Spillover Model Research Articles

Buying from a Competitor: A Model of Knowledge Spillover and Innovation

This paper builds a game theory model that shows how buying from a competitor affects incentives to invest in innovation.

Spatial spillover effects in the labour market in a middle-income country

ABSTRACT Most macroeconomic labour literature on estimating matching functions does not consider spatial spillover effects. However, job search and vacancy-filling processes often involve neighbouring locations, as local workers can search for and fill vacancies in nearby labour markets. We estimate a spatial spillover model using annual data for a middle-income country in Latin America. Our findings show that unemployment has a positive spatial spillover effect because an increase in the labour supply raises the probability of filling a vacancy. In contrast, vacancies have a negative spillover effect because local and neighbouring vacancies compete to be filled by workers in both markets.

Network structure, dynamic evolution and block characteristics of sovereign debt risk: The global evidence

Global sovereign debt risks are escalating with the tightening of global liquidity. We apply the LASSO-VAR spillover model, network approach and block model to analyze the overall situation and time-varying characteristics of sovereign risk volatility spillover effects among 50 countries. The results show that there is a discernible cyclical pattern in the spillover effect of global sovereign risk volatility, with the spillover intensity progressively rising in each cycle, and more countries have emerged as "net risk exporters" recently. Countries and regions exhibit diverse risk spillover traits, and assume varying roles in the transmission of sovereign debt risks. The originator of a sovereign risk shock isn't necessarily its primary disseminator, underscoring the need to account for systemic significance and risk infectivity. The interlinkages among sovereign debt risk spillover blocks vary over time, given that the composition and attributes of these blocks change. Our findings provide implications for related regulators and investors.

A process model of parental executive functioning as a spillover mechanism linking interparental conflict and parenting difficulties across parenting domains.

There is a well-documented interdependency between destructive interparental conflict (IPC) and parenting difficulties (i.e., spillover effect), yet little is known about the mechanisms that "carry" spillover between IPC and parenting. Guided by a cascade model framework, the current study used a longitudinal, multimethod, multi-informant design to examine a process model of spillover that tested whether parental executive functioning (working memory, cognitive flexibility, inhibitory control) served as a mediator of the prospective associations between IPC and subsequent changes in parenting over a 2-year period. Mothers and fathers were separated into differentiated models and multiple domains of parenting were examined (i.e., authoritarian discipline and scaffolding behavior). Participants included 231 families (both mothers and fathers of preschoolers). Race was reported as White (62%), Black (21%), Mixed (8%), Asian (3%), or Other (6%) and 14% considered their ethnicity to be Hispanic/Latino. Median household income was $65,000. Results indicated that for fathers, IPC indirectly predicted domain-general parenting difficulties (increased authoritarian parenting and decreased scaffolding) via deficits in paternal cognitive flexibility (but not inhibitory control or working memory). In mothers, IPC directly predicted domain-specific parenting difficulties (decreased scaffolding only) that did not operate via maternal executive functions. Notably, these effects occurred over and above the influence of parental socioeconomic status. This study constitutes a first step toward documenting parental executive functioning as a mechanism underlying the spillover of IPC to the parent-child relationship. Family interventions intended to interrupt IPC spillover should emphasize father involvement and consider targeting parental executive functions as change mechanisms. (PsycInfo Database Record (c) 2024 APA, all rights reserved).

A TVP-VAR assessment of the spillover effects of geopolitical risk shocks on macroeconomic variability: a study of the Ghanaian economy

Our study verified the implications of the spillover of geopolitical risk (GPR) shocks to the economic crisis in Ghana. Our analysis employed the VAR-based spillover models by Diebold and Yilmaz (Int J Forecast 28:57–66, 2012; J Econ 182:119–134, 2014) and the Time-Varying Parameter Vector Autoregressive (TVP-VAR) connectedness approach by Gabauer and Antonakakis (Munich personal RePEc archive refined measures of dynamic connectedness based on TVP-VAR refined measures of dynamic connectedness based on TVP-VAR*, 2017). We scrutinized the interconnections and transmission mechanisms among key macro-financial variables spanning from 2000 to 2022. Our findings indicate that GPR is a fundamental source of shocks to the foreign exchange reserve (FXI), real exchange rate (REER), consumer price index (CPI), and debt. Other significant contributors include export (EXP) and import (IMP), with EXP standing out as the main shock transmitter. On the receiving end, CPI is most impacted by transmissions from IMP and GPR. Our study demonstrates that EXP and IMP are the top shock contributors, while FXI and CPI are the major recipients of these shocks. Such findings provide policymakers with valuable insights into the ramifications of geopolitical risk on the macroeconomic environment. Hence, policymakers are expected to provide necessary buffers to curb the influence of geopolitical risks on the economy.

The Enabling Effect of Digital Economy on High-Quality Agricultural Development-Evidence from China

In recent years, the digital economy has shown great potential in regard to in driving social production and development. In the context of the construction of digital villages, the deep integration of the digital economy and agricultural development has injected new vitality into improving the quality and efficiency of agricultural production, becoming an important way to promote sustainable agricultural development. Based on the panel data of 31 provinces in China from 2012 to 2021, the study utilizes the entropy method to measure the level of the digital economy and the high-quality development of agriculture. Additionally, this study explores the impact and mechanism of the digital economy on the high-quality development of agriculture by the fixed effect, mediation effect, and the spatial spillover models. In summary, the digital economy can significantly drive the high-quality development of agriculture, which is still valid after considering endogeneity and robustness. Mechanistically, the rationalization of industrial structure is an important path for the digital economy in regard to driving the high-quality development of agriculture. Regionally, the dividends of the digital economy for high-quality agricultural development in the central and western regions are greater than those in the eastern region. Spatially, the digital economy has a spatial spillover effect on the high-quality development of agriculture. Moreover, it can promote the synergistic development of adjoining regions. Therefore, policy recommendations are made in terms of strengthening rural infrastructure, emphasizing the development of regional shortcomings, and strengthening internal with external regional linkages.

Risk spillovers of carbon emissions in international trade: the role of disembodied technology communications

Carbon emission reduction is an important means of achieving climate policy goals. However, the literature has neglected consideration of the carbon emission reduction mechanism from the perspective of technology risk spillovers in international trade. To explore this mechanism, this paper expands the classical linear model of foreign trade technology risk spillovers into a nonlinear spatial Durbin model. We construct a novel technology risk spillover index to forecast the magnitude of carbon emissions in agricultural trade across different regions. To validate our model, we consider the dual connotation of the spatial diffusion of disembodied technology communication (DTC) to map the relationships between different geographic and economic regions that are adjacent. The results suggest that disembodied technology risk spillover could promote carbon emission reductions. Specifically, technology risk spillovers from agricultural trade reduce agricultural carbon emissions by 0.79–1.16% in the local region. Disembodied technology risk spillovers also reduce agricultural carbon emissions by 2.85–11.57% in geographically adjacent regions and 4.9% in economically adjacent regions. Based on these conclusions, this paper proposes improving the closed and backward situation of rural areas in China’s central and western regions, promoting the transition toward the high end of the global agricultural industry chain and developing productive agricultural services and the rural cultural tourism industry to expand rural employment channels and stabilize farmers’ income.

Geopolitical risk and the predictability of spillovers between exchange, commodity and stock markets

We utilize the cross-quantilogram method to assess the predictive capacity of geopolitical risk (GPR) on volatility spillovers calculated by the time-varying parameter vector autoregressive model, across international commodity, exchange, and U.S. and Chinese stock markets. The findings yield three notable observations: First, we establish the directional predictive influence of GPR on net and net pairwise volatility spillovers, indicating discernible shifts in the risk roles of specific markets and transmission pathways. Second, these shifts, anticipated by GPR, manifest swiftly within a single day and subside within a quarter, albeit with varying durations contingent on market categories and transmission pathways. Third, disparities are evident in the predictive effectiveness of geopolitical acts and geopolitical threats. These findings remain robust even when considering factors such as economic policy uncertainty, alternative proxies, and other spillover models.

Spatial constraints or spatial dynamics? The spatial spillover effect of networks of flood regulation service flows on land-use degree.

In the face of frequent floods under climate and environmental changes, it is particularly important to measure the supply and demand of flood regulation services. Using the Hainan Island as an illustrative case, this study constructs a spatial spillover model to examine the spatial correlation mode and evolution of regional land-use degree through the network of ecosystem service flow. The research results show that forests, grasslands, and reservoirs function as the primary suppliers of flood regulation services, with forests contributing significantly to the regulation of floods. High flood risk was identified in the eastern, northern, and western regions of the Hainan Island, corresponding to increased demand for flood regulation services in croplands, towns, and rural settlements within these areas. The flow of flood regulation services within the Hainan Island was found to be directed from the center to the surrounding areas, with medium and high service flows predominantly concentrated in the northern and surrounding regions. The degree of land use on the Hainan Island demonstrated an influence on socio-economic development. Additionally, the flow network of ecological services was identified as a crucial factor in spatial spillovers, reflecting the level of interaction between county units.

Spillover effect of foreign direct investment on wage-inequality in Indian manufacturing industries

PurposeThe purpose of this paper is to study the spillover effects of foreign direct investment (FDI) on skilled–unskilled wage inequality in the Indian manufacturing industries.Design/methodology/approachThe authors show theoretically with a model of spillover that if foreign firms (receiving FDI) have a negative spillover effect on domestic firms (not receiving FDI), then the level of capital and skilled workers in the domestic firms falls down. Consequently, the authors conduct an empirical analysis by using system GMM estimation technique on the firm-level data of the Indian organised manufacturing sector.FindingsThe authors show that wage inequality worsens when there is negative spillover effects like competition spillover or skill spillover effect of FDI in India.Originality/valueTo the best of the authors’ knowledge, this is the first attempt to measure the various spillover effects of FDI on the wage inequality in the Indian manufacturing industries by using firm-level data.

Incorporating environmental heterogeneity and observation effort to predict host distribution and viral spillover from a bat reservoir.

Predicting the spatial occurrence of wildlife is a major challenge for ecology and management. In Latin America, limited knowledge of the number and locations of vampire bat roosts precludes informed allocation of measures intended to prevent rabies spillover to humans and livestock. We inferred the spatial distribution of vampire bat roosts while accounting for observation effort and environmental effects by fitting a log Gaussian Cox process model to the locations of 563 roosts in three regions of Peru. Our model explained 45% of the variance in the observed roost distribution and identified environmental drivers of roost establishment. When correcting for uneven observation effort, our model estimated a total of 2340 roosts, indicating that undetected roosts (76%) exceed known roosts (24%) by threefold. Predicted hotspots of undetected roosts in rabies-free areas revealed high-risk areas for future viral incursions. Using the predicted roost distribution to inform a spatial model of rabies spillover to livestock identified areas with disproportionate underreporting and indicated a higher rabies burden than previously recognized. We provide a transferrable approach to infer the distribution of a mostly unobserved bat reservoir that can inform strategies to prevent the re-emergence of an important zoonosis.

Parental Distress and Parenting Behavior in Families of Preschool Children with and Without ASD: Spillover and Buffering.

Parents of children with autism spectrum disorder (ASD) report increased distress relative to parents of children with neurotypical development. Parent well-being is generally considered a key determinant of parenting behavior, thus increased distress may spill over into less optimal parenting in families of children with ASD. However, evidence is mixed regarding the degree to which parenting is actually compromised in this population, suggesting the possibility of buffering, wherein the parenting of children with ASD may be robust against spillover from increased parental distress. The current study tested competing spillover and buffering models with regard to relations among child ASD status, parental distress, and parenting behavior. Parents of preschoolers with (n = 73) and without (n = 55) ASD completed self-report measures of parenting stress, depressive symptoms, and emotion dysregulation, as well as of positive and negative parenting behaviors.Families of preschoolers with ASD reported higher distress and negative parenting, and lower positive parenting than did their counterparts. Findings supported the spillover model for negative parenting such that increased parental distress accounted for status-group differences in negative parenting. In contrast, potential buffering was observed for positive parenting in that an inverse association between distress and parenting was observed for parents of children with neurotypical development only.Findings highlight the potential benefit of intervention to reduce parental distress in families of children with ASD, but also suggest some existing ability of these families to buffer certain parenting behaviors from deleterious effects of parent distress.

On the prediction of systemic risk tolerance of cryptocurrencies

The role of big data in finance is pivotal, especially in forecasting stock prices, mitigating risk, and assessing market anomalies. With the financial system becoming more interconnected, analytical models using large data are gaining prominence in developing risk spillover models. This study estimates the systemic risk tolerance of twenty-five high-valued cryptocurrencies and finds that Fantom has the highest tolerance, while Bitcoin and Ethereum have a lower tolerance due to their large market share. It also shows that the common trend of cryptocurrencies enhances each other's tolerance and develops a predictive model for systemic risk tolerance. The study can help investors and market participants devise strategies for safe haven investment, hedging, and speculation during a market downturn.

Relationship between economic policy uncertainty and domestic credits: evidence from the long-span time series for the UK and the USA

ABSTRACT This paper examines the effects of news-based economic policy uncertainty (EPU) on domestic credit in the United Kingdom and the United States from 1900 to 2020. The Structural Vector Autoregression (SVAR) model results show that the EPU significantly decreases domestic credit both in the United Kingdom and the United States. Further results from the Volatility Spillover model indicate robust evidence of the negative impact of the EPU on domestic credit demand. The high spillover effect comes from the high EPU, which is associated with low domestic credit, and the low EPU is associated with increased domestic credit. The results are robust in different model procedures. The results indicate that consumers decrease durable consumption, and firms follow a wait-and-see strategy during times of higher EPU.

Analyzing Spillover Effects Among BRICS Stock Markets: Application of Copula and DCC-MGARCH Model

This study examines the nonlinear dependence and tail dependence of BRICS countries’ stock markets and the contagion effect among Brazil, Russia, India, China, and South Africa (BRICS) countries’ daily stock markets using the COPULA model from January 2000 to February 2019. The study employs the DCC-MGARCH model and Diebold and Yilmaz volatility spillover model to assess the interdependence dynamics across BRICS countries’ stock markets. The copula results suggest that the BRICS country’s stock markets are independent of each other. The conditional correlation between BRICS is negative and statistically significant, suggesting that the negative relationship among BRICS is an important signal for international investors to diversify among these countries and get the economic value of their investment. Further, Brazil, China, and South Africa are the net volatility transmitter, at the same time India and Russia are the net volatility receiver during the study period. The study proposes that policymaker of BRICS needs to interchange views and mutually map policies to appeal to global investment more.

Network infrastructure construction and heterogeneous enterprise innovation quasi-natural experiment based on “Broadband China”

Based on the technology choice model proposed by Bustos (2011) and the infrastructure spillover model developed by Dugga (1999), this paper aims to explore the multifaceted effects of network infrastructure construction on both radical and incremental enterprise innovation, while considering the micro perspective of enterprise and industry heterogeneity. The findings of this study uncover the following significant insights: (1) The implementation of network infrastructure construction exerts a substantial positive impact on both radical and incremental innovation within enterprises, affirming its crucial role in fostering innovation capabilities; (2) In the context of firm heterogeneity, the impact of network infrastructure construction on fostering radical and incremental innovation is particularly pronounced among medium-sized and large-scale enterprises, as well as state-owned enterprises; (3) Network infrastructure construction stimulates radical innovation primarily among local enterprises, whereas export-oriented enterprises tend to benefit more from incremental innovation; (4) When considering industry heterogeneity, the analysis demonstrates that network infrastructure construction fosters radical innovation in industries characterized by high concentration, intense competition, and advanced technology. On the other hand, in industries with low concentration and limited competition, network infrastructure construction tends to facilitate incremental innovation within enterprises. (5) Moreover, the study finds that the impact of network infrastructure construction on enterprise innovation is mediated by talent structure and financing constraints. These factors serve as crucial conduits through which network infrastructure construction facilitates both radical and incremental innovation. Furthermore, the paper acknowledges that the digital transformation of enterprises partially regulates these channels. Overall, this research offers valuable insights for enterprises in developing countries aiming to strengthen various forms of innovation in the digital era.

Strengths-based spillover models: Constructive interparental conflict, parental supportive problem solving, and development of child executive functioning.

Empirical research examining the Spillover Hypothesis has largely substantiated that interparental conflict comprised of hostility and anger has negative implications for parenting behaviors and cascading effects on children's development. However, less is known about how constructive forms of interparental conflict may operate in spillover processes. Toward this, the present study examined how interparental supportive and problem-solving approaches to conflict were associated with parental guided learning in the caregiving context and by extension young children's executive functioning. Participants included 231 families (mothers, fathers, and their child). Assessments of constructive interparental conflict were derived from both observational tasks and multi-informant report. Parental supportive problem solving was assessed observationally during a goal-directed parent-child interaction. Children's inhibitory control, working memory, and visual-spatial reasoning were assessed using validated tasks. Analyses were conducted in a structural equation modeling framework, and significance of indirect paths were tested using RMediation. Results showed constructive interparental conflict was associated with increases in maternal supportive problem solving, which in turn predicted increases in children's working memory. Furthermore, constructive interparental conflict was indirectly associated with increases in children's inhibitory control via paternal supportive problem solving. These findings were significant over two waves of data collection after controlling for child sex, maternal and paternal age, and maternal and paternal education. Findings underscore the potential utility of family resilience theory and domain approaches to parenting for increasing specificity and precision in identifying spillover processes. (PsycInfo Database Record (c) 2023 APA, all rights reserved).

Spillovers across the Asian OPEC+ Financial Market

This research utilizes the Diebold and Yilmaz spillover model to examine the correlation between geopolitical events, natural disasters, and oil stock returns in Asian OPEC+ member countries. The study extends prior research by investigating the dynamics of the Asian OPEC+ oil market in light of recent exogenous events. The analysis commences by creating a self-generated Asian OPEC+ index, which demonstrates significant volatility, as indicated by GARCH (1, 1) model estimation. The results obtained from the Diebold and Yilmaz spillover test indicate that, on average, there is a moderate degree of connectedness among the variables. However, in the event of global-level shocks or shocks specifically affecting Asian OPEC+ countries, a heightened level of connectedness is found. Prominent instances of spillover events observed in the volatility analysis conducted during the previous decade include the COVID-19 pandemic, the conflict between Russia and Ukraine, and the Turkey earthquake of 2023. Based on the facts, it is recommended that investors take into account the potential risks linked to regions that are susceptible to natural calamities and geopolitical occurrences while devising their portfolios for oil stocks. The results further highlight the significance of integrating these aspects into investors’ decision-making procedures and stress the need for risk management tactics that consider geopolitical risks and natural disasters in the oil equity market.

Reexamining the Impact of Global Value Chain Participation on Regional Economic Growth: New Evidence Based on a Nonlinear Model and Spatial Spillover Effects with Panel Data from Chinese Cities

This study utilizes panel data drawn from 239 Chinese cities, and it employs fixed-effects models, mediation models, and spatial spillover models to reexamine the actual impact of the global value chain’s (GVC) participation on regional economic growth. The findings reveal that this impact exhibits a U-shaped nonlinear pattern, with the turning point of GVC occurring at 0.45, which is higher than that of 222 cities. Most cities are on the left side of the U-shaped curve, which corresponds with the second stage of the “in-out-in-again” GVC participation pattern (i.e., the “out” stage). During this stage, a decline in foreign value-added ratio (FVAR), with regard to exports (accompanied by an increase in the domestic value-added ratio), promotes economic growth. Innovation capability acts as a mediator in the relationship between GVC participation and economic growth. Furthermore, GVC participation has significant spillover effects on neighboring cities, with siphon and spillover effects coexisting. Thus, China should focus on establishing domestic value chains and innovation systems, achieving relative independence from existing GVCs dominated by developed countries, enhancing indigenous innovation capabilities, and laying the foundation for the third stage (in-again) of reintegration into GVCs, at the high value-added end, to achieve a higher level of openness. This study explores the nonlinear impact of GVC participation on regional economic growth in China from both theoretical and empirical perspectives, focusing on the finest divisions that remain feasible—cities. This approach expands and supplements the relevant field of research in valuable ways, yielding more realistic research conclusions and policy recommendations.

How Do Global Uncertainties Spillovers Affect Leading Renewable Energy Indices? Evidence from the Network Connectedness Approach

By using data from 2018 to 2022 and employing quantile VAR time-frequency and quantile VAR spillover models, this study investigates the spillover connectedness between global uncertainties, namely, geopolitical risk, economic policy uncertainty, and climate policy uncertainty, and seven leading global renewable energy indices. The results show strong total connectedness (82.87%) between renewable energy and uncertainty indices. DJRE, R&CE, MSCIEE, WRE_cpu, GEPU_C, and GEPU_P are found to be net receivers, and WRE to be net transmitters of spillovers. Additionally, the MSCIEE sector is the least connected, i.e., 2.51%, followed by the R&CE sector at 4.55%, while the ERE sector is the most connected one, i.e., 65.8%. We discover that the two market-based uncertainties have less impact than economic policy uncertainty (EPU), which has a significant impact. The conclusions have ramifications for decision-makers and investors in the renewable energy markets from the standpoint of sustainable development. The study reveals diversification avenues and recommends that investors consider MSCIEE and R&CE sectors for parking their funds because of lower risk, i.e., less connectivity and greater diversification.