Isolating the female agency‑driven development factor in external sovereign emerging market debt

The underlying literature hypothesises and provides randomised evidence for the positive impact of promoting the broad-based inclusion,empowerment,and representation of women on regional ecosystems.This study seeks to isolate a female agencydriven development factor in external sovereign emerging market debt and finds evidence for superior risk-adjusted returns from tilting towards female agency leaders.We propose the female agency factor as an additional scope in the modern investor’s toolbox of holistic credit assessment,allowing investors to isolate the issuers which are the most effective sovereign transmission mechanisms of sustainable development capital.This contribution to the corpus supports the notion of integrating sustainability factors into portfolio construction and reinforces the argument for supporting femaleled development from a financial markets’perspective.

Governing the gold rush into emerging markets: a case study of Indonesia’s regulatory responses to the expansion of Chinese-backed online P2P lending

Peer-to-peer(P2P)lending has the potential to boost financial inclusion in emerging markets.This paper contributes to the literature on fintech governance in emerging Asian markets.It examines the case of the Indonesian government’s approach in regulating the P2P lending sector using both primary interviews and secondary firmlevel data.Driven by regulation tightening in China and regulatory gaps in Indonesia,Chinese investments became the largest in this sector contributing,however,to growing risks from illegal business practices.The Indonesian government responded by creating new regulations and institutions,mitigating risks without stifling the potential for financial inclusion.We conclude a proactive approach towards monitoring and regulating emerging high-tech industries should be sought by strengthening links with industry and civil society,and through international cooperation for policy and knowledge sharing.

The 2007-2009 Financial Crisis on Emerging Markets： Quantitative Identification of Crisis in Continent-based Regions

This paper focuses on a direct quantitative identification of crisis periods in selected emerging stock markets from four continent-based regions of Europe, Latin America, East Asia, and Middle East and North Africa （MENA）, in the context of an influence of the 2007 U.S. subprime financial crisis. The 17 emerging stock markets and, for comparison, the U.S. stock market are investigated. A statistical method of dividing market states into bullish and bearish markets, based on monthly logarithmic returns of major stock market indexes, is employed. The analyzed sample period begins in January 2003 and ends in December 2013. As there is no unanimity in the literature about the crisis periods in the continent-based regions, a formal statistical identification of crises is worthwhile to conduct. Furthermore, the effect of increasing cross-market correlations in the crisis compared to the pre-crisis period in the context of contagion is examining. To address this issue, both standard contemporaneous cross-correlations and volatility-adjusted cross-correlations are applied. The results are consistent with the literature and confn＇m that tests for contagion based on cross-market correlations are problematic due to the bias introduced by changing volatility in market returns. As contagion can be confused with globalization, the globalization tests in the group of international investigated markets are employed. The results generally do not confirm a global world market integration effect, i.e. there is no reason to reject the research hypothesis of no globalization during the 2007-2009 financial crisis.

The Application of the Emerging Market Score Model in China During the Global Crisis Period： A Countertrend

The global economic crisis that blew up at the end of 2006 in the United States has had extremely negative impacts on the social, political, and economic fields. The countries operating in the most affected macro areas---the United States and Europe---have put through the wringer the domestic trade relationships as well as the international ones, by injecting a chain reaction into the global economic scenario. However, there are countries that seem to be free from the economic and financial contagion overflowing over the past years, as they are moved by an ＂invincible projection toward the growth＂. The present study aims to analyze how much the main emerging market of China has been effectively involved in this vicious circle. More specifically, the study intends to propose an empirical analysis on the real connection between the macroecnnomic data and the strong structure of the Chinese publicly listed companies. This paper investigates the prediction of failure among 3,220 Chinese publicly traded companies （listed companies） during the global crisis period. By analysing the financial accounting data over the past seven years （2008 to 2014）, the emerging market score （EMS） has been adopted in order to investigate the impact of the crisis on financial distress in the main emerging market of China. The results confirm the following hypotheses： On one hand, the great majority of companies have not been suffering the downturn, since 71.93% of the entire samples present no risk of financial distress during the global crisis; on the other hand, only 6.18% have a reasonable risk of financial distress.

Due Diligence in Mergers and Acquisitions in Emerging Markets： Evaluated Risk Factors From the Academic and Practical View

The obviously ever increasing number of corporate acquisitions in recent decades has improved the general knowledge and awareness of due diligence for both the industry and research. In the current challenging business environment, acquisitions face a higher degree of risk profiles, especially cross-border acquisitions in the emerging markets. Conducting a thorough due diligence investigation in the context of an acquisition is more important now than ever. In a broad analysis, this paper researches the key risk factors in the acquisition process and their assessment within a due diligence audit in the acquisition phase. The task of this paper is to match the academic and practical view in order to give a more complete understanding of risk factors to be covered in due diligence audit. The starting point is the research of academic findings which basically concentrate on common approaches considering financial, legal, commercial, and some other issues in domestic acquisitions and in developed countries. In contrast, this paper considers risk factors in cross-border and emerging markets transactions. In addition, a number of business consultants publish studies based on surveys on this topic which reflect typical risk factors based on experience of their customers being involved in cross-border acquisitions. Their risk assessment consists of specific regulatory, political, and other factors, which may lead to commercial and reputational impediments in cross-border acquisitions. The outcome of the comparison is a comprehended list of evaluated risk factors, whereby the academic findings are complemented and supported by the practical experience in the business consultant＇s studies. Moreover, the practical approach points to the fact that due diligence scope needs to be suited to the dynamics of the markets. The comparison and the comprehended list of evaluated risk factors call for a more integrated system of due diligence and show herein the research deficit. Hence, the novelty is the compendium of evaluated risk factors which should be assessed in the pre-acquisition phase. The originality of the paper is given by a unique analysis of academic work about acquisition due diligence literature and consultant studies from anonymized practical experience based on insider information.

Taking on Emerging Markets

Chinese companies should bring our own brands and technologies overseas to boost competition in the global market,

The role of cross-listing,foreign ownership and state ownership in dividend policy in an emerging market

In this paper, we investigate if dividend policy is influenced by ownership type.Within the dividend literature, dividends have a signaling role regarding agency costs, such that dividends may diminish insider conflicts(reduce free cash flow) or may be used to extract cash from firms(tunneling effect)- which could be predominant in emerging markets. We expect firms with foreign ownership and those that are listed in overseas markets to have different dividend policies and practices than those that are not, and firms with more state ownership and less individual ownership to be more likely to pay cash dividends and less likely to pay stock dividends. Using firms from an emerging economy(China), we examine whether these effects exist in corporate dividend policy and practice. We find that both foreign ownership and cross-listing have significant negative effects on cash dividends, consistent with the signaling effect and the notion of reduced tunneling activities for firms with the ability to raise capital from outside of China. Consistent with the tunneling effect, we find that firms with higher state ownership tend to pay higher cash dividends and lower stock dividends, while the opposite is true for public(individual) ownership.Further analysis shows that foreign ownership mediates the effect of state ownership on dividend policy. Our results have significant implications for researchers, investors, policy makers and regulators in emerging markets.

An emerging market for groundwater remediation in China： Policies, statistics, and future outlook

There is a rapidly emerging and potentially huge market for the remediation of contaminated ground- water in China. The Chinese government published a Water Action Plan in April 2015, a Soil Action Plan in May 2016, and a draft Soil Pollution Prevention and Control Law in June 2017. All of these new policies and regulations put pressures on local governments and contaminated site owners, obliging them to conduct site investigation and to cleanup contaminated groundwater. The Chinese population in northern regions heavily depend on groundwater, with nearly 70% of water supply coming from aquifer sources in the Beijing-Tianjin-Hebei region. However, poor groundwater quality due to natural geochemical background and anthropogeic pollution is a serious concern, with poor or very poor quality water observed in nearly 80% of groundwater monitoring wells in 17 northern provinces. Shallow groundwater in many areas has been contaminated by toxic pollutants such as heavy metals and chlorinated organic compounds. There is an urgent need to better understand the situation and to conduct groundwater remediation at contaminated sites. The Chinese government is investing heavily in the research and development for groundwater remediation, which is expected to greatly add to the quality and quantity of groundwater remediation projects in the near future.

The Impacts of State Ownership on Information Asymmetry:Evidence from an Emerging Market

This study examines the effect of corporate ownership on information asymmetry as measured by bid-ask spread in the emerging markets of China. Government ownership has significant and positive impacts on bid-ask spread during the period 1995-2000, but disappears afterward during 2001-2003. The finding that state ownership raised bid-ask spread in the early period is consistent with recent studies on emerging markets including China, which indicate that firms with higher state ownership tend to have a greater deviation between cash flow rights and control rights(eg, Wei et al., 2005). This implies that lower state ownership is associated with lower information asymmetry in the market, an economic consequence of significant economic reform and privatization regarding the market microstructure. However, with more active control transfers andemergence of private controlling shareholders, regulatory changes in ownership structure and corporate governance mechanisms, and thus an improved legal and institutional environment, the link between the government ownership and information asymmetry turns to be insignificant in the later period. These results have important implications for transparency and information disclosure policies as well as privatization in emerging markets.

The Impact of Investing in Emerging Markets on Firm Performance: An Exploratory Study of Taiwan Residents Multinational Enterprises in the Chinese Mainland

Ⅰ.IntroductionDuring the past two decades,many multinationalenterprises(MNEs)have made substantial investmentsin emerging markets.Two factors dominate thereasoning in favor of such an investment strategy:lowlabor costs and the large size of the markets in the hostcountries.While these two economic factors seem quite

High ownership concentration and exporting of emerging market firms： evidence from Peru

Despite the extraordinarily high ownership concentration widely observed in emerging market firms as a result of institutional voids, there is little research on how this high ownership concentration affects the exporting behavior of emerging market firms. From principal-agent and institutional perspectives, we hypothesize that high ownership concentration has a negative relationship with export intensity, because, in emerging markets, highly concentrated ownership bridges the interests of owners （principals） and managers （agents） so that principals must be prudent in exploring risky international markets. Moreover, we hypothesize that export country diversification strengthens the relationship between ownership concentration and export intensity, because broad geographic dispersion increases risk exposure and principal-agent problems. Empirical analysis based on a panel dataset for publicly listed firms in Peru from 2005 to 2014 supports the hypotheses. The study highlights the risk aversion attitude activated by ownership concentration, an attitude that protects emerging market firms from overconfidently exploring international business opportunities. The study extends the conventional literature on the interface between ownership concentration and international business in an emerging market context. We also discuss the generalizability of the findings to other emerging markets, e.g. China.

Onsetof Emerging Market Crises with Probit Model

：This paper examines the relative strength of factors in predicting the onset of a financial crisis inthe emerging market during the 1990s. We estimate a probit model based on the quarterly data of 18countries. The results suggest that the mis-management in the economy and banking system, the shifts inthe international conditions and the depth of contagion effects are strongly associated with the presence ofcrises. Some of the results are somewhat different from the other empirical studies based on annual data. Acareful analysis of the probability distributions showed that the results were close to being correct in over90% of the cases.

Shareholder internationality and importing activities of emerging market firms

In light of the increasing efforts made by emerging market firms to engage in international business through importing activities,identifying the characteristics that motivate importing busi ness and con tribute to its success is practically and theoretically meaningful.Drawing upon a knowledge-based view(KBV),we examine how the shareholder internationality affects a firm's importing activities.We hypothesize that the shareholder internationality can facilitate a firm's import initiati on and con tribute to the diversity of importing countries of origin.Moreover,the divergence of shareholders'nationality backgrounds may hinder import initiation,but motivate importing from dispersed countries of origin during the import development process.A longitudinal analysis of Colombian firms supports our hypotheses.

Near-zero U.S. Interest Rates, Primary Commodity Prices, and Financial Control in Emerging Markets

The U.S. Federal Reserve's monetary policy at the center of the world dollar standard has a first-order impact on global financial stability. However, except in moments of international crises, the Fed focuses inward on domestic American economic indicators and generally ignores collateral damage from its monetary policies in the rest of the world. But this makes the U.S. economy less stable. Currently, ultra-low interest rates on dollar assets ignite waves of hot money into emerging markets by carry traders that generate bubbles in international primary commodity prices and other assets. These bubbles burst when some accident at the center, such as a banking crisis, causes a reflux of the hot money. Ironically, these near-zero interest rates hold back investment in the American economy itself.

Market Structure, Liquidity and the Performance of Emerging Equity Markets

Recent studies analyzing the liquidity of emerging equity markets （EEM） focus mainly on two independent variables： （1） the turnover ratio and （2） value of equity traded. They ignore the impact of the market concentration of stock traded which could generate price distortion/manipulation. This study empirically estimates the impact of market structure （concentration） and liquidity （turnover ratio） on equity performance （price/returns） of 19 EEM. We use panel data for the period 1992-2000 and least square dummy variable regression technique that measure fixed effects and the dynamics of adjustment. The results show the significance of both independent variables. Liquidity favours investment, and market concentration suggests the potential for market/price manipulation that requires regulatory policies. These results indicate success of reform policies aimed at capital deepening to improve efficient capital allocation and provide profitable investment opportunities.

Does country risk impact the banking sectors’non‑performing loans?Evidence from BRICS emerging economies

This study aims to fill the gap in the literature by specifically investigating the impact of country risk on the credit risk of the banking sectors operating in Brazil,Russia,India,China,and South Africa(BRICS),emerging countries.More specifically,we explore whether the country-specific risks,namely financial,economic,and political risks significantly impact the BRICS banking sectors’non-performing loans and also probe which risk has the most outstanding effect on credit risk.To do so,we perform panel data analysis using the quantile estimation approach covering the period 2004–2020.The empirical results reveal that the country risk significantly leads to increasing the banking sector’s credit risk and this effect is prominent in the banking sector of countries with a higher degree of non-performing loans(Q.25=−0.105,Q.50=−0.131,Q.75=−0.153,Q.95=−0.175).Furthermore,the results underscore that an emerging country’s political,economic,and financial instabilities are strongly associated with increasing the banking sector’s credit risk and a rise in political risk in particular has the most positive prominent impact on the banking sector of countries with a higher degree of non-performing loans(Q.25=−0.122,Q.50=−0.141,Q.75=−0.163,Q.95=−0.172).Moreover,the results suggest that,in addition to the banking sectorspecific determinants,credit risk is significantly impacted by the financial market development,lending interest rate,and global risk.The results are robust and have significant policy suggestions for many policymakers,bank executives,researchers,and analysts.

The impact of IFRS mandate and institutional governance on underpricing and aftermarket performance of IPO shares in Turkey

Along with the European Union,policymakers in Turkey passed a regulation that mandated all listed companies use the International Financial Reporting Standards(IFRS)starting from January 1,2005.Using a before-after estimation design,this study examines the impact of this policy change and the role of institutional governance quality on the initial trading day and aftermarket trading performance of initial public offerings(IPO)in Turkey from 1998 to 2019.The results show that the IFRS mandate does not affect initial trading day returns but improves the aftermarket trading performance of IPO shares.This finding may imply that Turkey’s secondary market also suffers from information asymmetry and that IFRS-compliant reports help alleviate this problem.Furthermore,none of the six institutional governance quality measures tested loaded significantly against initial trading day or long-term returns.However,when examined together,two institutional measures with a negative value,voice and accountability,and political stability,offset the positive effect of the IFRS-compliant reporting on longterm IPO returns,providing support to the premise that institutional quality matters for realizing the economic benefits of the IFRS mandate.

General election effect on the network topology of Pakistan’s stock market: network-based study of a political event

To examine the interdependency and evolution of Pakistan’s stock market,we consider the cross-correlation coefficients of daily stock returns belonging to the blue chip Karachi stock exchange(KSE-100)index.Using the minimum spanning tree network-based method,we extend the financial network literature by examining the topological properties of the network and generating six minimum spanning tree networks around three general elections in Pakistan.Our results reveal a star-like structure after the general elections of 2018 and before those in 2008,and a tree-like structure otherwise.We also highlight key nodes,the presence of different clusters,and compare the differences between the three elections.Additionally,the sectorial centrality measures reveal economic expansion in three industrial sectors—cement,oil and gas,and fertilizers.Moreover,a strong overall intermediary role of the fertilizer sector is observed.The results indicate a structural change in the stock market network due to general elections.Consequently,through this analysis,policy makers can focus on monitoring key nodes around general elections to estimate stock market stability,while local and international investors can form optimal diversification strategies.

Spillovers of US unconventional monetary policy:quantitative easing,spreads,and international financial markets

This study investigates the international spillover effects of US unconventional monetary policy(UMP)-frequently called large-scale asset purchases or quantitative easing(QE)—on advanced and emerging market economies,using structural vector autoregressive models with high-frequency daily data.Blinder(Federal Reserve Bank of St.Louis Rev 92(6):465–479,2010)argued that the QE measures primarily aim to reduce US interest rate spreads,such as term and risk premiums.Considering this argument and recent empirical evidence,we use two spreads as indicators of US UMP:the mortgage and term spreads.Based on data from 20 emerging and 20 advanced countries,our empirical findings reveal that US unconventional monetary policies significantly affect financial conditions in emerging and advanced countries by altering the risktaking behavior of investors.This result suggests that the risk-taking channel plays an important role in transmitting the effects of these policies to the rest of the world.The extent of these effects depends on the type of QE measures.QE measures such as purchases of private sector securities that lower the US mortgage spread exert stronger and more significant spillover effects on international financial markets than those that reduce the US term spread.Furthermore,the estimated financial spillovers vary substantially across countries and between and within the emerging and advanced countries that we examine in this study.

An Empirical Analysis of the Determinants of the Performance of the Global Private Equity Funds Markets

Over the last decade, the private equity （PE） industry, primarily venture capital and leveraged buyout investments, has matured massively. Consequently, public interest towards that particular asset class has increased rapidly. This study seeks to empirically assess the determinants of private equity funds＇ （PEFs） performance around the world. The study comprises a panel data of 103 publicly traded PEFs globally for the period of 2007-2013. Generalized least squares （GLS） technique is employed to regress the explanatory variables. The objective is accentuated on the major contributing factors that make a PEF successful. The analysis, in this paper, examines the effect of fund size, investment size, geographical focus, and industrial specialization on return. The empirical results provide evidence that： （1） Fund size and industrial specialization were observed to have an insignificant influence on the funds＇ returns in our panels; （2） Investment size is positively related to fund performance, indicating that larger deal sizes exhibited superior performance level; and （3） Geographical focus exhibited a negative association with fund performance, leading to the conclusion that limited geographical deployment of funds or absence of market diversification resulted in a fall in funds＇ returns. Consequently, to proxy for return of funds, stock prices of listed PEFs under LPEQ listings were employed.