Global Market Integration Research Articles

Analysis of the Role of HS-HKRVM Analytic Hierarchy Process in the Evaluation of English Teaching Quality

With the development of global market integration, the demand for English professionals in various industries is growing, and the professional standards for English professionals are also getting higher and higher. Therefore, English education is also faced with many opportunities and challenges; especially, the comprehensive education quality of English majors is becoming more and more prominent. The traditional teaching method using test scores as the evaluation standard leads to boring courses, students are not very interested in learning, and they cannot appreciate the charm of disciplines and majors, resulting in prominent problems in teaching form. This paper first analyzes the idea of the English learning quality evaluation system and then analyzes the English learning quality evaluation system based on HS-HKRVM. This paper also analyzes the construction of the English learning quality evaluation system based on the analysis layer process and finally studies the construction of the English learning quality evaluation system based on HS-HKRVM. Experiments show that HS-HKRVM can play a great role in the evaluation and improvement of English teaching quality.

Global factors and stock market integration

We propose a novel approach for generating global factors to measure global equity market integration using a panel data model with cross-sectional dependence (CD). Based on the previous literature, our global factors are obtained by explicitly controlling the effects of local factors of different regions in one asset pricing model, which further provides an integration measure based on the adjusted-R2. We empirically investigate the dynamics of global integration from 1990–2017 and find that (1) the integration measure based on the considered developed markets shows a slightly upward trend during our sample period, (2) the main driving force behind volatility in global integration arose from the Asia-Pacific (excluding Japan) region, and (3) integration between North America, Europe and Japan showed a relatively flat and moderate trend.

The diversification benefits and policy risks of accessing China’s stock market

China’s stock market (the “A share market”) has a lower correlation with the global market and is less affected by international financial contagions than any other major economy. The inclusion of mainland China stocks into an international portfolio increases its Sharpe ratio. However, we find that Chinese stocks providing the most diversification benefits also carry the most policy risk for international investors. Holding Chinese stocks listed in Hong Kong does not reap the same diversification benefits. While global market integration and the increase in foreign ownership can diminish diversification benefits, mainland China stocks still provide valuable diversification opportunities for international investors up till the most recent time in late 2010s.

The impact of agricultural trade approaches on global economic modeling

Researchers explore future economic and climate scenarios using global economic and integrated assessment models to understand long-term interactions between human development and global environmental changes. However, differences in trade modeling approaches are an important source of uncertainty in these types of assessments, particularly for regional projections. In this study, we modified the Global Change Analysis Model (GCAM) to include a novel logit-based Armington trade structure, to examine two approaches to modeling trade: (1) an approach that represents segmented regional markets (SRM), and (2) an approach that represents integrated world markets (IWM). Our results demonstrate that assuming IWM, i.e., homogeneous product modeling and neglecting economic geography, could lead to lower cropland use (i.e., by 115 million hectares globally) and terrestrial carbon fluxes (i.e., by 25%) by the end of the century under the default GCAM scenario, compared with the logit-based Armington SRM structure. The results are highly heterogeneous across regions, with more pronounced regional trade responses driven by global market integration. Our study highlights the critical role that assumptions about future trade paradigms play in global economic and integrated assessment modeling. The results imply that closer harmonization of trade modeling approaches and trade parameter values could increase the convergence of regional results among models in model intercomparison studies.

Commonality in mutual fund flows and global market integration

Commonality in mutual fund flows and global market integration

Investigating financial opportunities for traditional clothing industry in South Asia based on an analysis of internationally diversified portfolio using ARCH and GARCH models

This paper investigates the benefits of forming an internationally diversified portfolio in the stock markets of Bangladesh, India and Pakistan using the stock market indices data from April 2013 to March 2020. The portfolio comprises of three stock market indices from Pakistan, India and Bangladesh. The goal is to identify financial opportunities for traditional clothing industry in South Asia. Bangladesh, India and Pakistan are neighbouring countries in South Asia. Tradition, culture and specific ethnic elements influence traditional clothing in the case of the selected country cluster consisting of Bangladesh, India and Pakistan. Our empirical results indicate that internationally diversified portfolio does not reduce the risk due to global market integration in the background. Furthermore, ARCH and GARCH models reveal that large change in conditional variance is followed by large changes in conditional variance whereas small change in conditional variance is followed by small changes in conditional variance.

IFRS convergence and international trade: evidence from China

Using a comprehensive dataset of firm-level export transactions from China Customs, this paper investigates whether mandatory International Financial Reporting Standards (IFRS) convergence promotes Chinese firms’ export activities. We find that compared with private firms which were not immediately required to comply with the new accounting standards in 2007, listed firms experienced a significant increase in their exports after converging with IFRS. The positive effect of IFRS convergence on exports only occurred when firms traded with IFRS countries and when they were non-state-owned enterprises. The findings are robust to a battery of sensitivity tests. We contribute to the literature on the real economic effects of IFRS harmonisation by documenting its role in enhancing international trade and global product market integration.

Time-varying Integration of Stock Markets from Global and Regional Perspective in Asia-Pacific

This study investigates the time-varying integration of stock markets from a global and regional perspective, the consequences of two major global financial crises, i.e., the Asian Financial Crisis and the subprime mortgage, and the Crisis triggered by COVID-19. We contribute to the growing amount of literature on market integration, especially on the role of regional to global market integration. Although regional integration encourages an acceleration of global integration, the effect of a regional factor is not uniform among regions. It is important to understand regional to global market integration and the consequences during the crises. This study employs time-series data from economic territories based on the Morgan Stanley Capital International (MSCI) Asia-Pacific classification. It introduces an alternative measurement of time-varying integration by considering the correlation of regional and global markets using a simple international model, equivalent to the capital asset pricing model (CAPM). The result shows that the market integrations are time-varying both globally and regionally. The domestic markets are affected by the global market and its regional market, as the role of a regional market emerges during the financial crisis period. We find the different responses of stock markets during the Covid-19 period as a dominant factor to exacerbate the market return globally. In the long run, the upward trend for the regional market integration in both developed and emerging markets is inherent to the global market integration.DOI: 10.26905/jkdp.v25i3.5822

The role of global agricultural market integration in multiregional economic modeling: Using hindcast experiments to validate an Armington model

The representations of international trade and global market integration play central roles in long-term global agricultural economic modeling. However, the conventional use of the gravity models (i.e., the Armington approach) of trade may not adequately account for the dynamic process of market integration. In this paper, we generalize a logit-based Armington approach by permitting home preference bias erosion to account for a trend of global market integration. We build a simple agricultural economic equilibrium model and conduct hindcast experiments to examine the historical trend of market integration. The results show a significant integrating trend of the global agricultural market implied by converging Armington preference distributions (i.e., home bias erosion) in 1995–2015. We demonstrate important implications of allowing the dynamic trend of market integration implied by bias erosion on estimating trade elasticities. By testing the future market integration trend implied by historical home bias integration in the Global Change Analysis Model (GCAM), we show a high sensitivity of long-term agroeconomic projections to future trade and market integration scenarios.

Global market integration, efficiency orientation, and drivers of foreign subsidiary divestments

Differences in global market integration across industries have important repercussions for MNC strategy and the drivers of manufacturing subsidiary divestment decisions. Global industry integration and the associated competitive pressures lead MNCs to adopt cost efficiency strategies for their subsidiary networks, and subsidiary divestment decisions are strongly driven by labor cost considerations. In non-integrated industries, host country demand conditions are the prime driver of divestments. These patterns are the most salient for MNCs that have aligned their strategy with the global industry environment. Analysis of the divestment hazards of 3827 Japanese manufacturing subsidiaries in 57 countries provides support for these conjectures.

Does regulatory cooperation help integrate equity markets?

This study tests whether cooperation between securities regulators influences global market integration. I measure cooperation using arrangements between securities regulators that enable enhanced cross-border enforcement, better regulatory decisions, and reduced compliance obligations for cross-border activities. These arrangements-formed at different times for different country pairs-are associated with an 11% increase in cross-border investment. I find similar increases using other proxies for market integration. Cross-border investment and market integration thus depend, in part, on regulators working together to extend legal and institutional capacities across borders. This reframes our understanding of the role of institutions in global capital markets.

Indonesian coffee exports and its relation to global market integration

Coffee price is an important indicator that stimulates farmers to advance their welfare. Unfortunately, coffee crisis makes the farm gate price uncertain and volatile. This study aims to explore the Indonesian coffee export situation related to price risks and coffee market integration between Indonesian coffee price and international price. The time series data were the coffee price from 1987 to 2014 in Indonesian domestic market and in global trade in London. Vector Error Correction Model (VECM) approach was applied to test market integration based on Ravallion’s equation. Based on the analysis, the results of the study revealed that Indonesian coffee export performed progressively in the last decade. Export destination countries for Indonesian coffee also developed broadly. There was market integration on the Indonesian coffee market and global price in the London terminal. Although not fully, the shock in the international price was somehow felt in the Indonesian coffee market. There were sufficient shreds of evidence to conclude that the Indonesian coffee market is well integrated with the international market in the long run. The changing coffee price in Indonesia and the International market adjusted in the next three years. In short term, Indonesian coffee price was 76% influenced by international price changes, but not vice versa.JEL Classification D49; Q02; Q17

Can Cross-Border Funding Frictions Explain Financial Integration Reversals?

Abstract We show that constraints on using leverage for foreign positions can act as an international investment barrier. Guided by an international CAPM with leverage constraints, we use observed stock prices to measure the variation in the magnitude and the implicit cost of such cross-border funding barriers. Our measure helps explain the dynamics of global market integration and, in particular, its reversals documented in the literature, but not explained by other international investment barriers. We confirm our results using alternative financial integration measures, international capital flows, and institutional portfolio holdings.

The Research of Multinational Enterprises Transnational Management

With the development of global business, MNEs are always sinking into various pressures which are related to economic factors, social factors and informational factors. This situation making MNEs’ strategies is supposed to achieve those requirements that including global market integration, national responsiveness, worldwide learning. There are four important strategies which are widely used in MNEs internationalization process that including multinational strategy, global strategy, international strategy, and transnational strategy. This essay will introduce pursuing transnational strategy and some difficulties existing in this process. Furthermore, an example of an entrepreneurial subsidiary will be chosen to explore and conduct further research.

Trade Policies and Entrepreneurial Initiatives: A Nexus for India's Global Market Integration

In the context of India's integration into global markets, this study investigates the relationship between India's trade policies and its entrepreneurial efforts. The primary objectives are to examine the impact of trade policies on entrepreneurship, analyze how entrepreneurial activities influence the design of trade policies, identify mechanisms that support India's integration into global markets, and provide policy suggestions. This study analyzes scholarly articles, government publications, and industry reports using an approach based on examining secondary data. The most important findings shed light on the mutually beneficial link between trade policies and entrepreneurial endeavors, the significance of trade liberalization for market access, and export-oriented entrepreneurship's role in India's integration into global commercial markets. In the context of policy implications, the necessity for holistic policy approaches, flexibility in policy design, measures to build capacity for entrepreneurs, involvement with stakeholders, and constant monitoring and evaluation is emphasized. Through this nexus, India has the potential to open up opportunities, improve its competitiveness, and establish itself as a significant player in the world economy.

Weathering financial crisis in China: the role of global market integration

ABSTRACT We test the hypothesis that the integration of China into the global financial system, as a consequence of domestic market reforms, reduced the effectiveness of intervention efforts during the stock market crises. Using an event study methodology in tandem with the DCC GARCH and Markov Regime Switching models, we investigate whether the interventions were able to address the decline in market returns and volatility during the 2008 and 2015 stock market collapses. Results show that the 2015 measures were ineffective compared to the 2008 ones and that the increasing global integration of the Chinese market played a significant role in their failure. This study is the first of its kind and the results have important implications for policymakers, given the vital position of China in the international economy.

A magic formula for economic development? Global market integration and spatial polarization in extractive industries

ABSTRACT The World Bank, World Trade Organization and others promote integration into global markets as a certain path towards economic development. Some researchers share this optimism, arguing that development is the record of how one thing leads to another, once peripheral locations have plugged into global networks. Comparing resource peripheries in South America, Southeast Asia and Sub-Saharan Africa with regard to the upstream oil and gas sector, we call for a more nuanced assessment. Against the backdrop of 38 narrative, open-ended interviews, we show that there is spatial polarization between ‘gateways’ and peripheral sites in Southeast Asia. Argentinean and Ghanaian case studies reveal that local firms usually provide generic services, with little prospects of venturing into higher value-adding activities. We conclude that at least the oil and gas sector is not suitable for fulfilling very optimistic expectations on development.

Drivers of Economic and Financial Integration: A Machine Learning Approach

We propose a new approach to identify drivers of global market integration using an advanced machine learning technique. We differentiate across economic and financial integration as well as across emerging and developed countries. Our approach allows for nonlinear relationships, corrects for over-fitting, and is less prone to noise. Moreover, it is able to tackle a large number of highly correlated explanatory variables and controls for multicollinearity. Results suggest that general economic growth, increasing international trade, and contained population growth have helped emerging countries to catch up to the level of the economic integration of developed countries. However, slow financial development and a high level of investment riskiness have hindered the speed of emerging countries' financial integration. Furthermore, the results suggest that integration is a gradual process and is not driven by cyclical or transitory events.

Institutional Conditions of Economic Globalization: Effects of Antitrust and Merger Laws on the Global Integration of the Acquisition Market1

A central insight from institutional theory about markets is that they cannot operate without governing rules to guide interactions among actors. Because most of these rules are made and enforced within national borders, international economic transactions are said to suffer from an “institutional abyss,” the lack of institutional arrangements for economic exchanges. Scholars have found that the abyss can be filled by two factors: network connectedness, such as inter‐governmental organizations, and intercountry economic agreements, such as the World Trade Organization or free trade. This article proposes a third factor: the global diffusion of governmental regulations. When countries adopt highly standardized regulations on a particular transaction, it provides legal familiarity for foreigners and reduces procedural uncertainty surrounding how the transaction should be executed. Using fixed‐effects models on longitudinal data, I show that the adoption of antitrust and merger laws increases the volume of cross‐border mergers—the transaction the laws are meant to regulate. This result stands in direct opposition to financial scholars’ predictions that antitrust and merger laws will reduce cross‐border mergers because the laws are meant to restrain, not liberate, the transaction. This article theorizes how the diffusion of regulations, not the elimination of regulations, can facilitate global market integration.

Assessing Financial Market Integration in Vietnam: A Price – Based Approach

This paper investigates the existence of financial market integration between Vietnam and the region (ASEAN, ASIAN) as well as the world using price-based indicators. Our paper is the first to assess the overall integration of the Vietnam financial market based on two different datasets for different sub-capital markets, the bond market and stock market, during the period of 2009 - 2018. The empirical results show that Vietnam, compared to other countries in research, holds lower regional and international integration levels in both the bond market and the stock market, but demonstrates considerably strong signs of progressing regional and global stock market integration over the period. Especially, the absolute values estimated from the beta coefficient and beta convergence approaches for the Vietnamese stock market are larger than for the bond market, proving better convergence degree and speed of Vietnamese stock market over the bond market. These bring policymakers and regulators new thoughts and more challenges in designing appropriate policies towards the development of the financial markets in the future.