Critical Analysis of the World Economy and Deglobalization Processes in Times of Pandemic

This chapter aims to critically analyze both the world economy and the deglobalization processes under the assumption that they are the result of a dialectical evolution of economic, financial, political, and sanitary crises. This dialectical movement of the history of the globalization and deglobalization processes is always a very complex phenomena of interactions between the economic agents and political actors, leading to both progressive and regressive events of economic growth, social development, and environmental sustainability. After a period of intensive economic, trade, and financial integration in the creation of a world economy system, suddenly the economic, financial, and sanitary dysfunctionalities emerged at the interior and created a reactive deglobalization process. However, what has been at the center are the international cooperation and trade relations determined by the need to expand the possibilities of satisfying human needs, including culture.

Exporting Without Direct Access to International Markets

In the literature on exports, the question of why some firms decide to export and why others decide to focus on the domestic market has only received fragmented and different answers. The only overemphasized factor, productivity, seems to be a dead end when empirical evidence is given for high productivity firms which decide to remain in the domestic market. This is mainly due to the ignorance of the role of the firm in international trade by the majority of the literature. In this empirical research, the aim of the author is to test the impact of legal, institutional, and financial conditions on the firm decision to export based on the Enterprise Survey by the World Bank for the Turkish Cypriot people, which remained out of the international community for 57 years, where Turkey emerged as its access point to international markets. Hence, the study contributes to the existing literature on export development by highlighting the obstacles in front of the export decisions of firms and addressing a hitherto not addressed case in international economics.

How the Global Financial Crisis and International Trade Affected Corporate Decisions?

This chapter, first, draws an overview of the theoretical and conceptual framework of corporate decisions in the global financial crisis (GFC) context. Then, it shows the connectedness of corporate finance and international trade. Finally, employing a rich dataset, this chapter assesses the impact of international trade as well as the GFC on corporate financial decisions, particularly cash holdings, debt financing, and dividend payouts over the period 2002-2016. The findings show that international trade significantly affects corporate decisions. Firms with higher trade countries have higher debt level but lower cash and dividends across the globe. During the GFC, the positive impact of trade on debt shifts to negative. Also, trade has a positive effect on both cash and debt in the aftermath of the GFC. Taken together, international trade as an institutional setting influences corporate decisions and its role on cash, debt, and dividend differ during and after the GFC.

Economic Crisis and Its Effects on International Trade

The aim of this chapter is to analyse the effects of the economic crisis on the trade among the Southeastern European (SEE) countries. The countries were divided into two groups: the EU countries and non-EU countries. Macroeconomic performances and international trade indicators of the 11 observed countries were analysed for the period 2007-2019, and the effects of the economic crisis were present in all the observed countries, particularly the effects on the export performances. The crisis also affected the entire import of the non-EU countries. The EU countries recovered from the crisis faster than the non-EU countries. However, the non-EU countries achieved a more significant inflow of foreign direct investment in the post-crisis period, which significantly improved the position of the balance of payments in these countries. The observed countries had managed to stabilise their trade flows all until the beginning of the COVID-19 crisis. The impact of the current crisis on these countries remains to be estimated in the future.

COVID-19, Stock Market, Exchange Rate, Oil Prices, Unemployment, Inflation, Geopolitical Risk Nexus, the Case of the BRICS Nations

This chapter attempts to study the impact of the COVID-19 pandemic on the stock markets of the BRICS nations. Such an exercise will have an important bearing on portfolio allocation in the context of the BRICS. The major contribution of the chapter in the extant literature is to examine based on the multifactor model of the capital asset pricing theory, how uncertainty owing to the pandemic interplay with the geopolitical index to impact the stock market of the BRICS. Further, the major macroeconomic factors are used as control variables. The daily observations were used from 31 December 2019 to 30 December 2020. The results based on the quantile regression model demonstrate the asymmetric response of the stock market to the pandemic. The policy implication that follows from this study is the need for strategic intervention of the central bank to ease the liquidity challenges in the crisis period.

The Future of Trade Fairs After the COVID-19 Pandemic

Globalization has made the whole world a common market for businesses by removing the commercial borders between countries. Increased competition in the global market has pushed businesses that want to operate in this arena to implement new strategies. As a promotion activity, fairs have been the most important assistant of the companies that want to internationalize over the years. Although the concept of fair organizations has changed with the effect of digitalization in the historical process, fairs still continue their main function of bringing buyers and sellers together. The subject of this chapter is how virtual fairs, which have increased their importance in marketing activities with the pandemic, will affect the future of trade fairs. In this context, the history of the fairs, their place and importance in international marketing, virtual fairs, and the impact of the COVID-19 pandemic on the future of international fairs will be discussed.

The Effect of COVID-19 on the Spanish Wine Industry

The Spanish wine sector has not remained unaffected by the impact of COVID-19. This research aims to analyse the impact of COVID-19 on the Spanish wine sector, quantifying a phenomenon on which there is no academic literature, because although the impact of the pandemic on the wine sector has been studied at a general level, it has not been analysed in the Spanish case. An exploratory approach was adopted for the research in order to analyse the behaviour of the variables that measure the degree of commercialisation of Spanish wine in both the domestic and foreign markets. In addition, the research gathers and quantifies the measures carried out by the Spanish government to help the wine sector overcome the current crisis.

Financial Fragility and Its Impacts on International Trade and Economic Growth

International trade cannot be considered separate from the current financial system in the context of imports and exports. In this context, the impact on international trade should be analyzed under the financial fragility hypothesis. This chapter aims to analyze the effects of financial fragility on Fragile Five and Troubled Ten countries' economic growth and trade strategies. In this direction, long-term relationships between variables are analyzed by Westerlund panel cointegration tests. According to the result of the panel cointegration tests, there are long-term relationships between exports, imports, gross domestic product, and financial fragility index. After determining the long-term relationships between variables, causality analyses have been carried out to reveal the direction of these relationships. According to Dumitrescu-Hurlin panel causality test results, there are bidirectional causality relationships between financial fragility index and export, import, and gross domestic product.

Pacific Alliance Facing Crises

The Pacific Alliance (PA) is an integration process that projects the commercial exchange of value-added products for its members. However, the external and internal crises have made the PA a volatile region in social and economic terms. This chapter analyzes the economic and trade policy trends in PA countries since 1990 and how they faced the different world and regional economic crises. From the particular analysis of the countries, there are similarities and differences in trade trends and the way to control crises. This chapter provides a general framework to review more specific approaches by sectors, industries, and companies.

Critical Analysis of the Relocation Strategy of Production Between National Protectionist Policies and Global Supply and Value Chains

This chapter aims to critically analyze the implications that the national protectionist policies have on the global supply and value chains and the relocation of production. The analysis is based on the assumptions that the global economy is facing the possibility of decoupling of many trade connections, and this trend favors deglobalization processes long promoted by populism, nationalism, and economic protectionism. It is concluded that global supply, production, and value chains, although being economically efficient, are no longer any more secure under national protectionist policies, and therefore, the relocation of production processes is mainly due to the increase in the level of income and wages of the developing countries that are the destination and which reduce the advantages to relocate.