wealth inequalities.

scholarly journals Do Cash Holdings Differ in Europe and Asia Pacific?

2019 ◽  
Vol 7 (2) ◽  
pp. 1-32
Author(s):  
Ummar Aftab ◽  
Waseem Akhter Qureshi ◽  
Attiya Yasmin Javid
Keyword(s):  
Financial Markets ◽  
Cash Holdings ◽  
Cash Flows ◽  
Negative Influence ◽  
Asia Pacific ◽  
Cash Holding ◽  
Financial Assets ◽  
Dividend Payment ◽  
Financial Strength ◽  
Cash Reserves

This paper identifies the determinants that contribute towards the variation in financial assets that make up a firm’s total cash reserves, specifically in two important regions of the world i.e. Asia Pacific and Europe. The findings of the research reveal that firms in the region of Asia Pacific have slightly higher cash holdings, as compared to firms in Europe. Moreover, the study also identifies that the elevated cash holdings in Asia Pacific are not a result of the agency problem, as is generally viewed, rather, the shareholder power hypothesis is a more appropriate measure to elucidate this elevation in the level of cash holdings in the region. When shedding light on to the firm specific cash holding determinants, the findings of the research reveal that leverage, dividend payment, profitability, growth and net working capital, cash flows and financial strength, influence cash reserves in both the regions, exactly in the same manner. This shows the application of transaction, and precautionary motives in both the regions. The study further identifies that size, and investments have a varying effect in both the regions that are taken into consideration. Again, this difference may be attributed to Shareholders’ Power Hypothesis, specifically for Asia Pacific and the Agency View, specifically for Europe. Shareholders’ Right Index influences cash reserves in Asia Pacific in a positive manner, while in Europe, the same index shows a negative influence. The development in the financial markets has a negative negatively influence on cash holdings in Asia Pacific, and a positive one in Europe.

scholarly journals Monetary Policy Surprises over Time

2018 ◽  
Vol 08 (01) ◽  
pp. 1840002 ◽  
Author(s):  
Marcello Pericoli ◽  
Giovanni Veronese
Keyword(s):  
Monetary Policy ◽  
Financial Markets ◽  
Interest Rates ◽  
Euro Area ◽  
Yield Curve ◽  
Sovereign Spreads ◽  
Definition Of ◽  
Term Premia ◽  
The Impact ◽  
Over Time

We document how the impact of monetary surprises on euro-area and US financial markets has changed from 1999 to date. We use a definition of monetary policy surprises, which singles out movements in the long-end of the yield curve — rather than those changing nearby futures on the central bank reference rates. By focusing only on this component of monetary policy, our results are more comparable over time. We find a hump-shaped response of the yield curve to monetary policy surprises, both in the pre-crisis period and since 2013. During the crisis years, Fed path-surprises, largely through their effect on term premia, account for the impact on interest rates, which is found to be increasing in tenor. In the euro area, the path-surprises reflect the shifts in sovereign spreads, and have a large impact on the entire constellation of interest rates, exchange rates and equity markets.

Fractal Properties of Financial Assets and Forcasting Financial Crisis

2018 ◽  
pp. 23-41 ◽  
Author(s):  
Inna Nekrasova ◽  
Oxana Karnaukhova ◽  
Oleg Sviridov
Keyword(s):  
Fractal Dimension ◽  
Financial Markets ◽  
Future Development ◽  
Small Time ◽  
Practical Significance ◽  
Financial Assets ◽  
Time Intervals ◽  
Price Fluctuations ◽  
Fractal Properties ◽  
Fractal Index

The chapter is aimed at identification of criteria to select financial assets for investment; observing price fluctuations at small time intervals (up to one week) as possible predictors of the future of a significant increase in the price fluctuations amplitude; determining a fractal dimension of the financial markets on the basis of R/S-analysis; constructing a fractal index indicator to identify a bifurcation point, which gives birth to a possibility of crisis phenomena in economy. Therefore, the practical significance of the chapter lies in the idea of equipping academics and practitioners with new methods and tools for analysis and forecasting future development and dynamics of the financial markets.

Financial markets as commensurating machines

2019 ◽  
Vol 58 (4) ◽  
pp. 539-565
Author(s):  
Barbara Kuchler
Keyword(s):  
Financial Markets ◽  
Capital Markets ◽  
Capital Market ◽  
Capital Flows ◽  
Financial System ◽  
Financial Assets ◽  
Financial Instruments ◽  
Black Scholes ◽  
Derivatives Markets

Ever since the crisis of 2008, the dynamism and self-referentiality of financial markets have puzzled observers. This article argues that this dynamism is the product of a long process of commensuration, by which ever more heterogeneous financial assets and financial instruments have come to be compared with, substituted for, and valuated relatively to one another, and have thereby been condensed into a highly interconnected financial system. This trajectory can be found both in the long-term historical emergence of financial markets from ancient origins and in the more recent transformations of the financial system since the 1970s, including (i) the rise of derivatives markets, and (ii) the rise of capital markets as against bank-intermediated capital flows. The rise of derivatives markets was triggered by the commensuration of basic securities (such as stock, bond) and derivatives (such as options, futures), established by the Black-Scholes-Merton theory of option pricing. The rise of capital markets was rooted in the commensuration – and hence, competition and substitution – of bank products (such as loans, deposits) and non-bank products (capital market securities).

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