Market Transparency Research Articles

The Efficiency of Stock Exchange Self-Regulation: Evidence from Stock Market Liquidity and Transparency

This study examines whether and how stock exchange self-regulation affects stock market liquidity and corporate transparency. Using a large sample of firms from 46 stock exchanges from 2001 to 2015, we find significant and robust evidence that firms listed in self-regulated stock exchange are associated with fewer zero-return days, lower daily stock price variation, higher stock trading volume, smaller analyst forecast errors, lower discretionary accruals and less earnings management. These findings are more pronounced when the stock exchange has a strong self-regulation model rather than a limited self-regulation model. Also, our results are robust in different-in-difference tests based on the Australian Securities Exchange’s change from strong self-regulation model to a government regulation model. Further, when a firm from a country with a government-regulated stock exchange is cross-listed in a self-regulated stock exchange, the firm has higher liquidity and transparency than the matched firms. In addition, we find that self-regulated exchanges set more detailed insider trading and disclosure rules and are more transparent with their rules and rule enforcement. Overall, our study suggests that stock exchange self-regulation improves the efficiency of stock market regulation.

Praktik insider trading sebagai bentuk pelanggaran prinsip keterbukaan informasi dalam pasar modal di Indonesia

This study discusses the legal protection of investors against the practice of insider trading in the capital market in Indonesia and violations / crimes of insider trading is a form of violation of the principle of information disclosure in the capital market. The purpose of this study is to analyze the legal protection of investors against the practice of insider trading in the capital market in Indonesia and violations / crimes of insider trading is a form of violation of the principle of information disclosure in the capital market. This research uses the normative juridical method. The approach used is the Invitation-invite approach. The legal material used is primary legal material and secondary legal material. Legal material collection techniques used through library studies. Technical analysis used with deductive logic, which draws conclusions from general to specific. The results of the study are difficult to provide a legal protection for investors due to Insider Tranding practices, due to weaknesses in the Capital Market Law for the enforcement of insider trading practices in the Capital Market and Insider Trading is a form of violation of the principle of information disclosure in the Capital Market, even though the purpose of the principle of information disclosure itself is to guarantee transparency in the capital market. DOI. https.//doi.org/10.26905/idjch.v11i1.3528.

Improving market outcomes: A qualitative assessment of the Greek dairy supply chain

This study provides a qualitatative assessment of the overall outcomes of the dairy supply chain in Greece. Based on the framework of the Taskforce for Agricultural Markets, a questionnaire survey with in-depth interviews was conducted to farmers, industries and supermarkets in Greece in order to gain knowledge about trading practices, market transparency, risk management, contracts, access to finance and the role of Producer Organizations. The analysis did not reveal significant unfair trading practices and showed positive prospects for the overall supply chain.

Determining the Most Important Variables for Women’s Entrepreneurship Crisis Management by Neuro Fuzzy System

Without the active participation of women in all facets of life economic development cannot be accomplished. There is consensus among scholars that women may play a key role in the phenomenon of entrepreneurship. The proportion of the contribution of women to economic and social development depends on the institutions ' promotion of gender equality and gender blind support. While women make up about fifty per cent of the world’s population, they have less opportunity to control their lives and make decisions than men. Women entrepreneurs have been named to bring prosperity and education to the developing countries as the new growth drivers and the rising stars of economies. The main objective of the analysis was to examine the impact of internal market dynamics, internal market transparency, physical and service infrastructure and cultural and social norms on the forecasting of total and female entrepreneurial activities. Since this is the highly nonlinear job the soft computing approach has been applied in this analysis. The Process for ANFIS (adaptive neuro fuzzy inference system) was applied to determine the most important variables for both total and female entrepreneurial activity. To order to better understand this trend, rapid growth and involvement of women to entrepreneurship and the growing research body creates a need for both general and unique theoretical perspectives and approaches.

ОСОБЛИВОСТІ ДЕРЖАВНОГО РЕГУЛЮВАННЯ СТРАХОВОГО РИНКУ УКРАЇНИ У ТРАНСФОРМАЦІЙНИХ УМОВАХ

Досліджено роль держави у процесі регулювання страхової діяльності. Здійснено аналіз сучасного стану страхового ринку, виявлено низку невирішених питань, що стримують його розвиток.Проаналізовано рівень проникнення страхування в Україні та країнах Європи, ступінь концентрації ринку страхування, рівень капіталізації. Досліджено тенденції розвитку страхового ринку в Україні та за кордоном. Наведено перешкоди розвитку страхового ринку в Україні. Охарактеризовано основні напрями реформування страхового ринку України відповідно до бачення НБУ майбутнього регулювання страхового ринку України. Розглянуто зарубіжний досвід функціонування єдиного фінансового мегарегулятора, а також особливості та можливий ефект від його впровадження на базі Національного банку в Україні. Здійснено порівняльний аналіз основних розходжень директив Solvenсy І і Solvenсy ІІ. Оцінено можливості та очікувані наслідки імплементації вимог директиви Solvency ІІ у діяльність українських страхових компаній. Наведено завдання, що стоять перед новим регулятором страхового ринку.Наголошено на важливості забезпечення прийнятного процесу виходу страхових компаній з ринку, а також доцільності створення системи гарантування виплат за договорами довгострокового страхування життя (на основі зарубіжного досвіду — використання моделі Ex-ante).

Transparency in an Opaque Market Auction Prices as Anchors and Guideposts

This paper highlights the paradoxical effects of increased price data in markets with difficult-to-value products where non-price factors are highly relevant. In the fine art market, the growth of market information providers facilitated access to auction price data, beneficial in a market noted for its clandestine dealings. Drawing from inductive ethnographic research, the paper notes complex outcomes from increased data availability, as auction prices can be seen as an indicator of an artwork’s value. The findings deconstruct factors of supply, demand and multiple prices in the art market, highlighting important non-price factors in valuation, which complicates provider claims of art market transparency. Unpacking the process through which expert “thick” valuation transforms raw price data into comparables and then valuations helps to explain continuing differences in valuation, with buyers prone to understand past prices as market or reference prices, rather than raw materials for valuation that are adjusted for complexity. This contributes to an understanding of both advantages and predictable problems from increased price data in markets that contain substantial qualitative and non-numerical data, as evaluative frictions can occur in the absence of clearly defined alternative valuation methods. This develops productive linkages between critical transparency and the valuation and evaluation research.

State regulation of ecotourism in the context of European experience

The article is devoted to the research of the European experience in the development of ecotourism and the features of its support and regulation by the state; analysis of the development of the tourism sphere, in particular ecotourism in the leading countries of Europe; consideration of models of state regulation of tourism in European countries; the analysis of the modern development of ecotourism in Ukraine is given, in accordance with which identified the main reasons for the low activating its ecotourism development; the regulatory framework for the development of the domestic tourism sphere has been investigated; proposed the introduction of the necessary state tools for managing and regulating the development of tourism business in the relevant areas.
 The purpose of the article is to study the European experience in the development of ecotourism and the development of proposals for its use at the level of public administration and regulation of the development of ecotourism.
 The scientific novelty is to justify the necessity to introduce a number of state instruments for managing and regulating the development of tourism business in the relevant areas in order to ensure the economic growth of domestic ecotourism, as the main platform for socio-economic reconstruction of rural areas.
 Conclusions. The use of European experience in the development of the tourism business in Ukraine will contribute to the development and implementation of various areas of management and coordination of domestic ecotourism, the strategic goal of which should be the creation of a competitive tourism product that can satisfy the needs of external and internal tourists. For Ukraine, the third management model is acceptable in the form of organization of the tourism sphere and the ranges of world tourism. However, ensuring the effectiveness of its development requires at least partial funding for the country's participation in the creation of an appropriate monitoring, accounting, and control over the efficient use of recreational resources; creation of a transparent marketing platform; development of provincial and regional tourism development programs; synchronization of travel agencies with transfer organizations, cultural institutions, farmsteads, agro-formations; creation of appropriate consulting centers; the introduction of a classification systematization of rest places, etc.

Real estate market transparency and default on mortgages

This paper investigates the relationship between real estate market transparency (RET) and default on mortgages (DOM). Using data from 46 countries for the period of 2006–2016, we find evidence that there is a negative and significant relationship between RET and DOM. This result is robust with the inclusion of control variables and different estimation methods including panel fixed effects and generalized method of moments (GMM). We also find that the association between RET and DOM is more apparent in emerging economies than high-income countries.

Designing a Blockchain Model for the Paris Agreement’s Carbon Market Mechanism

This paper examines the benefits and constraints of applying blockchain technology for the Paris Agreement carbon market mechanism and develops a list of technical requirements and soft factors as selection criteria to test the feasibility of two different blockchain platforms. The carbon market mechanism, as outlined in Article 6.2 of the Paris Agreement, can accelerate climate action by enabling cooperation between national Parties. However, in the past, carbon markets were limited by several constraints. Our research investigates these constraints and translates them into selection criteria to design a blockchain platform to overcome these past limitations. The developed selection criteria and assumptions developed in this paper provide an orientation for blockchain assessments. Using the selection criteria, we examine the feasibility of two distinct blockchains, Ethereum and Hyperledger Fabric, for the specific use case of Article 6.2. These two blockchain systems represent contrary forms of design and governance; Ethereum constitutes a public and permissionless blockchain governance system, while Hyperledger Fabric represents a private and permissioned governance system. Our results show that both blockchain systems can address present carbon market constraints by enhancing market transparency, increasing process automation, and preventing double counting. The final selection and blockchain system implementation will first be possible, when the Article 6 negotiations are concluded, and governance preferences of national Parties are established. Our paper informs about the viability of different blockchain systems, offers insights into governance options, and provides a valuable framework for a concrete blockchain selection in the future.

Corporate social responsibility, family ownership and earnings management: the case of Indonesia

PurposeThis paper aims to examine the association of corporate social responsibility (CSR), family ownership and earnings management.Design/methodology/approachThe authors specifically examine mining companies listed in Indonesia Stock Exchange during 2012-2014. Total observations are 105 firm-years. Research data are collected from sustainability reports, annual reports and annual financial statements. Data are analysed using panel data regression.FindingsThe evidence suggests a negative association between corporate social responsibility disclosures (CSRDs) and earnings management. The authors also examine the direct and moderating role of family ownership. The authors find a positive association between family ownership and earnings management. In addition, family ownership strengthens the negative association between CSR and earnings management.Research limitations/implicationsThis research only examines mining companies listed in Indonesia Stock Exchange, which limit the generalisation of the results.Practical implicationsThe results should useful for: investors wishing to use the level of CSRD as an indicator of firm ethics, especially in relation to family-owned firms; capital-market regulators wishing to improve market transparency by introducing requirements to encourage more CSRD; and other users of financial statements, especially financial analysts to consider ownership structure, specifically family ownership.Originality/valuePrevious studies have mainly focussed on companies in the USA. This paper adds to the body of knowledge regarding whether the positive relationship between family ownership and CSR is also present outside the USA, especially in emerging countries. Further, this study examines the effect of family ownership on the association of CSR and earnings management, which rarely examined in previous studies.

‘Trust Me, I’m Fair’: Analysing Google’s Latest Practices in Ad Tech From the Perspective of EU Competition Law

In a first paper released in January 2019, we explained the mechanics of online display advertising and real-time bidding with a focus on the tools and technologies comprising the ad tech market. We identified Google as the leading, and most likely dominant player across the ad tech value chain and expressed the concern that it engages in prima facie anticompetitive conduct, in that it uses its leading ad server to favor its ad intermediation business and exclude competitors. We also explained how the lack of competition across the ad tech value chain enables Google to exploit advertisers and publishers by charging hidden fees for ad intermediation on top of its disclosed commissions. In March 2019, Google announced that it would switch to a first-price unified auction by the end of 2019, arguing that its move would help create a fair and transparent market for everyone. Meanwhile, online advertising has attracted significant regulatory interest in the EU, the USA and Australia. In this new paper, we analyse whether Google’s switch to a unified auction has addressed the concerns we expressed in our first paper. We conclude that this is not the case. Google’s latest switch does nothing to increase auction transparency. Worse, it seems to strengthen Google’s ability to extract hidden margins from its customers, while undermining the competitive pressure exercised by header bidding. If substantiated, Google’s conduct could result in significant welfare losses for publishers, advertisers and ultimately consumers. We conclude our paper by suggesting various structural and behavioral remedies that could help restore competition in ad tech should our concerns be substantiated.

Marketing Channel and Margin Analysis of Wheat the Case of Debre Elias Woreda, North Western Ethiopia

The result of this study was analyzing the market chain of wheat in Debre Elias woreda. Specifically aims to analyze the market structure-conduct-performance of wheat market. To collect primary data, 154 wheat producers were selected using simple random sampling method and 31 traders were selected purposively. To address the objectives of the study, descriptive statistics were used. The result indicated that Debre Elias wheat market was inefficient, characterized by oligopolistic market structure. The major barrier to enter into the market was shortage of capital. Licensing and years of trading experience did not hinder entry into wheat trading activities. Moreover, the markets were overwhelmed by information asymmetry with low degree of market transparency. Problems like oligopolistic market structure and information asymmetry made the trading business uncompetitive and inefficient. The study recommends the agricultural sector should improve wheat production capacity by providing new technologies and create stablemarket system for farmer’s surplus production.

Examining the institutional drivers of public-private partnership (PPP) market performance: a fuzzy set qualitative comparative analysis (fsQCA)

ABSTRACT This study explores whether different constellations of institutional factors create unique causal ‘paths’ to mature PPP market performance. Using fuzzy set Qualitative Comparative Analysis (fsQCA), the institutional settings of 48 different PPP markets across Latin American and the Caribbean (LAC), Central and Eastern Europe, the Middle East, and Africa (CEMA), and the Asia-Pacific region (APAC) are examined. The results show market reliability, political and social will, and regulatory regimes are necessary, but alone not sufficient, conditions for mature PPP market performance. The absence of market transparency also appears to be far less problematic for PPP market performance than previously assumed.

“Trust me, I’m fair”: analysing Google’s latest practices in ad tech from the perspective of EU competition law

ABSTRACTIn a first paper published in February 2019, we explained the mechanics of online display advertising and real-time bidding and noted that the system is extremely opaque. We identified Google as the leading, and most likely dominant player across the ad tech value chain and expressed the concern that it engages in prima facie anticompetitive conduct, in that it uses its leading ad server to favour its ad intermediation business. We also explained how lack of competition across the ad tech chain enables Google to exploit advertisers and publishers by charging hidden fees for ad intermediation on top of its disclosed commission. In March 2019 Google announced that it would be switching to a first-price unified auction by the end of 2019, arguing that its move will help create a fair and transparent market for everyone. Meanwhile, online advertising has attracted significant regulatory interest in the EU, the USA and Australia. In this new paper, we analyse whether Google’s switch to a unified auction has addressed the concerns we expressed in our first paper. Unfortunately, we conclude that Google’s latest switch does nothing to increase auction transparency. Worse, it seems to strengthen Google’s ability to extract hidden margins from its customers, while undermining the competitive pressure exercised by header bidding. If substantiated, Google’s conduct could result in significant welfare losses for publishers, advertisers and ultimately consumers. We conclude our paper by suggesting various structural and behavioural remedies that could help restore competition in ad tech should our concerns be substantiated.

The Effects of Government Licensing on E-Commerce: Evidence from Alibaba

Using proprietary data from Alibaba, we examine how the 2015 Food Safety Law (FSL) affects e commerce in China. The FSL requires most food sellers on e-commerce platforms to obtain a valid online license for retail food handling. Because the FSL was rolled out progressively, we have a rare opportunity to observe a gradual transition from voluntary certification to partial licensing and mandatory licensing. Data summary shows that, conditional on sellers with valid licensing information, those that had a better online reputation and more online food sales before the FSL tend to display their FSL license earlier on the platform, and buyers are more willing to transact with a seller after she displays her FSL license. This positive response is stronger for younger and less reputable sellers, suggesting that the license provides useful information in addition to what consumers observe on the platform. To identify the causal impact of the FSL, we compare food and non-food categories via synthetic control matching. We find that the average quality of surviving food sellers has improved after partial and mandatory licensing, partly because those who are unwilling to obtain the FSL license must exit the platform. Despite an increase in seller concentration, the platform's gross merchandise value in the food category did not decline post FSL, nor did the average sales price increase significantly one year into the full enforcement of the FSL. This suggests that the FSL does not hamper the long-run performance of the regulated market, probably because it has enhanced seller quality and market transparency on the platform.

The Effects of Government Licensing on E-Commerce: Evidence from Alibaba

Using proprietary data from Alibaba, we examine how the 2015 Food Safety Law (FSL) affects e-commerce in China. The FSL requires most food sellers on e-commerce platforms to obtain a valid, online license for retail food handling. Because the FSL was rolled out progressively, we have a rare opportunity to observe a gradual transition from voluntary certification to partial licensing and mandatory licensing. Data summary shows that, conditional on sellers with valid licensing information, those that had a better online reputation and more online food sales before FSL tend to display their FSL license earlier on the platform, and buyers are more willing to transact with a seller after she displays her FSL license. This positive response is stronger for younger and less reputable sellers, suggesting that license provides useful information in addition to what consumers have observed on the platform. To identify the causal impact of the FSL, we compare food and non-food categories via synthetic control matching. We fi nd the average quality of surviving food sellers has improved after partial and mandatory licensing, partly because those who are unwilling to obtain the FSL license must exit the platform. Despite an increase in seller concentration, the platform's gross merchandise value (GMV) in the food category did not decline post FSL, nor did the average sales price increase significantly one year into the full enforcement of the FSL. This suggests that the FSL does not hamper the long run performance of the regulated market, probably because it has enhanced seller quality and market transparency on the platform.

Price Transparency and Market Screening

We consider repeated trading by sellers with persistent private information in dynamic lemons markets. We compare the outcomes of a transparent market where past trading prices are public to those of an opaque market, where they are private. We characterize the upper bound of trading surplus in an opaque market and construct a class of equilibria in a transparent market that improves upon this bound. We conclude that price transparency is beneficial in a repeated trading environment. The advantage of price transparency is indirect and operates through the strategic tools it provides the sellers of high quality to sustain high payoffs.

Infinite but Rare: Valuation and Pricing in Marketplaces for Blockchain-Based Virtual Items

Blockchain technologies have enabled the creation of decentralized applications which let users own and transact scarce digital assets. Although still in its infancy, the industry has attracted interest from organizations such as Formula One, the NBA, and several football (soccer) clubs to create marketplaces for trading branded digital collectables. We introduce a novel dataset and study how buyers value and sellers price blockchain-based digital collectables. We find that buyers value digital collectables much like we would expect them to value physical collectables despite the near-zero marginal cost of producing digital items. Sellers appear uncertain in how to value items and have a tendency to price too high and earn a lower revenue as a result, highlighting an inefficiency resulting from a lack of price histories and a high cost of identifying comparable items in this market. We propose a machine learning approach to value items at scale and develop a proof-of-concept decision support tool to help sellers value their digital items, addressing the pressing need for information transparency in this new market.

Transparency in Fragmented Markets: Experimental Evidence

We experimentally examine pre-trade transparency in fragmented limit-order markets. Allowing traders to hide their orders encourages limit order usage. This improves measures of liquidity by increasing depth and narrowing spreads. However, because some of this depth is not displayed, market fragmentation may limit traders’ ability to capitalize on the improved liquidity. This happens when traders execute against displayed orders at worse prices than hidden orders in another market, often referred to as ‘trade-throughs.’ In our laboratory setting, increased trade-throughs due to a dark market impose costs of similar magnitude to the benefits of increases in depth leaving effective liquidity unchanged.

CROATIAN NATURAL GAS BALANCING MARKET ANALYSIS

The Network Code on Gas Balancing of Transmission Networks stimulates the development of the wholesale gas market by encouraging balance responsible parties to use standardized balancing mechanisms. To balance their portfolios, balance responsible parties can use renominations of quantities at entry and exit points, trade on a virtual trading point or trade on a trading platform. In the event of a system imbalance, Plinacro, as the operator of the gas transmission system in the Republic of Croatia, activates the balancing energy to return the system within acceptable limits. In accordance with the Rules on the Organization of the Gas Market, the Croatian Energy Market Operator performs a monthly calculation of the daily imbalance charge, trades conducted on the trading platform for balancing activities, a neutrality charge and a charge for deviation from the nominated quantities which have been analysed in this paper based on the case study of a chosen balancing group. The analyses conducted in the paper have shown that the balance responsible party may be entitled to compensation or be liable to pay compensation based on the monthly calculation of the Croatian Energy Market Operator, HROTE, depending on the value of each charge. Plinacro as the forecasting party is preparing a new model for the allocation of gas quantities that will affect the operations of gas suppliers, DSOs and especially BRPs. Based on this analysis, it could be concluded that more accurate estimated consumption for a balancing group leads to cost optimization and a more transparent gas market.