Ayman F. Omar, T. Wisniewski, Sandra Nolte (Lechner)
{"title":"Diversifying away the Risk of War and Cross-Border Political Crisis","authors":"Ayman F. Omar, T. Wisniewski, Sandra Nolte (Lechner)","doi":"10.2139/ssrn.2177956","DOIUrl":"https://doi.org/10.2139/ssrn.2177956","url":null,"abstract":"This paper investigates the behavior of crude oil prices, government bonds, and stock market indices around outbreaks of severe international crises and wars. Using a constant mean return event study, we show that these events are associated with positive and significant abnormal returns on oil and bonds, which means that these two asset classes can potentially shelter shareholders from plummeting equity values during international crises. A formal safe haven analysis confirms this insight. Such price movements may reflect a reallocation of funds across asset classes in response to the events, as well as shifts in the demand for oil due to precautionary, speculative, and military motives. We also calculate the weights for optimal portfolios, which could provide insurance against conflict risk.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"66 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2015-02-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"72890562","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}
Louise J. Cord, Oscar Barriga Cabanillas, L. Lucchetti, Carlos Rodríguez‐Castelán, L. Sousa, Daniel Valderrama
{"title":"Inequality Stagnation in Latin America in the Aftermath of the Global Financial Crisis","authors":"Louise J. Cord, Oscar Barriga Cabanillas, L. Lucchetti, Carlos Rodríguez‐Castelán, L. Sousa, Daniel Valderrama","doi":"10.1111/rode.12260","DOIUrl":"https://doi.org/10.1111/rode.12260","url":null,"abstract":"Over the past decade (2003-12), Latin America has experienced strong income growth and a notable reduction in income inequality, with the region's Gini coefficient falling from 55.6 to 51.8. Previous studies have warned about the sustainability of such a decline, and this paper presents evidence of stagnation in the pace of reduction of income inequality in Latin America since 2010. This phenomenon of stagnation is robust to different measures of inequality and is largely attributable to the impact of the Global Financial Crisis on Mexico and Central America, where inequality rose after 2010 as labor income recovered. Moreover, this paper finds evidence that much of the continuation of inequality reduction after the crisis at the country level has been due to negative or zero income growth for households in the top of the income distribution, and lower growth of the incomes of the poorest households. The crisis also highlighted weaknesses in the region's labor markets and the heavy reliance on public transfers to redistribute, underscoring the vulnerability of the region's recent social gains to global economic conditions.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"14 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77027834","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":"The Effect of Banking Crises on Non-Life Insurance Consumption","authors":"Shinichi Kamiya, Jackie Li, George Zanjani","doi":"10.2139/ssrn.2512808","DOIUrl":"https://doi.org/10.2139/ssrn.2512808","url":null,"abstract":"We study the association between banking crises and non-life insurance consumption using cross-country panel of data from 139 countries from 1988 to 2010. We find a persistent and excess decline in non-life insurance consumption after a banking crisis in the higher income countries. We explore several possible explanations for the decrease with additional controls, but none fully explain the observed association.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"36 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-10-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"91235545","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":"The Great Mortgaging: Housing Finance, Crises, and Business Cycles","authors":"Òscar Jordà, M. Schularick, Alan M. Taylor","doi":"10.2139/ssrn.2500610","DOIUrl":"https://doi.org/10.2139/ssrn.2500610","url":null,"abstract":"This paper unveils a new resource for macroeconomic research: a long-run dataset covering disaggregated bank credit for 17 advanced economies since 1870. The new data show that the share of mortgages on banks’ balance sheets doubled in the course of the 20th century, driven by a sharp rise of mortgage lending to households. Household debt to asset ratios have risen substantially in many countries. Financial stability risks have been increasingly linked to real estate lending booms which are typically followed by deeper recessions and slower recoveries. Housing finance has come to play a central role in the modern macroeconomy.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"11 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77035118","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}
Maria Dolores Gadea Rivas, Ana Gómez-Loscos, Gabriel Pérez-Quirós
{"title":"The Two Greatest. Great Recession vs. Great Moderation","authors":"Maria Dolores Gadea Rivas, Ana Gómez-Loscos, Gabriel Pérez-Quirós","doi":"10.2139/ssrn.2497536","DOIUrl":"https://doi.org/10.2139/ssrn.2497536","url":null,"abstract":"The collapse of the global economy in 2008, following the outbreak of the financial crisis, and the ensuing economic developments of the so-called Great Recession (GR) led many economists to suggest that the Great Moderation (GM) had, indeed, come to an end. This paper offers evidence that the decrease in output volatility still remains in force despite the GR and would do so even if the GR continues to extended horizons. This finding has important implications not only for academics, concerning the implementation of theoretical and empirical techniques, but also for policymakers, regarding the understanding of the pattern of recovery from the current and future recessions","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"73 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79211426","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":"Socio-Economic Rights, Economic Crisis, and Legal Doctrine: A Reply to David Bilchitz","authors":"Xenophon Contiades, A. Fotiadou","doi":"10.2139/ssrn.2501471","DOIUrl":"https://doi.org/10.2139/ssrn.2501471","url":null,"abstract":"In his interesting criticism of our article, “Social Rights in the Age of Proportionality,” David Bilchitz rejects the potential of proportionality to give content to social rights. Proportionality is perceived as a “formal test ... that helps decision-makers reach determinations as to the circumstances in which it is permissible to limit rights,” which “only works if we have a pre-existing understanding of the content of particular rights and the weights to be accorded to them.” This preexisting content idea is central to the author’s argumentation, being considered a precondition for the examination of necessity and stricto sensu proportionality as well as for the dialogical approach, which he thus also rejects as a content-creating device. His criticism will be addressed at two interrelated levels. First, we will examine whether the conceptualization of proportionality and its relation to the content of rights employed by Bilchitz is theoretically sound; and, second, we will check whether the financial crisis experience so far offers arguments for or against his position. We shall argue that the author, embracing an outdated understanding of both proportionality and rights, agonizes to find ways of protecting social rights in the context of the current financial crisis in a manner quite detached from the emerging legislative and jurisprudential reality. Failure to take into account recent narratives of proportionality and ignoring the new facets of the doctrine explains his objections.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"8 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-07-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"89219215","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":"Foreign Banks and International Shock Transmission: Ownership Matters No More","authors":"Ying Xu, H. A. La","doi":"10.2139/ssrn.2443229","DOIUrl":"https://doi.org/10.2139/ssrn.2443229","url":null,"abstract":"This paper studies the recent (2007-2009) Global Financial Crisis and its transmission through bank lending to emerging Asian economies. It highlights two channels of shock transmission identified in the literature: bank ownership and liquidity. We find that the bank ownership does not play a substantial role in the transmitting process. It is the liquidity channel measured by lending in foreign currency that is mainly responsible for the GFC transmission to the loan market in Asia, albeit the effect on the credit market is likely to be small. Additionally, our results suggest that the contraction of foreign currency liquidity is partially substituted by domestic currency lending. However, the substitution occurs only within banks and not between banks owing to high switching costs. We employ a unique dataset on new loan issuance to Asian borrowers and apply a recently developed method (Khwaja and Mian 2008) to address the identification problem in examining bank lending and shock transmission. Our results are robust according to a number of sensitivity analyses.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"115 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-04-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80821995","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":"Пропусти регулаторних тела и рејтинг агенција у ескалацији хипотекарне кризе (Faliures of Supervisory Bodies and Rating Agencies in Mortgage Crisis Escalation)","authors":"Perica Jankovic","doi":"10.2139/SSRN.2433801","DOIUrl":"https://doi.org/10.2139/SSRN.2433801","url":null,"abstract":"The financial crisis is a result of the irresponsible business policy of the relevant state institutions for the financial market control (the US Federal Reserve and the US Security and Exchange Commission) and the lack of competence of rating agencies, as well as fundamental weaknesses that have existed for years in the area of financial control and regulation in the United States. The mentioned weaknesses originate in the idea of unlimited liberalization of financial markets, with minimal regulation and weak business control of the investment banks and funds.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"40 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-03-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78365135","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":"A Crisis Beyond Law, or a Crisis of Law? Reflections on the European Economic Crisis","authors":"Ioannis Glinavos","doi":"10.2139/ssrn.2407459","DOIUrl":"https://doi.org/10.2139/ssrn.2407459","url":null,"abstract":"This paper attempts to locate the place of law in debates on the economic crisis. It suggests that law is the meeting point of politics and economics, not simply the background to market operations. It is suggested therefore that the law should be seen as the conduit of popular will through political decision making onto economic systems and processes. The paper argues that the crisis can be seen as being the consequence of the dis-embedding of the political from the economic, and it is this distance that causes legal frameworks to operate in unsatisfactory ways. With this theoretical basis the paper examines the sovereign debt crisis in Europe. The European debt crisis in general and the plight of Greece in particular show why plasticity in policy making is necessary, and also reveal why current orthodox solutions to economic calamities fail. The inflexibility of the neoclassical understanding of the state-market relationship does not allow for avenues out of crisis that are both theoretically coherent and politically welcome. Such realizations form the basis of the examination of the rules framing the Eurozone. This paper after conducting an investigation of exit points from the Eurozone condemns the current institutional framework of the EU, and especially the EMU as inflexible and inadequate to deal with the stress being placed on Europe by the crisis.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"138 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-03-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76170346","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":"Haircut Undone? The Greek Drama and Prospects for Investment Arbitration","authors":"Ioannis Glinavos","doi":"10.1093/JNLIDS/IDU008","DOIUrl":"https://doi.org/10.1093/JNLIDS/IDU008","url":null,"abstract":"As a result of the sovereign debt crisis that engulfed Europe in 2010, investors are much more likely to pursue dispute resolution options when faced with losses. This article seeks to examine the position of investors who suffered losses in the Greek haircut of 2012 in the context of investment treaty arbitration. The article evaluates arguments that investments in Greek sovereign bonds have been expropriated by the introduction of retrofit Collective Action Clauses (CACs) and that compensation is payable as a result of the protections offered by Bilateral Investment Treaties (BITs). The article investigates whether sovereign bonds come within the definition of protected investment in BITs, assesses the degree to which CACs act as a jurisdictional bar to investor-state claims and attempts an evaluation of whether claims could be successful. The analysis uses as an illustration a recent case brought against Greece at ICSID. The article concludes by considering whether the Greek haircut was expropriatory and reflects on the possible outcome of current arbitrations.","PeriodicalId":20862,"journal":{"name":"PSN: International Financial Crises (Topic)","volume":"29 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2014-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78285891","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}