International Corporate Finance eJournal最新文献

{"title":"International Trade and the Risk in Bilateral Exchange Rates","authors":"Ramin Hassan, Erik Loualiche, Alexandre R. Pecora, Colin Ward","doi":"10.2139/ssrn.3745935","DOIUrl":"https://doi.org/10.2139/ssrn.3745935","url":null,"abstract":"Exchange rate volatility falls after a trade deal, driven by a decline in the systematic component of risk. The average trade deal increases trade by 50 percent over five years, reducing systematic risk by a third of a standard deviation across countries. We examine this connection in an Armington model where the structure of trade networks determines the risk in exchange rates. We estimate our model to current data and find i) that countries at the periphery of the world trade network benefit the most from lower trade barriers and ii) that a counterfactual experiment of a trade war between the US and China shows a global increase in currency risk, with effects concentrated among peripheral countries.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"63 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-08-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"84789928","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Asymmetry and hysteresis in the Russian gasoline market: the rationale for green energy exports","authors":"Dean Fantazzini, A. Kolesnikova","doi":"10.2139/ssrn.3908988","DOIUrl":"https://doi.org/10.2139/ssrn.3908988","url":null,"abstract":"Using monthly data of 79 Russian regions from 2003 to 2017, we study the long-run relationship of the retail gasoline prices with the crude oil price and the nominal exchange rate. We find that models that were successfully applied to deal with asymmetries in other countries are not suitable for Russia without taking structural breaks into account. Once breaks are allowed, we find that there is no asymmetry in the long-run elasticities between the gasoline prices and the crude oil price, \u0000and no significant hysteresis. However, there is an asymmetric relation between the gasoline price and the exchange rate that has decreased over time. These results also hold after several robustness checks. The evidence reported in this work shows that the effects of the exchange rate on gasoline prices are much more difficult to control than the oil price, and they require a larger set of policy measures: the recent development of a plan to decrease the importance of hydrocarbons exports \u0000by producing clean hydrogen using electrolysis and pyrolysis and the potential future export of electricity generated using nuclear power and onshore wind farms may help to diversify the local economy and to shield it from new sanctions.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"55 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-08-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"74939923","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Cryptocurrency: Towards Regulating the Unruly Enigma of Fintech in Nigeria and South Africa","authors":"F. Ukwueze","doi":"10.17159/1727-3781/2021/v24i0a10743","DOIUrl":"https://doi.org/10.17159/1727-3781/2021/v24i0a10743","url":null,"abstract":"One of the most modern inventions of financial technology (FinTech) since after the global financial crisis of 2008 is the crypto or virtual currency/asset. Since the creation of the first cryptocurrency, the Bitcoin, in 2009, it is estimated that over five thousand variants of the Bitcoin and other cryptocurrencies have emerged. Virtual currencies have become widespread across the globe but their legal status and uses in various countries have remained uncertain. They have been variously classified as currencies, securities, properties, assets, commodities and tokens, and used as means of exchange but are not legally recognised as legal tender. In many jurisdictions their emergence was greeted with scepticism and express or tacit rejection by financial and securities markets regulators, but over time, owing to their increasing popularity, characteristics, positive and negative potentials, there has been a gradual shift towards their formal recognition and regulation. Regulatory authorities in many countries are now grappling with designing appropriate policy and regulatory framework for the crypto phenomenon. This paper interrogates the current legal status and efforts to regulate cryptocurrencies in two leading African nations, Nigeria and South Africa, and highlights the challenges of designing an appropriate regulatory framework for this enigmatic technology. The paper adopts the doctrinal legal research methodology, employing the descriptive, analytical, and comparative approaches. It follows a structured review and analysis of relevant extant legislation on currencies and securities in the countries to ascertain whether they cover cryptocurrencies. It then compares the current position of the law on the subject in the two countries. Bearing in mind that it may not be possible to totally ban dealing in cryptocurrencies, the paper concludes that regulation has become imperative. Drawing from the position on the subject in more developed nations, the United States of America (US) and the European Union (EU), this paper proposes a model of regulation of virtual currency not only for Nigeria and South Africa but also for other African countries.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"9 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-08-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"88362347","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Dissecting the Segmentation of China’s Repo Markets","authors":"X. Xu","doi":"10.2139/ssrn.3914684","DOIUrl":"https://doi.org/10.2139/ssrn.3914684","url":null,"abstract":"China repos trade in the over-the-counter interbank market as well as the stock exchange. This paper examines the behaviours, sources, and drivers of the spread between China’s exchange and interbank repo rates from December 2006 to June 2018. After adjusting for different day-count quoting methods, I dissect the exchange to interbank repo spread into two components: cross-market segmentation between exchange and interbank markets for non-depository institutions (NDIs), and within-market counterparty segmentation between NDIs and depository institutions (DIs) in the interbank market. The 1-day repo markets are found to be more segmented, with the spread mainly driven by the cross-market segmentation for NDIs, reflecting the two different market mechanisms and trading frictions that prevent NDIs from effectively arbitraging across the two markets in the shorter tenor. On the other hand, the 7-day repo markets are found to be less segmented, with the spread mainly driven by the counterparty segmentation between NDIs and DIs within the interbank market, reflecting greater counterparty credit and liquidity risks for NDIs relative to DIs. Further analysis uncovers the impacts of quarter-end effect, monetary policies, and shadow banking activities on the cross-market and within-market segmentations in China’s repo markets.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"204 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77032305","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Is Cardano a Serious Rival to Ethereum?","authors":"Jackie Johnson","doi":"10.2139/ssrn.3886108","DOIUrl":"https://doi.org/10.2139/ssrn.3886108","url":null,"abstract":"Cardano was launched in October 2017 and by May 2021 has been operational for 44 months. Comparison with its closest rival, Ethereum, reveals that their prices are highly correlated but the change in daily closing prices do not always move in unison. Cardano is also more volatile than Ethereum and In terms of growth Cardano is lagging behind. Cardano’s only saving grace is its transaction fees, which are considerably lower than Ethereum. However, care must be taken in understanding the structure of any data source. In this case three data sources are used and results vary depending on the precision of the price data, particularly Cardano which for a number of years did not trade above one dollar.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"232 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-07-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"81871577","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Is the Value Premium Smaller Than We Thought?","authors":"Mathias Hasler","doi":"10.2139/ssrn.3886984","DOIUrl":"https://doi.org/10.2139/ssrn.3886984","url":null,"abstract":"The construction of the original HML portfolio (Fama and French, 1993) includes six seemingly innocuous decisions that could easily have been replaced with alternatives that are just as reasonable. I propose such alternatives and construct HML portfolios. In sample, the average estimate of the value premium is dramatically smaller than the original estimate of the value premium. The difference is 0.09% per month and statistically significant. Out of sample, however, this difference is statistically indistinguishable from zero. The results suggest that the original value premium estimate is upward biased because of a chance result in the original research decisions.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-07-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"86349550","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Firm-Level Political Risk and Corporate Innovation","authors":"Obaid ur Rehman, Xiaoxing Liu, Kai Wu, Shaofang Li","doi":"10.2139/ssrn.3880272","DOIUrl":"https://doi.org/10.2139/ssrn.3880272","url":null,"abstract":"This study finds a negative association between firm-level political risk (PRISK) and firm-level patents and citations in general. The PRISK extracted from different sectors also shows similar effects. This impact is more pronounced when a firm belongs to economically uncertain states, politically corrupted regions, and competitive industries. Besides, we identify that increasing cost of capital is a transmission channel that surges the negative impact of PRISK on corporate innovations. We also find the robust negative impact of PRISK on innovation when firms mainly rely on external finances. Our findings have policy implications for the firm’s manager, market participants, and practitioners.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"9 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-07-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75197841","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Exchange Rate Volatility and Cross–Border Travel: Theory and Empirics","authors":"Wisarut Suwanprasert","doi":"10.2139/ssrn.3882942","DOIUrl":"https://doi.org/10.2139/ssrn.3882942","url":null,"abstract":"I develop a search-theoretic model to study how consumers' search behavior responds to exchange rate volatility. The model offers two main predictions. First, the number of cross-border travelers is increasing in exchange rate volatility. Second, the elasticity of cross-border travel with respect to exchange rate volatility is increasing in transportation cost. I use monthly Canadian traveler data from 2005 to 2012 to test the model's predictions. The estimate suggests that when exchange rate volatility increases by one standard deviation, the number of same-day travelers increases by 1.6 percent. When exchange rate volatility is measured by implied volatilities, the estimates increase to 2.1–2.5 percent. When the data is restricted to the subperiod before the 2008 financial crisis, the estimated coefficients of exchange rate volatility and implied volatilities increase to 4 percent and 7.3–10.7 percent, respectively. This paper concludes that cross-border shopping behavior responds to both ex ante and ex post exchange rate volatilities.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"23 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-07-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"88180754","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Investor-State Arbitrators' Duties to Non-Parties","authors":"Perry S. Bechky","doi":"10.2139/ssrn.3554180","DOIUrl":"https://doi.org/10.2139/ssrn.3554180","url":null,"abstract":"Arbitrators in investor-state disputes plainly owe duties to the parties. They are appointed to do a job and they must do that job and do it well: competently, diligently, ethically, expeditiously, fairly, impartially and independently, and properly. They must act with sound judgment, due care, and an open mind. But do investor-state arbitrators also owe duties to anyone else? If so, what duties do they owe and to whom? From where do such duties originate? Given that party autonomy is a hallmark of arbitration, may duties to non-parties ever prevail over the will of the parties? How are such duties enforced? And, what does the existence of duties to non-parties mean for the system of international investment arbitration? Investment arbitration was born from a party-centric tradition. But it has become clear that tribunal rulings affect non-parties. Scrutiny is needed of the responsibilities the arbitrators owe those outside the room. This article explores this less-trodden terrain. It begins by establishing a beachhead – a clear example of a duty to a non-party, as a proof of concept – before moving into rougher territory. Thus, it opens with an illustration of a duty created by the treaty establishing the International Centre for Settlement of Investment Disputes (“ICSID”): a tribunal must issue a written, reasoned award. After demonstrating that this first duty is owed to ICSID itself as an institution (as well as to the parties), the article adds other duties that investor-state arbitrators owe to arbitral institutions and to non-party participants in investment cases, including other states and non-government organizations. It then introduces the concept of systemic duties, which arbitrators owe not to particular persons, but to the creators of the investment arbitration system (states) and its ultimate beneficiaries (the global public). Finally, the article discusses how recognizing duties to non parties both informs a proper understanding of the investment arbitration system and may help improve that system.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"49 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-07-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"86073364","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Financial Mechanisms of Ensuring the Development of Business under High Interest Rates","authors":"Vitaliy Shapran, Ihor Britchenko","doi":"10.38188/2534-9228.21.2.03","DOIUrl":"https://doi.org/10.38188/2534-9228.21.2.03","url":null,"abstract":"In the given article the problems of choice as for the types and forms of debt and share financing on the developing and “frontier markets” with high interest rates have been considered, the definition of what kind of interest rates can be viewed as high and under which circumstances nominal interest rate and in which ones – the real interest rate is important for business. Also, the classification of debt and sharing financing is given and the comparative analysis of such financing is made. Some close attention has been paid to the calculation of the real interest rate according to the inflation forecast. Recommendations concerning attracting of relatively cheap trade financing including international financial and credit organizations, development of operation factoring, financing from captive financial institutions of the exporters of the materials and equipment from the EU and the US have been grounded. The opportunity of relatively free of charge share financing through the mechanism of placing shares IPO/SPO is emphasized, exemplified by the results of placing shares on stock exchanges and their alternative platforms of issuing banks with businesses in Ukraine in 2005 – 2013. As a result, the conclusion concerning the necessity of thorough analysis of financial conditions on the developing and frontier markets before gaining such financing has been made. High interest rates within the average indicators even on the basis of prime rates do not necessarily mean absence of attractive conditions of financing.","PeriodicalId":13701,"journal":{"name":"International Corporate Finance eJournal","volume":"67 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-06-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"89410845","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}