Economic and Financial Consequences of Pandemics

This paper studies the medium-term economic consequences of major pandemics since 1870. The paper compares the average path of economic and financial indicators after a pandemic with their long-term path. According to data, inflation is low over the decade that follows the end of a major pandemic. Investments drive the rebound in real GDP. Financial assets provide above-average real returns. Credit markets experience a boom while fiscal and monetary authorities cutback government expenditure and money supply after pandemics.

Household Wealth: Low-Yielding and Poorly Structured?

In this paper, we present a newly generated data set on real returns of households’ aggregated asset holdings, which adds additional and more sophisticated information to existing relevant datasets in the literature. To do this, we draw on various datasets from public and private sources and then transform and combine them in a consistent manner that allows for international comparative and intertemporal analyses. Based on this, we address two current debates on the development of household wealth in the euro area that have been triggered by the low-interest environment. The first debate refers to the development of real yields on household wealth from 2000 to 2018, whereas the second debate deals with the mean-variance efficiency of household portfolios. Contrary to widespread belief, we find that yields on total wealth, which were largely dominated by non-financial assets’ yields, were mostly positive, although they exhibit a declining trend. Moreover, on average, overall real yields were significantly lower after 2008. Referring to portfolio efficiency, we find that current portfolios seem to be comparatively close to mean-variance efficiency. If households were to optimize their portfolios despite limited room for improvement, holdings of equity and investment fund shares should be reduced, contradicting common recommendations of financial advisors.

Optimization of the Legal Regulation of Credit Operations in the Conditions of Digitization: Issues and Development Prospects

The subject of the research is the current Russian legislation regulating lending activities in the context of the implementation of the national project “Digital Economy”. The purpose of the article is to establish functioning legal opportunities to reduce debt load and to identify directions for optimizing national legislation governing the provision of credit products. To effectively impact digital transformation on lending, the focus should be on developing a new mindset to make the best use of technology, motivate people and streamline processes. It is financial institutions that create a collaborative and innovative culture to drive change that can deliver real returns on their technology investments in banking. Conclusions are formulated that there is a need for regulatory regulation of online lending, the introduction of digital credit platforms, and the development of credit and digital culture of the population. First of all, this concerns amendments to the law “On banks and banking activities” on the provision of digital credit. In addition, with the adoption in 2020 of the Federal Law “On Digital Financial Assets, Digital Currency and Amendments to Certain Legislative Acts of the Russian Federation”, it is required to bring the regulations of the Bank of Russia on the possibility of lending against digital financial assets and digital currency in line with the current legislation.

Long-run inflation expectations in the ECB survey of professional forecasters: what do the survey responses tell us?

Research background: At the background, there are issues related to policy credibility and policy targets. For these issues, long-term forecasts can provide important information. Of course, long-term forecasts are needed also e.g. for evaluation of real returns. Purpose of the article: This paper tries to find out how informative the ECB Survey of Professional Forecasters data on long-term inflation prospects are from the point of view of the overall quality of the survey and on the other hand from the point of view of monetary policy credibility. Methods: The analysis makes use of individual forecaster level quarterly panel data for the period 1999Q1?2018Q4. Conventional panel econometrics tools are used to find out whether forecasts are sensitive to changes in actual inflation and other relevant variables. Findings & Value added: We find some weaknesses considering the size of the survey, the selection of the sample (more precisely the participation to the survey) and the inertial responses of forecasters which suggest that the survey values are not actively updated. Moreover, we find that towards the end of the sample period, the survey values are related to actual inflation and to short-term expectations, which is not consistent with the credibility of the official inflation target.

The inflation hedging capacity of Islamic and conventional equities

PurposeThis study analyzes the inflation hedging of Islamic and conventional equities by employing 26 indices for the period ranging from January 1996 till August 2018. The authors investigate the decoupling hypothesis for Islamic versus conventional equities across various investment horizons.Design/methodology/approachThe authors employ a vector autoregressive framework coupled with bootstrapping procedure to compute inflation hedging measures. The hedging measures employed account for the inflation hedging capacity in terms of hedging effectiveness as well as the cost of hedging (efficiency). The authors account for various investment horizons ranging from one month to ten years.FindingsAlthough, the authors do not find consistent evidence for the decoupling hypothesis of Islamic and conventional equities in terms of their inflation hedging capacity. However, the authors document that certain Islamic equity indices can be employed to effectively hedge against the risk of inflation.Originality/valueThe main contribution of this study is that the existing literature on the comparative performance of Islamic versus conventional equities against inflation risk is sparse. The purpose of this study is to analyze the inflation hedging attributes of Islamic versus conventional equities, that is, whether Islamic equities render better real returns than their conventional counterparts. It will contribute to the growing literature on the comparison between Islamic and conventional equities by documenting the real return attributes of these two, apparently different, assets. A further contribution is that in order to account for the different investment horizons for different types of investors, this study will quantify the real return attributes of Islamic and conventional equities for short-, medium- and long-term investors.

Analytical Study on Crop Status and Farmers’ Preference towards Crop Varieties and Hybrids in Namakkal District of Tamil Nadu

Tamil Nadu is one of the pioneer states in India, which is Farmer centric and has brought revolutionary initiatives in Agriculture to propel the productivity and production of major crops. The use of good quality seeds of improved high yielding varieties and hybrids is the master key for productive agriculture. Hence, the study was taken up in Namakkal district with an aim to assess the preference of using the varieties and hybrids and to identify the constraints of in adopting it. In Namakkal district, Thiruchengode block was purposively selected based onarea of cultivation. A sample of 30 respondents were selected using simple random sampling method and Participatory Rural Appraisal method was used for data collection. Percentage analysis and Cumulative frequency methods were used for data analysis. The study revealed that, the most of the farmers cultivated varieties like Sorghum (CO 30), Ragi (GPU 28), Blackgram (Vamban 4), Greengram (Vamban 2), Groundnut (TMV 7), Tapioca (MVD 1), Pomegrante (Bhagawa), Guava (Lucknow 49).The preferences expressed by the farmers for cultivating the above mentioned varieties and hybrids were high yield, highly suitable for all season, drought tolerant and less water consumption. In general, the farmers faced few constraints like, lack of awareness and knowledge about recent varieties, hybrids and technologies, monsoon failure, high labour cost, dry land area, lack of storage go-down facilities and farmers are not getting real returns of the crops due to climatic factor.

Analisis Kinerja Reksa Dana Pendapatan Tetap, Reksa Dana Saham, dan Reksa Dana Campuran (Studi Di Bursa Efek Indonesia – BEI)

This study aims to determine the differentiation of the performance of fixed income mutual funds, equity mutual funds, and mix mutual funds of aspects of real returns. Studies conducted in the Indonesia Stock Exchange – IDX for longitudinal data in 2013 at the condition of macroeconomic weakened by indications the high inflation rate, followed by the increase in the BI rate, the weakening of the rupiah on the US Dollar, and the issue of debt Cailing and tapering off planned by the FED, Data were analyzed descriptively and hypothesis was tested by Kruskal Wallis k-samples. The analysis showed that the performance of equity mutual funds posted positive results and relatively higher than mix mutual fund, while fixed income mutual funds recorded a negative result but thin adrift of the two other mutual funds. However, statistically at 95% confidence interval, performance fixed income mutual funds, equity mutual funds, and mix mutual funds of aspects of the real return is not significantly different, where the average performance of the three mutual funds are under Composite Stock Price Index.Keywords: performance; mutual funds; real return.