Period Of Economic Uncertainty Research Articles

Multifractal Behavior of Cryptocurrencies During Periods of Economic Uncertainty

Background: In recent years, investors' interest in cryptocurrencies has increased due to their notable price volatility and rapid price increases. These investors view cryptocurrencies as suitable financial assets for portfolio rebalancing strategies. Purpose: The main objective of this study is to examine the multifractality of the cryptocurrencies Bitcoin (BTC), Lisk (LSK), Quantum (QUA), Litecoin (LTC), Ripple (XRP), Augur (REP), Darkcoin (DASH), EOS, IOTA (MIOTA). Methods: The Detrended Fluctuation Analysis (DFA) econophysics model supports the methodology. Results: The results suggest that during the 2020 pandemic period, the digital currencies LSK, QUA, MIOTA, XRP, REP, BTC, ETH, LTC and DASH showed very significant persistence, indicating that price formation is not random. However, validating that cryptocurrency prices are predictable based on historical time series was impossible. On the other hand, the digital currency EOS proved to be in equilibrium; in other words, price formation follows the random walk pattern, suggesting that prices are not autocorrelated over time. During the 2022 geopolitical conflict, long-term memory patterns shifted significantly towards short-term memories, i.e. anti-persistence. The digital currencies ETH, MIOTA, EOS, LTC, REP, LSK and DASH showed anti-persistence slopes, indicating that prices were less influenced by past events and more by recent events. On the other hand, the cryptocurrencies BTC (0.50), QUA (0.50), and XRP (0.50) demonstrate that prices contain a significant random component and that the residuals are independent and identically distributed (i.i.d.), supporting the idea that white noise might be present. Conclusion: From a risk management perspective, these findings are highly relevant to investors, traders and market participants.

Benefits of consistent and comprehensive financial advice during the Great Recession

Financial advice can be valuable during periods of economic uncertainty but measuring this value can be difficult. Using a nationally representative dataset of U.S. households during the Great Recession, we compare the net worth of households that retained a comprehensive financial adviser, a specialized financial adviser, or no financial adviser. A difference-in-difference analysis reveals that maintaining a relationship with a comprehensive financial adviser is associated with higher household net worth, relative to households with inconsistent relationships with advisers, or relationships in which only specified services are sought. Overall, our findings suggest that consumers benefit most when they make the financial decision to consistently work with a financial adviser from whom they seek comprehensive services.

State-level economic uncertainty and cardiovascular disease deaths: evidence from the United States

The relationship between economic recessions and cardiovascular mortality has been widely explored. However, there is limited evidence on whether economic uncertainty alone is linked to cardiovascular disease deaths. This study examines the association between economic uncertainty and mortality from diseases of the circulatory system in the United States. We obtained monthly state-level mortality data from 2008 to 2017 and used indices capturing economic uncertainty from national/international sources and local sources. Panel data modelling was used to account for unobserved time-invariant differences between the states. Our findings suggest that economic uncertainty is independently linked to cardiovascular mortality. Uncertainty arising from national/international sources is associated with cardiovascular deaths, whereas the respective index capturing uncertainty from state/local sources is not. Deaths respond asymmetrically with respect to uncertainty fluctuations – with high levels of uncertainty driving the association. One- and two-month lagged uncertainty levels are also associated with mortality. Several robustness checks further validate the baseline findings. Overall, economic uncertainty is an independent predictor of cardiovascular mortality which appears to act as a psychosocial stressor and a short-term trigger. Public health strategies for cardiovascular disease need to consider factors driving economic uncertainty. Preventive measures and raising awareness can intensify in periods of economic uncertainty.

Інформаційне забезпечення планування діяльності державних підприємств в умовах економічної невизначеності

Introduction. The period of economic uncertainty has led to the globalization of fiscal risks, which is marked by a significant decline in budget revenues and the intensity of economic processes in general. The deterioration in the performance of state-owned enterprises played an important role in this. Problem Statement. The need to mitigate fiscal risks arises at the planning stage of business entities' activities, which requires reliable and relevant information support. Purpose. Assessment of the impact of state-owned enterprises on the planned indicators of the state budget and study of the information basis for the formation of a financial plan as a source of data for managing fiscal risks in the context of the COVID-19 pandemic. Methods. General scientific and special methods of cognition are used: analysis, synthesis, grouping, averages and relative values, coefficient analysis, comparison, modeling, generalization. Results. The most vulnerable type of state budget revenues to the effects of the COVID-19 pandemic was the receipt of part of the net profit of state-owned enterprises and dividends on the state share. It is determined that one of the key information bases for managing fiscal risks is the financial plan of state-owned enterprises. It is substantiated that retrospective and prospective information for the formation of the financial plan is produced in the accounting system, which ensures the identification and systematization of data on the types of taxes and the amount of payments incurred. The information is grouped by functional basis, which makes it possible to structure the sources of planning at the national and micro levels and will help to improve the quality of information support for fiscal risk management to offset the negative impact of the COVID-19 pandemic on the performance of budget revenues. Conclusions. The COVID-19 pandemic has had a significant negative impact on the planning process of state-owned enterprises and the stability of the state budget revenues. The key source of information for fiscal risk management at all stages of the budget process is reliable and valid accounting and reporting data and indicators.

The impact of COVID-19 on the relationship between auditor industry specialization and audit fees: empirical evidence from Jordan

Purpose Motivated by the disastrous impact of COVID-19 on the world’s economies, the purpose of this study is to examine its effect on the association between auditor industry specialization and external audit fees, referring to two time periods: before and during COVID-19. Design/methodology/approach A quantitative analysis based on the ordinary least squares regression is performed, using 3,200 company-year observations from 2005 to 2020 in Jordan to test the hypotheses. The qualitative component is a textual analysis of firms’ annual reports that support the quantitative analysis findings. Findings The analysis confirms there is a direct positive relationship between COVID-19 and external audit fees, confirming the tough consequences of the crisis on audit complexity and risks. While the results show evidence that the relationship between auditor specialist and audit fees is weakened because of COVID-19, the content analysis explained that COVID-19 led to fewer requests for high-quality audit, given the urgent need to report on firms’ financial circumstances. Jordan’s capital market is controlled by family businesses, and the insolvency of several large firms during COVID-19 led auditors to offer their services at low cost. Research limitations/implications The findings of this study have serious implications for policymakers, legislators, regulators and the audit profession, as they examine the arising difficulties during a period of economic uncertainty. The findings can help to improve laws that control the auditing industry in Jordan following the damage caused by COVID-19. As well, the outcomes can be extrapolated to other Middle East nations. Originality/value To the best of the authors’ knowledge, the authors believe that this research presents the first evidence on the influence of COVID-19 on the auditing industry.

Market Penetration through Digital Marketing: A Case Study of a Tractor Dealership During Covid-19 Pandemic

The present study investigates the efficacy of digital marketing strategies in enhancing customer reach and sales for a tractor dealership, “Shyam Tractors of Sonalika International Tractors Limited,” located in Seoni, Madhya Pradesh, during the COVID-19 pandemic. The dealership adopted digital marketing to stimulate additional inquiries, leading to increased customer reach and sales. Of the total inquiries received over four months, 32% were sourced from digital marketing initiatives. These strategies encompassed the use of automation tools for continuous customer interaction, resulting in amplified brand visibility and customer trust, and fostering positive word-of-mouth. The findings suggest that the success of digital marketing strategies is contingent upon location, demographics, and target audience, emphasizing the necessity of customizing strategies to local market conditions. While digital marketing showed promising results, the continued relevance of traditional marketing underscores the need for a balanced marketing approach for optimal customer engagement. In summary, this study concludes that digital marketing strategies can effectively augment customer reach, sales, and engagement in the tractor industry, particularly during periods of economic uncertainty and market disruption. This implies that tractor dealerships could benefit significantly from integrating digital marketing strategies into their business models.

The nexus between economic policy uncertainty and access to finance: a study of developing countries

PurposeThis paper attempts to document the effect of economic uncertainty on financing constraints faced by private firms.Design/methodology/approachOrdered logistic regression is used to analyze the data of private firms from 101 developing countries. The data was provided by the World Bank's Enterprise Surveys and was gathered during the period between 2006 and 2019.FindingsThe findings show that firms headquartered in countries with high economic uncertainty face more financing constraints than firms headquartered in countries with low economic uncertainty. The authors argue that the increase in economic uncertainty allows capital providers to adjust their lending decisions by reducing the provision of capital to firms. The paper also shows that firms headquartered in countries with strong institutional infrastructure and well-functioning firms are less likely to be affected by economic uncertainty while accessing finance.Practical implicationsThe findings would help managers, investors, regulators, and policymakers better understand the implication of economic policy uncertainty on the real economy. This study also sheds the light on the importance of minimizing volatility, ambiguity, and randomness in governmental decisions and policies. Regardless of the pertinence of these policies, arbitrariness surrounding their development and communication can limit their effectiveness and produce unwanted effects.Originality/valueThis paper is closely related to prior literature that documents the behavior of credit providers and investors (the supply side) during the periods of economic uncertainty. The authors differ from this strand of literature by taking the perspective of firms – the demand side.

Road traffic mortality and economic uncertainty: Evidence from the United States

Previous studies have shown that financial turbulence is associated with a short-term increase in road traffic collisions, largely due to drivers’ emotional state, distraction, sleep deprivation and alcohol consumption. In this paper we advance this debate by studying the association between economic uncertainty and road traffic mortality in the United States. We used a State-level uncertainty index and State fatalities for the period 2008–2017 and found that a one standard deviation increase in economic uncertainty is associated with an additional 0.013 monthly deaths per 100,000 people per State, on average (a 1.1% increase) - or 40 more monthly deaths in total nationwide. Results are robust to different model specifications. Our findings show that, similar to drink-driving, it is important to raise awareness about driving when distracted due to financial worries and during periods of economic uncertainty.

Law, South African Mothers Living in Poverty and the COVID-19 Pandemic

Sometimes being a mother in tough economic times can be a challenge. Socio-economic demands occasioned by the COVID-19 pandemic have been especially cumbersome for mothers already living under conditions of poverty. Since the beginning of 2020 the pandemic has further exacerbated the daily struggles of the poor during periods of economic uncertainty, disease and death. Conscious of this additional socio-economic pressure and to lessen the financial burden carried by mothers living in poverty, the South African state introduced a COVID-19 relief Child Support Grant to assist during this trying period. This article explores the role played by law in poverty discourse where mothers are concerned. It is suggested here that the conceptualisation of poverty in law, at least where mothers are concerned, is limited by law's neglect of the socio-political identity of women as mothers, which is rooted in history. This failure reaffirms that law is implicated in contemporary socio-economic inequalities

Capitalisation rates for commercial real estate investments: evidence from Australia

PurposeThe paper is motivated by the paucity of empirical research on the determinants of capitalisation rates/yield in the commercial property market. Compared to property price determinants, the capitalisation rate has received significantly less attention. This is somewhat surprising given that the capitalisation rate is a more insightful indicator for investors on commercial property market performance than merely price changes or trends. The capitalisation rate, measured as the ratio of net operating income to the property’s capital value, captures the asset’s overall ability to generate income which is crucial for investors who typically invest in property for their income-generating capacity. The purpose of this paper is to address these issues.Design/methodology/approachTo evaluate the determinants of capitalisation rates, time series analysis was used. The data capture performance in the Australian commercial property market between 2005 and 2018. All macroeconomic and financial data are freely available from official sources such as the Australian Bureau of Statistics and the nation’s central bank. Methodology wise, given the problematic nature of the data such as a mixed order of integration and the possibility of cointegration amongst some of the I (1) variables, the autoregressive distributed lag model was selected given its flexibility and relative lack of assumptions.FindingsBond rates, market risk premiums, stock market excess returns and other macroeconomic variables were found to drive capitalisation rates of Australian commercial properties. A 1% increase in the bond rate results in approximately 0.3–2.4% increase in capitalisation rates depending on the sub-market. Further, a 1% increase in excess market returns results in a 0.01–0.02% increase in capitalisation rates. Regarding risk premiums, a 100 basis point increase in the BBB spread results in approximately 0.92–1.27% reduction in cap rates in certain markets.Practical implicationsAsset managers will find these results useful in asset allocation strategies. Commercial properties offer attractive investment qualities such as yield stability in periods of economic uncertainty while allowing for the possibility of capital growth through appreciation of the underlying asset. By understanding the factors that affect the capitalisation rate, practitioners may predict emerging trends and identify threats to portfolio return and stability. This allows better integration of commercial property in the construction of portfolios that remain robust in a variety of market conditions.Originality/valueThe contribution to literature is significant given the lack of similar studies in the Australian market. The performance of real estate assets using cap rates as a comparative measure to equities and bonds influences decisions in asset allocation strategies. It provides crucial information for investors to estimate the performance of commercial property. This research supports the notion that both space and capital market indicators jointly affect capitalisation rates. The findings expand the knowledge base relating to commercial properties and validate the assessments of investors, developers and valuers who utilise yield as a performance benchmark for asset allocation strategies.

НЕСТАБІЛЬНІ ФІНАНСОВО-ЕКОНОМІЧНІ ЧИННИКИ У СВІТІ І ЇХ ВПЛИВ НА РОЗВИТОК БЛОКЧЕЙН ТЕХНОЛОГІЙ

The article explores the impact of unstable financial and economic factors on the development of blockchain technologies. In recent years, blockchain has emerged as a disruptive innovation with the potential to transform various sectors, including finance, supply chain management, and healthcare. This article sheds light on the interplay between the volatile financial and economic landscape and the evolution of blockchain technologies. The author emphasizes that unstable financial and economic conditions have significantly influenced the trajectory of blockchain development. The article argues that during periods of economic uncertainty, blockchain technology gains traction as a trusted and transparent alternative to traditional financial systems. Blockchain's decentralized nature, cryptographic security, and immutable recordkeeping capabilities make it an attractive solution for addressing issues such as fraud, corruption, and lack of transparency. Furthermore, the article delves into specific instances where blockchain adoption has been fueled by unstable financial and economic factors. For instance, in countries facing hyperinflation or economic crises, blockchain-based cryptocurrencies have provided individuals with a means to protect their wealth and conduct secure transactions. Similarly, in supply chain management, blockchain's ability to enhance transparency and traceability has gained momentum in the wake of widespread disruptions caused by global events such as the COVID-19 pandemic. The article also explores the potential challenges and limitations that arise from the relationship between unstable financial and economic factors and blockchain technologies. It acknowledges that while blockchain holds promise, regulatory uncertainties, scalability issues, and interoperability concerns can hinder its widespread adoption. In conclusion, this article highlights the intricate relationship between unstable financial and economic factors and the development of blockchain technologies. It provides valuable insights into the growing relevance of blockchain in addressing the shortcomings of traditional financial systems during times of economic instability. However, it also underscores the need for continued research, collaboration, and regulatory clarity to harness the full potential of blockchain technology in a rapidly evolving financial landscape. Overall, this article serves as a thoughtprovoking resource for researchers, policymakers, and industry professionals seeking to understand the dynamic interplay between unstable financial and economic factors and the development of blockchain technologies.

Pricing uncertainty in the Brazilian stock market: do size and sustainability matter?

This article analyzes the pricing of innovations in the Brazilian stock market during periods of economic uncertainty. Cross-sectional data were analyzed using the generalized method of moments technique, and our findings indicate that during such periods, innovations negatively impact excess stock returns. Furthermore, our findings suggest that innovations during economic uncertainty improve the pricing of financial assets, making them a significant risk factor. These results are corroborated by those for the Corporate Sustainability Index and the Small Caps Index in the robustness analysis.

Strategic issues of raising international financing

The article discusses some strategic issues related to the raising of international financing by the means of syndicated loans and eurobonds by Russian corporations. Author proposes a method for benchmarking the financial position of the company compared to its competitors. This analysis uses key performance indicators, including the debtfinancing share, credit rating, weighted average cost of capital. Crises have become a frequent occurrence in global economy. For the top-managers of the corporation, one of the key tasks during the period of economic uncertainty is the handling of communications with lenders and investors for the control of the company’s financial position. The article considers the specifics of providing the required information about company activity during the crisis. The key document is the financial model, based on the macroeconomic, industrial, and operational assumptions regarding the borrower’s operations. Using financial covenants as an example, we consider the mechanics of incorporating changes into the current loan terms, as well as the raising of new funding by using shirt-term revolving credit facilities. For the solution of one of the key strategic goals of corporate finance – execution of mergers and acquisitions transactions – we present an algorithm of raising financing by using syndicated loans and eurobonds.

'I can't go, I can't afford it': Financial concern amongst health students undertaking rural and remote placements during COVID-19.

IntroductionAs the coronavirus pandemic unfolded during 2020, widespread financial uncertainty emerged amongst university students across the globe. What is not yet clear is how Australian health students were financially impacted during the initial stages of the pandemic and whether this influenced their ability to undertake planned rural or remote placements.ObjectiveTo examine (a) financial concern amongst health students during COVID‐19, (b) the financial implications of changes to planned rural or remote placements and (c) the impact of these factors on students' ability to undertake placements during the pandemic.DesignMixed‐methods design involving an online survey (n = 1210) and semi‐structured interviews (n = 29). Nursing, medical and allied health students with a planned University Department of Rural Health‐facilitated rural or remote placement between February and October 2020 were invited to participate.Findings54.6% of surveyed students reported financial concern during COVID‐19. Financial concern correlated with both changes in financial position and employment, with 36.6% of students reporting a reduction in income and 43.1% of students reporting a reduction in, or cessation of regular employment. Placement changes yielded a range of financial implications. Cancelled placements saved some students travel and accommodation costs, but left others out of pocket if these expenses were prepaid. Placements that went ahead often incurred increased accommodation costs due to limited availability. Financial concern and/or financial implications of placement changes ultimately prevented some students from undertaking their rural or remote placement as planned.DiscussionMany nursing, allied health and medical students expressed financial concern during COVID‐19, associated with a loss of regular employment and income. Placement changes also presented unforeseen financial burden for students. These factors ultimately prevented some students from undertaking their planned rural or remote placement.ConclusionUniversities need to consider how best to align financially burdensome placements with the personal circumstances of students during periods of economic uncertainty.

Food insecurity among active duty soldiers and their families during the coronavirus disease 2019 pandemic.

We examined the determinants of food insecurity among active duty Army households that transitioned into food insecurity during the coronavirus disease 2019 (COVID-19) pandemic. We compared Army households that recently transitioned into marginal food insecurity with those households that remained highly food secure (n 2832) to better understand how these households differ in their resilience to food insecurity during economic downturns using data from a military installation in the USA in 2020. A US military installation in the USA. Active duty US Army soldiers. Prior to the pandemic, the prevalence of marginal food insecurity among Army households was similar to that reported for households in the general population. Marginal food insecurity among Army households increased over 1·5-fold - from 19 % to 33 % - with the onset of the pandemic. Relative to Army households with consistently high food security, the Army households that transitioned into marginal food insecurity after the onset of the pandemic were more likely to report concerns about financial insecurity and the job security of their family members. Army households, like their civilian counterparts, are vulnerable to food insecurity because of instability in their income during periods of economic uncertainty. Periods of economic uncertainty are more common for Army households because of the frequent relocations associated with military service which could lead to predictable periodic spikes in their food insecurity.

Indicators of firm growth: Evidence from the JSE

The estimation of firm growth is increasingly relevant to providers of capital in periods of economic uncertainty. The current study employs univariate and multivariate analyses to assess the impact of real GDP and the dividend payout ratio on earnings growth of JSE-listed firms. The findings reveal that there is no relationship between these hypothesised predictors of earnings growth, despite contrasting results of previous studies. Through the inclusion of real GDP in models that are established in the research, the study contributes to the literature of macroeconomic variables as lead indicators of firms’ earnings growth potential. This research also extends prior research on the impact of dividend payout ratio on future earnings growth.

An Analysis of the Impact of a Pandemic on the Performance of Pharmaceutical Stocks

Abstract This research paper investigates the impact of the 2009 H1N1 and Covid-19 pandemics on the returns, volatility, systematic risk and total risk composition of 80 pharmaceutical stocks listed on 11 market indices. Using Bayesian inference and Monte Carlo simulation, the analysis creates an expectation of the potential impact that the Covid-19 pandemic will have on the performance of pharmaceutical stocks. The analysis show a likely increase in stock prices of up to 25% of their values at the start of the pandemic. The results also show that the negative impacts of the pandemic will be realised as increased volatility rather than a decrease in returns. The research makes a methodological contribution to the research on market reaction during pandemics. It also extends the literature on market behaviour during periods of economic uncertainty.

The impacts of household social benefits, public expenditure on labour markets, and household financial assets on the renewable energy sector

This research analyses the impacts of social benefits to households, public spending on labour markets, and household financial assets on the supply of renewable energy for selected OECD coussntries from 1995 to 2017. It uses a Panel Non-linear ARDL (PNARDL) model to investigate the long- and short-run symmetric relationships between the variables. The results indicate that changes in labour market public spending have significant asymmetric impacts on renewable energy over both time horizons. The findings confirm the importance of current active labour market policies on the energy market. However, the effects of household financial assets on the energy market are not pronounced. Likewise, the results show that positive changes in household social benefits have a negative impact on renewable energy in the short run. Addressing barriers and increasing investment opportunities for households in the renewable energy market can provide effective solutions for overcoming downturns during periods of economic uncertainty, pandemics, and recessions.

Economic uncertainty and suicide in the United States

Previous studies have found an association between recessions and increased rates of suicide. In the present study we widened the focus to examine the association between economic uncertainty and suicides. We used monthly suicide data from the US at the State level from 2000 to 2017 and combined them with the monthly economic uncertainty index. We followed a panel data econometric approach to study the association between economic uncertainty and suicide, controlling for unemployment and other indicators. Economic uncertainty is positively associated with suicide when controlling for unemployment [coeff: 8.026; 95% CI: 3.692–12.360] or for a wider range of economic and demographic characteristics [coeff: 7.478; 95% CI: 3.333–11.623]. An increase in the uncertainty index by one percent is associated with an additional 11–24.4 additional monthly suicides in the US. Economic uncertainty is likely to act as a trigger, which underlines the impulsive nature of some suicides. This highlights the importance of providing access to suicide prevention interventions (e.g. hotlines) during periods of economic uncertainty.

Implications of COVID-19 labour market shocks for inequality in financial wellbeing.

Australia’s economy abruptly entered into a recession due to the COVID-19 pandemic of 2020. Related labour market shocks on Australian residents have been substantial due to business closures and social distancing restrictions. Government measures are in place to reduce flow-on effects to people’s financial situations, but the extent to which Australian residents suffering these shocks experience lower levels of financial wellbeing, including associated implications for inequality, is unknown. Using novel data we collected from 2078 Australian residents during April to July 2020, we show that experiencing a labour market shock during the pandemic is associated with a 29% lower level of perceived financial wellbeing, on average. Unconditional quantile regressions indicate that lower levels of financial wellbeing are present across the entire distribution, except at the very top. Distribution analyses indicate that the labour market shocks are also associated with higher levels of inequality in financial wellbeing. Financial counselling and support targeted at people who experience labour market shocks could help them to manage financial commitments and regain financial control during periods of economic uncertainty.