scholarly journals Post Financial Crisis and Macroeconomic Fundamentals on Household Debt in Advanced Economies

2017 ◽  
Vol 2 (3) ◽  
pp. 36-41
Author(s):  
Siti Aminah Mainal ◽  
Catherine S F Ho ◽  
Jamaliah Mohd Yusof
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Panel Data Analysis ◽  
Control Variable ◽  
Housing Price ◽  
Household Debt ◽  
Macroeconomic Factors ◽  
Crisis Period ◽  
Advanced Economies ◽  
Macroeconomic Fundamentals

Objective - The unwarranted household debt initiated the global financial crisis which led to severe worldwide financial instability. Deleveraging process which has been taking place since the crisis has been slow and there is no quick fix to the debt issue. The lack of study on the effect of financial crisis on household debt justifies the objective to investigate macroeconomic fundamentals and financial crisis on household debt. Methodology/Technique - This study applies panel data analysis in ten advanced economies from 2001 to 2013. The random effect (RE) generalized least square estimator is used in the regression to examine macroeconomic factors and post financial crisis period as control variable on household debt. Findings - Findings confirm that post financial crisis period has significant negative effect on household debt which affirmed the deleveraging process in most advanced economies. Economic growth and household disposable income too have negative relation with household debt. Nonetheless, macroeconomic factors such as inflation, housing price and household consumption encourage household debt in advanced economies. Novelty - This study suggests that empirical evidence support that household avert from borrowing post financial crisis. Intensification of housing price and other consumption expenditure, if left unrestrained, may elicit another debt crisis. These are challenges faced by policy makers to curb household debt which entail risks for households, the financial system and the wider economy. Type of Paper: Empirical Keywords: Household Debt; Post Financial Crisis; Macroeconomic Factors. JEL Classification: G01, G02.

Conclusions

2017 ◽  
Author(s):  
Yilmaz Akyüz
Keyword(s):  
Monetary Policy ◽  
Financial Crisis ◽  
Interest Rates ◽  
Global Financial Crisis ◽  
Developing Economies ◽  
Quantitative Easing ◽  
Unconventional Monetary Policy ◽  
Advanced Economies ◽  
The Global Financial Crisis ◽  
Zero Bound

The preceding chapters have examined the deepened integration of emerging and developing economies (EDEs) into the international financial system in the new millennium and their changing vulnerabilities to external financial shocks. They have discussed the role that policies in advanced economies played in this process, including those that culminated in the global financial crisis and the unconventional monetary policy of zero-bound interest rates and quantitative easing adopted in response to the crisis, as well as policies in EDEs themselves....

Financialization and state capitalism in Hungary after the Global Financial Crisis

2021 ◽  
pp. 102452942110032
Author(s):  
David Karas
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Emerging Market ◽  
Active Role ◽  
The State ◽  
State Capitalism ◽  
Political Risks ◽  
Role Of The State ◽  
Advanced Economies ◽  
The Global Financial Crisis

Whereas the active role of the state in steering financialization is consensual in advanced economies, the financialization of emerging market economies is usually examined through the prism of dependency: this downplays the domestic political functions of financialization and the agency of the state. With the consolidation of state capitalist regimes in the semi-periphery after the Global Financial Crisis, different interpretations emerged – some linking state capitalism with de-financialization, others with coercive projects deepening it. Preferring a more granular and multi-dimensional approach, I analyse how different facets of financialization might represent political risks or opportunities for state capitalist projects: Based on the Hungarian example, I first explain how the constitution of a ‘financial vertical’ after 2010 inaugurated a new mode of statecraft. Second, I show how the financial vertical enabled rentier bargains between state and society after 2015 by deepening the financialization of social policy and housing in response to a looming crisis of competitiveness.

Global financial crisis, ownership structure and firm financial performance

2017 ◽  
Vol 34 (4) ◽  
pp. 447-465 ◽  
Author(s):  
Ali Salman Saleh ◽  
Enver Halili ◽  
Rami Zeitun ◽  
Ruhul Salim
Keyword(s):  
Financial Crisis ◽  
Financial Performance ◽  
Ownership Structure ◽  
Family Firms ◽  
Global Financial Crisis ◽  
Ownership Concentration ◽  
Financial Leverage ◽  
Content Type ◽  
Crisis Period ◽  
The Global Financial Crisis

Purpose This paper aims to investigate the financial performance of listed firms on the Australian Securities Exchange (ASX) over two sample periods (1998-2007 and 2008-2010) before and during the global financial crisis periods. Design/methodology/approach The generalized method of moments (GMM) has been used to examine the relationship between family ownership and a firm’s performance during the financial crisis period, reflecting on the higher risk exposure associated with capital markets. Findings Applying firm-based measures of financial performance (ROA and ROE), the empirical results show that family firms with ownership concentration performed better than nonfamily firms with dispersed ownership structures. The results also show that ownership concentration has a positive and significant impact on family- and nonfamily-owned firms during the crisis period. In addition, financial leverage had a positive and significant effect on the performance of Australian family-owned firms during both periods. However, if the impact of the crisis by sector is taking into account, the financial leverage only becomes significant for the nonmining family firms during the pre-crisis period. The results also reveal that family businesses are risk-averse business organizations. These findings are consistent with the underlying economic theories. Originality/value This paper contributes to the debate whether the ownership structure affects firms’ financial performance such as ROE and ROA during the global financial crisis by investigating family and nonfamily firms listed on the Australian capital market. It also identifies several influential drivers of financial performance in both normal and crisis periods. Given the paucity of studies in the area of family business, the empirical results of this research provide useful information for researchers, practitioners and investors, who are operating in capital markets for family and nonfamily businesses.

Malaysia–US Bilateral Relations in the Aftermath of the 2008 Global Financial Crisis

2016 ◽  
pp. 285-298
Author(s):  
Mas Juliana Mukhtaruddin
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
External Trade ◽  
Department Of State ◽  
Bilateral Relations ◽  
Advanced Economies ◽  
The Us ◽  
The World ◽  
Tangible Evidence ◽  
Visible Effect

Malaysia–United States relations are enormously significant. From the perspective of the US Department of State, Malaysia is a significant player at both the regional and international levels. The world financial crisis that began in the US at the end of 2007 moderately affected the Malaysian economy. While the US was at the center of the crisis, Malaysia felt its effects as one of Asia's export-reliant economies. Regarding the implications of the crisis, some tangible evidence has been evaluated. The fourth quarter of 2008 was devastating for the world's advanced economies, including the US, and Malaysia's external trade-related sectors were severely struck. The primary reason for this visible effect was a disruption in the trade demand. Against this background, this paper examines the aftermath of the world financial crisis on the relations between Kuala Lumpur and Washington, particularly on the political and economic bilateral ties.

Default Option Exercise over the Financial Crisis and beyond*

2020 ◽  
Author(s):  
Xudong An ◽  
Yongheng Deng ◽  
Stuart A Gabriel
Keyword(s):  
Data Analysis ◽  
Panel Data ◽  
Financial Crisis ◽  
Panel Data Analysis ◽  
Mortgage Default ◽  
Time Varying ◽  
Crisis Period ◽  
Default Option ◽  
Run Up ◽  
Mortgage Defaults

Abstract We document changes in borrowers’ sensitivity to negative equity and show heightened borrower default propensity as a fundamental driver of crisis period mortgage defaults. Estimates of a time-varying coefficient competing risk hazard model reveal a marked run-up in the default option beta from 0.2 during 2003–06 to about 1.5 during 2012–13. Simulation of 2006 vintage loan performance shows that the marked upturn in the default option beta resulted in a doubling of mortgage default incidence. Panel data analysis indicates that much of the variation in default option exercise is associated with the local business cycle and consumer distress. Results also indicate elevated default propensities in sand states and among borrowers seeking a crisis-period Home Affordable Modification Program loan modification.

scholarly journals Crisis determination and financial contagion: an analysis of the Hong Kong and Tokyo stock markets using an MSBVAR approach

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Haytem Troug ◽  
Matt Murray
Keyword(s):  
Hong Kong ◽  
Stock Markets ◽  
Global Financial Crisis ◽  
Current Data ◽  
Financial Contagion ◽  
Macroeconomic Factors ◽  
Content Type ◽  
Crisis Period ◽  
Dynamic Relationship ◽  
Using Data

PurposeThe purpose of this paper then, is to add to the existing literature on financial contagion. While a vast amount of the debate has been made using data from the late 1990s, this paper differentiates itself by analysing more current data, centred around the most recent global financial crisis, with specific focus on the stock markets of Hong Kong and Tokyo.Design/methodology/approachEmploying Pearson and Spearman correlation measures, the dynamic relationship of the two markets is determined over tranquil and crisis periods, as specified by an Markov-Switching Bayesian Vector AutoRegression (MSBVAR) model.FindingsThe authors find evidence in support of the existence of financial contagion (defined as an increase in correlation during a crisis period) for all frequencies of data analysed. This contagion is greatest when examining lower-frequency data. Additionally, there is also weaker evidence in some data sub-samples to support “herding” behaviour, whereby higher market correlations persist, following a crisis period.Research limitations/implicationsThe intention of this paper was not to analyse the cause or transmission mechanism of contagion between financial markets. Therefore future studies could extend the methodology used in this paper by including exogenous macroeconomic factors in the MSBVAR model.Originality/valueThe results of this paper serve to explain why the debate of the persistence and in fact existence of financial contagion remains alive. The authors have shown that the frequency of a time series dataset has a significant impact on the level of observed correlation and thus observation of financial contagion.

scholarly journals Determinants of the Long-Term Correlation between Crude Oil and Stock Markets

Energies ◽  
2019 ◽  
Vol 12 (21) ◽  
pp. 4123 ◽  
Author(s):  
Lu Yang ◽  
Lei Yang ◽  
Kung-Cheng Ho ◽  
Shigeyuki Hamori
Keyword(s):  
Crude Oil ◽  
Stock Markets ◽  
Global Financial Crisis ◽  
Debt Crisis ◽  
Panel Data Analysis ◽  
Mixed Data ◽  
Data Sampling ◽  
Conditional Correlation ◽  
Macroeconomic Factors

This study employed a dynamic conditional correlation–mixed-data sampling (DCC–MIDAS) approach and panel data analysis to examine the factors that influence the long-term correlation between crude oil and stock markets. Our study shows that there is a positive long-term conditional correlation between oil prices and stock markets, except during the 2008 global financial crisis and the 2011 European debt crisis. We also found that macroeconomic factors have a significant impact on this correlation. Specifically, risk-free rate has a positive effect, whereas economic activity and credit risk has a negative effect. Our results provide useful information for investors and monetary authorities.

scholarly journals The social orientations and ideologies of UK finance employees at the onset of the Global Financial Crisis

2016 ◽  
Vol 41 (2) ◽  
pp. 239-261 ◽  
Author(s):  
Andreas Cebulla
Keyword(s):  
Financial Crisis ◽  
Financial Services ◽  
Global Financial Crisis ◽  
Panel Data Analysis ◽  
The United Kingdom ◽  
The Social ◽  
Management Positions ◽  
Behavioural Factors ◽  
The Global Financial Crisis ◽  
Economic Fairness

Debates about the Global Financial Crisis of 2007 have pointed at institutional and individual-behavioural factors as its causes. Using the British Household Panel Survey, this article highlights marked differences in perceptions of societal and economic fairness among financial services employees in investment or management positions in the United Kingdom and the general working population at the brink of the Global Financial Crisis. Panel data analysis suggests that financial services and occupations did not necessarily attract employees with pro-market attitudes, but that employment in these institutions and occupations made it more likely that employees came to display these perceptions, contributing to the construction of a distinct attitudinal profile of finance employees.

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