|
on Investment |
|
Issue of 2024‒07‒15
nineteen papers chosen by |
| By: | Han, Jung Min (Korea Institute for Industrial Economics and Trade) |
| Abstract: | The overall composite Business Survey Index for the manufacturing sector in the first quarter of 2024 (Q1 2024) remained under the baseline (100). Moreover, most feeder indices have slightly decreased compared to the previous quarter. Business conditions (83), sales (82), domestic demand (83), exports (88), ordinary profit (84), and financial conditions (97) in the manufacturing sector have all declined; inventory (100) and employment (97) held steady. BSI forecasts for Q2 2024 indicate that manufacturers anticipate a more favorable business environment. Most indices for the manufacturing sector are forecasted to be over the baseline (100); just ordinary profit (97), facilities investment (99), and financial condition (95) indices are projected to stay below baseline levels, but even these sub-baseline figures would nonetheless represent increases from the previous quarter. |
| Keywords: | Business Survey Index; BSI; KIET; business outlook; macroeconomy; industrial outlook; business climate; Q1 2024; Q2 2024; Q1 review; Q2 outlook; Korea; KIET |
| JEL: | E20 E22 E37 E60 |
| Date: | 2024–04–30 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kieter:2024_010&r= |
| By: | Lee, Jin-Myon (Korea Institute for Industrial Economics and Trade); Kang, Ji Hyun (Korea Institute for Industrial Economics and Trade) |
| Abstract: | Indonesia is becoming a more and more important player in the global economy due to its large and growing population, abundant natural resources, strategic location, emerging market potential, investment in infrastructure, and membership in key regional economic blocs. Bilateral trade between this new regional player and South Korea has been steadily growing, encompassing a wide range of goods and services, and Indonesia offers attractive investment opportunities for Korean businesses across various sectors. Korean President Yoon Suk-Yeol, attending the Korea-Indonesia Business Roundtable held in Indonesia in 2023, presented a development strategy for a new 50-year partnership between the two countries. Yoon stressed the potential for fruitful cooperation between Indonesian and Korean companies in advanced industries, including the electric vehicle (EV) and battery sectors, given Indonesia’s status as the largest ASEAN economy and its vast reserves of critical minerals. However, despite the two country’s longstanding economic relationship, key challenges remain, such as stagnation and instability. In this paper, we analyze major trends and core features of the economic cooperation between Korea and Indonesia, focusing on trade and investment. We then address some of the strengths and weaknesses of the cooperative relationship. Based on this, conclude the paper by describing the implications for a more sustainable economic partnership. |
| Keywords: | Korea-Indonesia relationship; natural resources; critical mineral resources; economic cooperation; Korea-Indonesia trade; Foreign Direct Investment; FDI; industrial development; industrial cooperation; strategic collaboration; supply chain stability; Korea; KIET |
| JEL: | F00 F10 F13 F15 F20 F21 F23 |
| Date: | 2024–04–30 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kieter:2024_008&r= |
| By: | Kim, C.K. (Korea Institute for Industrial Economics and Trade) |
| Abstract: | Advancements in production technology have significantly improved automobile performance and lifespan, nearly doubling the average useful life of a vehicle in Korea to 16 years in 2021, up from just 8.3 in 2000. However, a consumer survey by a secondhand vehicle sales company in 2023 found that Koreans typically change their vehicles every three to six years. This suggests that most vehicles are traded several times over their lifecycle, and in Korea, this includes export abroad. Used vehicle exports extend the vehicle’s life and contribute to the formation of a circular economy, and also minimize the amount of resource waste generated in the scrapping process. In this paper I explore the rapidly evolving used vehicle market, focusing on exports, and provide a suite of policy recommendations based on my findings to improve the competitiveness of Korea’s used vehicle exports. |
| Keywords: | used vehicles; used cars; secondhand vehicles; used vehicle exports; circular economy; export regulations; SMEs; used vehicle inspection; used vehicle quality certification; Korean used vehicles; Hyundai; Kia; Genesis; automotive industry; Automobile Management Act; Korea; KIET |
| JEL: | F10 F13 L62 |
| Date: | 2024–04–30 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kieter:2024_006&r= |
| By: | Kaz Miyagiwa (Department of Economics, Florida International University); Yunyun Wan (Department of Humanities and Regional Studies, Akita University, Akita, Japan) |
| Abstract: | A search-theoretic model of illegal immigration is presented to examine the effect of deportation and other policy measures on unemployment, crimes and immigration flows. It is found that deporting immigrants who commit crimes lowers the unemployment rate and causes an increase in native labor force. However, if hiring immigrants is more profitable than hiring natives, deportation increases the immigrant population and the number of crimes they commit. Anti-crime policy and higher minimum wages generate similar effects. |
| Keywords: | illegal immigration, deportation, unemployment, crimes, minimum wages |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:fiu:wpaper:2408&r= |
| By: | Giovanni Di Bartolomeo; Carolina Serpieri |
| Abstract: | We investigate the behavior of central banks in seven advanced economies, focusing on how observed monetary policies align with optimal ones as determined by model-consistent welfare measures. Our approach stands out by emphasizing the importance of inertia’s impact on the output gap and the dynamics of prices and wages. We incorporate inertia into our model using duration-dependent adjustments. By integrating this aspect into a simple New Keynesian model, our analysis aims to identify shared patterns and distinctive features in the monetary policy approach of central banks across different countries. |
| Keywords: | duration-dependent adjustments; intrinsic inflation persistence; DSGE models; hybrid Phillips curves; optimal policy |
| JEL: | E31 E32 C11 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:sap:wpaper:wp249&r= |
| By: | Rafael Ramalho Vale Cavalcante (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique); Frédéric Kletz (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique); Jean-Claude Sardas (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique) |
| Date: | 2022–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04581431&r= |
| By: | Bell, William Paul; Zheng, Xuemei |
| Abstract: | This reports aims to assist the Sino-Australian bilateral relationship adapt to meet China’s new policies and to facilitate a smoother transition to a low carbon future. Southwest University of Finance and Economics (SWUFE), Chengdu, China and the University of Queensland, Brisbane, Australia held a workshop at SWUFE to develop a guide to China’s low-carbon policies and their implications for the Sino-Australian energy trade and sectors. This report results from the workshop. Chapter 3 contains the guide to China’s low emission policies and discusses market-based experiments within China’s command-and-control electricity sector. Chapter 4 discuses Australia’s poorly implemented neoliberal polices within its energy sector and provides an informative market-based case study for China on what to avoid. Chapter 2 discusses the implications of Australia and China’s low emission policies. Chapter 5 discusses barriers to the transition to a low emissions economy. Climate change is one of the world’s major challenges. Others include increasing inequality and poor economic growth, creating a decline in inclusive growth. Declining inclusive growth and climate change are interrelated wicked problems. Their solution is technically and economically viable given appropriate investment but the absence of a price on carbon in Australia is a major obstacle to directing investment consistent with a low emissions future. Australia is transitioning from a mining to a more service orientated economy. However, Australia’s uncoordinated energy and climate change policy and poorly implemented neoliberal policies in the energy sector are undermining investment confidence and hindering both inclusive growth and the transition to a lower emissions economy. Energy and climate change policies need bring together to restore investment confidence within the electricity sector. The Integrated Systems Plan has gone some way to address this problem. Similarly, Australia’s uncoordinated growth and climate change policies are hindering inclusive growth and the transition to a lower emissions economy. Growth and climate change policies need bringing together to engender confidence and direct investment compatible with a low emissions future. Notably, Infrastructure Australia has gone some way to address this issue at the national level but the lack of transparency and independence in other jurisdictions undermines Infrastructure Australia’s effectiveness. Poor policy coordination is also hindering solutions to a host of other interrelated wicked problems. These wicked problems include massive increases in retail electricity prices, private school fees and private health insurance, the inability to undertake major tax reform, such as introducing a tax on sugar or carbon or introduce road user charges to replace the declining revenue from fuel excise duty. There is ample and sound evidence-based research to solve these wicked problems but there is an inability to enact policy in the interest of the electorate. The key findings of this report are four common barriers to enacting policy to solve these wicked problems. (1) Political donations present a conflict of interest. (2) Adversarial politics and political wedging reduce the ability to address complex problems. (3) There is an absence of academic economists informing the public debate to provide impartial advice. (4) Unrealistic models of the economy and human behaviour are misinforming policy. |
| Keywords: | Australia China wicked problems climate change electricity energy renewable energy inclusive growth inequality growth tax emissions generation coal electricity prices electricity market policies political donations political wedging adversarial politics economic growth donations neoclassical economics neoliberal policies government economic transition retail fossil fuel public good efficiency efficiency generators green investment green finance climate change risk housing boom mining boom zero net emissions |
| JEL: | H1 H2 O4 Q2 Q3 Q4 Q5 |
| Date: | 2108–02–16 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:84509&r= |
| By: | Andrea Bellucci (Universita' degli Studi dell'Insubria and Mo.Fi.R.); Alexander Borisov (Lindner College of Business, University of Cincinnati and MoFiR); Gianluca Gucciardi (Department of Economics, Management and Statistics, University of Milano-Bicocca and MoFiR); Alberto Zazzaro (University of Naples Federico II, CSEF and MoFiR) |
| Abstract: | Technological advancements and globalization of venture capital (VC) point to a diminishing role of direct face-to-face (F2F) interactions between VCs and entrepreneurs seeking funding. We show that ability to conduct such interactions remains an important factor for segments of the VC market, and especially for its internationalization. Using a sample of VC deals around the world, and the staggered implementation of travel restrictions across countries in response to the spread of Covid-19 in 2020, we find that investment by foreign VCs in a country drops after it halts inbound travel. Our analysis of possible channels suggests that information asymmetry between contracting parties is the main driver of the importance of F2F, while technological constraints on the transmission of information and cultural differences are less significant. |
| Keywords: | Face-to-Face Interaction, Investments, Venture Capital |
| JEL: | G24 F21 D81 E22 E44 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:anc:wmofir:185&r= |
| By: | Marco Cipriani; Thomas M. Eisenbach; Anna Kovner |
| Abstract: | We use high-frequency interbank payments data to trace deposit flows in March 2023 and identify twenty-two banks that suffered a run, significantly more than the two that failed but fewer than the number that experienced large negative stock returns. The runs were driven by large (institutional) depositors, rather than many small (retail) depositors. While the runs were related to weak fundamentals, we find evidence for the importance of coordination because run banks were disproportionately publicly traded and many banks with similarly bad fundamentals did not suffer a run. Banks that survived a run did so by borrowing new funds and then raising deposit rates, not by selling liquid securities. |
| Keywords: | bank runs; payments; coordination; public signals |
| JEL: | E41 E58 G01 G21 G28 |
| Date: | 2024–05–01 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fednsr:98373&r= |
| By: | Benoit Jamet (IRGO - Institut de Recherche en Gestion des Organisations - UB - Université de Bordeaux - Institut d'Administration des Entreprises (IAE) - Bordeaux); Julien Bousquet; Antoine Masse |
| Abstract: | The determinants of banks' voluntary environmental disclosure have been little studied in the literature. Drawing from the assumptions of institutional theory, this paper analyzes the impact of the national context, including the general legal system and the environmental policy of states, on banks' carbon disclosure. Based on three international samples, the results show a positive relationship between the strength of the legal system (degree of law enforcement), the stringency of environmental regulations, environmental performance, and the quality of banks' carbon disclosure. |
| Abstract: | Los factores determinantes de la divulgación voluntaria de información medioambiental por parte de los bancos han sido poco estudiados en la literatura. Partiendo de los supuestos de la teoría institucional, este trabajo analiza el impacto del contexto nacional, incluido el sistema jurídico general y la política medioambiental de los Estados, en la divulgación de las emisiones de carbono por parte de los bancos. Basándose en tres muestras internacionales, los resultados muestran una relación positiva entre la solidez del sistema jurídico (grado de cumplimiento de la ley), el rigor de la normativa medioambiental, los resultados medioambientales y la calidad de la divulgación de las emisiones de carbono por parte de los bancos. |
| Abstract: | Les déterminants de la divulgation volontaire d'informations environnementales par les banques ont été peu étudiés dans la littérature. S'appuyant sur les hypothèses de la théorie institutionnelle, cet article analyse l'impact du contexte national, y compris le système juridique général et la politique environnementale des États, sur la divulgation des émissions de carbone par les banques. Sur la base de trois échantillons internationaux, les résultats montrent une relation positive entre la force du système juridique (degré d'application de la loi), la rigueur des réglementations environnementales, la performance environnementale et la qualité de la divulgation d'informations sur le carbone par les banques. |
| Keywords: | Banking industry, Voluntary carbon disclosure, Institutional theory, Legitimacy theory, Sector bancario, Revelación voluntaria de información sobre el carbono, Teoría institucional, Teoría de la legitimidad, Secteur bancaire, Divulgation volontaire des émissions de carbone, Théorie institutionnelle, Théorie de la légitimité. |
| Date: | 2024–03 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04593177&r= |
| By: | Pablo Guillen; Rami Tabri; Edward Wang |
| Abstract: | We propose a modification of the University Admissions Centre (UAC) mechanism to allow preference lists to be submitted in batches until the applicant is matched to a seat. Batching eliminates truncation and thus recovers strategy-proofness, allowing for the clearinghouse to provide simple advice. The current UAC mechanism uses a constrained list, giving incentives to students to strategize. We test the efficiency of our modification in an individual decision-making matching experiment in which we compare the batched mechanism with the current mechanism, with and without advice. Results show that while the batched mechanism exhibits greater efficiency for student welfare, better advice is required to improve truth-telling and thus avoid suboptimal matches. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:syd:wpaper:2024-13&r= |
| By: | Wei Wang; Haibo Wang |
| Abstract: | This study uses data from the BRICS stock market index, cryptocurrencies, and investor sentiment indicators from January 6, 2015, to June 29, 2023. BRICS nations emerge as pivotal representatives of emerging economies. This study employs a time-varying parameter vector autoregression model to unravel the intricate interdependence between traditional stock assets and the evolving landscape of cryptocurrencies. The analysis investigates spillover effects between BRICS stock markets and cryptocurrencies, revealing increasing interconnectedness during highly uncertain events like COVID-19, but no significant impact on major US stock market indices. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2406.07641&r= |
| By: | Zareei, Afsaneh (Stockholm University); Falahi, Mohammad Ali (Ferdowsi University of Mashhad); Wadensjö, Eskil (Stockholm University); Sadati, Saeed Malek (Ferdowsi University of Mashhad) |
| Abstract: | Sanctions have severe adverse effects on societies. Even though sanctions are used against governments, the population is punished for its government's behavior. Sanctions can create problems due to international migration. Iran is an unique case study because it faced the most and hardest sanctions in the world until February 2022. Many negative effects on the economy have been observed such as losing the Rial's value against the US Dollar by 80 percent, increasing poverty, and reducing exports and imports. At the same time, Iran had a very fast growth of emigration with an increase of 141 percent. Sanctions have been imposed on Iran's economy in different ways, but so far, it has not been determined how each type of sanctions will affect emigration. The aim of this study is to study the relationship between different kinds of economic sanctions and labor emigration using the Dynamic Stochastic General Equilibrium model. Different types of sanctions as oil and nonoil exports and three different import sanctions on consumer, capital, and intermediate goods are considered. The results show that sanctions on nonoil exports are most influencing emigration. Sanctions on the imports of intermediate and consumer goods, as well as sanctions on oil exports, are in the next steps, but not as much as the non-oil exports. It can be noticed that out of approximately 24 million people working in Iran, up to 4 percent of the working force have a desire to leave the country as migrant workers due to the sanctions. |
| Keywords: | international sanctions, labor emigration, DSGE Models, Iran |
| JEL: | B22 C02 C11 C68 F22 P00 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17062&r= |
| By: | Stephanie Ettmeier; Alexander Kriwoluzky |
| Abstract: | We investigate the interplay of the monetary-fiscal policy mix during times of crisis by drawing insights from the Great Inflation of the 1960s and 1970s. We use a Sequential Monte Carlo (SMC) algorithm to estimate a DSGE model with three distinct monetary/fiscal policy regimes. We show that in such a model SMC outperforms standard sampling algorithms because it is better suited to deal with multimodal posteriors, an outcome that is highly likely in a DSGE model with monetary-fiscal policy interactions. From the estimation with SMC a differentiated perspective results: pre- Volcker macroeconomic dynamics were similarly driven by passive monetary/passive fiscal policy and fiscal dominance. We apply these insights to study the post-pandemic inflation period. |
| Keywords: | Bayesian Analysis, DSGE Models, Monetary-Fiscal Policy Interactions, Monte Carlo Methods |
| JEL: | C11 C15 E63 E65 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2024_565&r= |
| By: | Christian A. L. Hilber; Tracy M. Turner |
| Abstract: | We examine the role that housing market regulatory restrictiveness plays in differentially affecting the net wealth of owners and renters over time, and its contribution to wealth inequality. In tightly regulated desirable cities, house prices and rents rise strongly in response to growing demand. Rising prices financially benefit existing homeowners. Rising rents hurt renters. Because credit constraints prevent many households from becoming homeowners, this can lead to growing differences in wealth accumulation between homeowners and renters and, consequently, rising wealth inequality. Employing the confidential version of the Panel Study of Income Dynamics (PSID), we explore to what extent changes in household net wealth can be explained by regulatory restrictiveness and demand shock-induced spatial differences in house price growth. We find that, accounting for sorting, a household with average characteristics that owns instead of rents in a tightly regulated location accumulates 56% more in net wealth between 1999 and 2019. This effect explains 59% of the observed difference in net wealth accumulation between actual owners and renters in these locations, consistent with an observed increase in the Gini-coefficient of wealth inequality during our sample period of 13%. In less regulated metro areas, we do not find a difference in wealth accumulation by homeownership status nor rising wealth inequality. Examining homeowners only and accounting for sorting, our findings suggest that if a homeowner with average characteristics had resided in a tightly rather than loosely regulated metro area, their predicted twenty-year net wealth increase would be 81% higher. We examine transition and timing effects and find theoretically plausible results that the housing boom yielded net wealth changes that varied by regulatory status, but the housing bust did not. We conduct robustness checks that examine the potential endogeneity of initial homeownership, account for unobserved heterogeneity and test for homeowner cash-out/reinvest behavior. In a falsification test, we show that our findings cannot be explained by correlations between local house price growth, a rising college premium and local variation in stock investment behavior. Taken as a whole, our findings imply that expected gains provide powerful financial incentives to existing homeowners in tightly regulated markets to maintain regulatory stringency, further exacerbating housing unaffordability and wealth inequality. |
| Keywords: | land use regulation, wealth accumulation, wealth inequality, house prices, housing rents, housing supply, housing affordability |
| Date: | 2024–06–10 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepdps:dp2003&r= |
| By: | Fabrice Murtin |
| Abstract: | This paper applies Machine learning techniques to Google Trends data to provide real-time estimates of national average subjective well-being among 38 OECD countries since 2010. We make extensive usage of large custom micro databases to enhance the training of models on carefully pre-processed Google Trends data. We find that the best one-year-ahead prediction is obtained from a meta-learner that combines the predictions drawn from an Elastic Net with and without interactions, from a Gradient-Boosted Tree and from a Multi-layer Perceptron. As a result, across 38 countries over the 2010-2020 period, the out-of-sample prediction of average subjective well-being reaches an R2 of 0.830. |
| Keywords: | poverty, spatial inequality, well-being |
| JEL: | C1 C45 C53 D60 I31 |
| Date: | 2024–06–28 |
| URL: | https://d.repec.org/n?u=RePEc:oec:wiseaa:27-en&r= |
| By: | James Costain (BANCO DE ESPAÑA); Anton Nakov (BANCO DE ESPAÑA) |
| Abstract: | We review models of nominal price adjustment based on optimizing or near-optimal behavior, including menu cost models, generalized hazard function models and models of frictional decisions. We also discuss the role of real rigidities and assess the models’ success in explaining retail microdata and inflation dynamics. |
| Keywords: | sticky prices, nominal rigidities, state-dependent prices, inflation, menu costs, control costs, rational inattention |
| JEL: | E31 E71 |
| Date: | 2024–05 |
| URL: | https://d.repec.org/n?u=RePEc:bde:opaper:2416&r= |
| By: | Mauro Cazzaniga; Carlo Pizzinelli; Emma J Rockall; Ms. Marina Mendes Tavares |
| Abstract: | We document historical patterns of workers' transitions across occupations and over the life-cycle for different levels of exposure and complementarity to Artificial Intelligence (AI) in Brazil and the UK. In both countries, college-educated workers frequently move from high-exposure, low-complementarity occupations (those more likely to be negatively affected by AI) to high-exposure, high-complementarity ones (those more likely to be positively affected by AI). This transition is especially common for young college-educated workers and is associated with an increase in average salaries. Young highly educated workers thus represent the demographic group for which AI-driven structural change could most expand opportunities for career progression but also highly disrupt entry into the labor market by removing stepping-stone jobs. These patterns of “upward” labor market transitions for college-educated workers look broadly alike in the UK and Brazil, suggesting that the impact of AI adoption on the highly educated labor force could be similar across advanced economies and emerging markets. Meanwhile, non-college workers in Brazil face markedly higher chances of moving from better-paid high-exposure and low-complementarity occupations to low-exposure ones, suggesting a higher risk of income loss if AI were to reduce labor demand for the former type of jobs. |
| Keywords: | Artificial intelligence; Employment; Occupations; Emerging Markets |
| Date: | 2024–06–07 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2024/116&r= |
| By: | Tim Morris (University College London); Ella Marley-Zagar (University College London) |
| Date: | 2023–02–23 |
| URL: | https://d.repec.org/n?u=RePEc:boc:biep23:01&r= |