Displaying from 31 to 40 of 90 available piece of news category "Article"
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Proportional clearing mechanisms in financial systems
We address the problem of clearing mutual obligations among agents when a financial network collapses. To do so, we adopt an axiomatic approach and provide the first comprehensive characterization of the rules based on the principle of proportionality, covering the entire domain of financial systems. While a previous attempt by Csóka and Herings (2021) tackled this issue in a context where agents have strictly positive initial endowments, we show that their properties do not fully capture the set of proportional rules when extended to the full financial systems' domain. To overcome this limitation, we introduce new properties that emphasize the value of equity of the firms in the network. We show that a clearing mechanism satisfies compatibility, limited liability, absolute priority, equity continuity, and non-manipulability by clones if and only if each agent receives a payment proportional to the value of their claims. This characterization holds in the framework studied by Csóka and Herings (2021)
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Contribution of major economies to global GDp and product reallocation around the world
Economic globalization has led to production increasingly becoming concentrated in certain re- gions and countries of the world.
This article develops an accounting framework to provide the trends for the contribution of countries to global gross domestic production (GDP). In particular, the method transforms the multiregional input-output model to quantify the relative importance of individual economies to world GDP. The proposal uses a world input-output database that distinguishes between three main economic areas: China, the United States of America and the European Union.
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Leaders, factions and the determinants of electoral success
We model the internal game between the leader and the factions of a party, to study the effect of party leadership on the determinants of electoral success. Factions are of interest or of principle. The probability of winning the election is increasing in how close the party is to the median voter, the leader's charisma, party coherence and the factions' contributions.
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Studies about the impact of recent economic crises
Empirical economic analyses allow to feed these reasoning and models and validate or refute their predictions. In addition, the increase in the quantity and quality of economic data, together with the development of empirical methods that, for example, make it possible to advance in the identification of causal effects, means that applied economics exercises provide increasingly informative and reliable evidence for decision-making and assessment of policy interventions. In short, the contributions of the field of applied economics are today more important than ever due to the need to shed light on the real drivers and consequences of (socio)economic phenomena.
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The Effects of High Risk on International Stock Markets
We conduct an international analysis of the cross-sectional risk premiums of uncertainty risk factors in addition to traditional risk factors. We consider international stock markets in five regions separately. We measure uncertainty by the local and US economic policy uncertainty indices. Economic policy uncertainty risk has negative risk premiums. This implies that investors get lower returns for assets with high uncertainty betas. We further analyze a nonlinear relationship between excess returns and uncertainty risk by adding the downside economic policy uncertainty risk factor which captures high levels of uncertainty, similar to downside market risk. The downside uncertainty risk factor has negative risk premiums
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Defining an ‘Epidemiological Risk Index’ to analyse COVID 19 mortality across European regions
The spread and severity of COVID-19 within the European regions have been highly heterogeneous, with significant differences in both the number of infected persons and mortality across regions. This paper improves the weak ability of welfare variables, such as the HDI, to explain COVID-19 mortality.
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Ideological alignment, public sector size and tax morale: empirical evidence from OECD economies
This paper examines the relationship between the ideological alignment of citizens with their governments, the size of the public sector, and taxpayers' intrinsic motivations to pay taxes. By analyzing data from the World Values Survey and the European Values Study for 23 OECD economies from 1995 to 2018, the study uncovers distinct patterns in tax morale based on ideological differences.
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Market power in California's water market
The authors study the extent and impact of market power in water markets. Such markets are not abundant globally but their prevalence has been increasing. They use a Nash-Cournot model and derive a closed-form solution for the extent of market power in a water market setting. The authors then use this solution to estimate market power in a newly assembled dataset on California's statewide surface water market. California is one of the world's largest water markets by quantity and value of water traded.
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Towards a risk-adjusted tourism and travel competitiveness index
The concept of Tourism Destinations Competitiveness has evolved from a price-focused perspective to the consideration of multiple factors including sustainability, residents' well-being, or destination image. Regardless of the version used, it is expected that a competitive destination should be able to convert its advantageous position into economic returns. However, the pandemic has come to upset the foundations of the sector, since many of the destinations traditionally classified as highly competitive have also been the most affected by the pandemic. In this paper, we propose to review the notion of competitiveness by considering properly the dimension of inherent risk, using specific composite indexes, and adjusting conventional competitiveness indicators including these dimensions. We revise the results of these new adjusted by risk competitiveness indexes for the organization for economic cooperation and development (OECD) and OECD partner countries. Among other relevant points, the findings indicate relevant changes in rankings when we explicitly include risk in the competitiveness calculations.
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Information and Optimal Trading Strategies with Dark Pools
In today's financial markets traders have access to competing trading venues with different levels of transparency for buying or selling assets. In addition to transparent exchanges, market participants can also trade in opaque trading venues such as dark pools. In December 2022, dark pools accounted for 13.75% of the US equity volume in the United States, and 7.50% of the total value traded in European markets. Dark pools often foster price improvement in relation to exchanges, but pose execution risks. In this context, information asymmetries play a fundamental role in investors' decision of where to trade and in the price discovery process. Therefore, a better understanding of the competition between an exchange and a dark pool with the presence of asymmetric information is essential.
