Trade Security Research Articles

Aspetti normativi e legislazione fitosanitaria a sostegno della difesa eco-sostenibile delle colture

La normativa europea e nazionale in materia fitosanitaria si è inizialmente interessata alla tutela della salute dei consumatori, regolamentando soprattutto la produzione e la commercializzazione dei prodotti fitosanitari e considerando i loro residui negli alimenti. Successivamente, la legislazione europea ha considerato anche l'impatto delle sostanze chimiche contenute nei formulati commerciali nei confronti dell'operatore e dell’ambiente. Inoltre, con l'approvazione della Direttiva 128 del 2009, che "istituisce un quadro per l'azione comunitaria ai fini dell'utilizzo sostenibile dei pesticidi", per la prima volta ne viene regolamentato l'impiego, stabilendo principi comuni per un loro utilizzo razionale e sicuro. Con questa importante direttiva, si definiscono dei Piani di Azione Nazionale (PAN) per promuovere l'utilizzo di prodotti fitosanitari maggiormente sostenibili e fornire indicazioni per ridurre il loro impatto in ambito agricolo, extra agricolo e in aree naturali protette. In tale contesto, vengono illustrati e discussi i criteri di applicazione e il quadro normativo di riferimento più aggiornato.

The Effects of a Cold Disinfestation on Bactrocera dorsalis Survival and Navel Orange Quality.

Citrus sinensis (L.) Osbeck is an important economic product in South China, but the presence of quarantine pests in this product proposes the potential threat to international trade security. To find a proper phytosanitary cold treatment for Bactrocera dorsalis (Hendel) (Diptera: Tephritidae), commonly called oriental fruit fly, one of the most serious quarantine insects in navel orange, eggs in petri dish and larvae in navel orange fruits were exposed to a 1.7 °C cold chamber for 0–11 days to compare the tolerance to cold treatment. The 2nd instar larva (4 days) is the most tolerant stage, and the estimated time for 99.9968% mortality at the 95% confidence level is 11.3 (9.5, 14.6) days. Then 15 days was selected as the target time for the confirmatory tests, resulting in no survivors from 37,792 treated larvae with the efficacy of 99.9921% mortality at the 95% confidence level. The quality assessments were conducted to compare the effect on the navel orange fruit between cold treatment and the conventional cold storage. Results indicated that the cold treatment did not negatively affect the fruit quality. Therefore, this cold treatment showed potential as a commercial quarantine treatment for navel orange in international trade.

An Intrinsic Entropy Model for Exchange-Traded Securities

This paper introduces an intrinsic entropy model which can be employed as an indicator for gauging investors’ interest in a given exchange-traded security, along with the state of the overall market corroborated by individual security trading data. Although the syntagma of intrinsic entropy might sound somehow pleonastic, since entropy itself characterizes the fundamentals of a system, we would like to make a clear distinction between entropy models based on the values that a random variable may take, and the model that we propose, which employs actual stock exchange trading data. The model that we propose for the intrinsic entropy does not include any exogenous factor that could influence the level of entropy. The intrinsic entropy signals if the market is either inclined to buy the security or rather to sell it. We further explore the usage of the intrinsic entropy model for algorithmic trading, in order to demonstrate the value of our model in assisting investors’ intraday stock portfolio selection, along with timely generated signals for supporting the buy/sell decision-making process. The test results provide empirical evidence that the proposed intrinsic entropy model can be used as an indicator for evaluating the direction and the intensity of intraday trading activity of an exchange-traded security. The data employed for testing consisted of historical intraday transactions executed on The Bucharest Stock Exchange (BVB).

Blockchain Startups and Prospectus Regulation

Initial coin offerings are a new way for blockchain startups to finance project development by issuing coins or tokens in exchange for fiat money or Bitcoin or other cryptocurrencies. In this article, we start from the current distinction between different types of tokens and argue that it can create confusion and should be at least partially abandoned. We believe that the conceptual difference between a currency token and a tradable utility token is just the dimension of the crypto environment in which the token is spent. More specifically, ‘utility tokens’ combine the customer payment mechanism with the utility component and, when tradable on a secondary market, the investment one. We argue that they blur the traditional distinctions between currencies, financial assets and consumption goods. Moreover, we stress the increasing importance of online crypto exchanges. Recently some exchanges have also taken up the role of trusted intermediaries and staked their reputation on token offerings, which are termed initial exchange offerings and have gained in popularity. We therefore argue that the crypto market increasingly looks like a segment of the capital market and behaves as such. Given that tokens have a clear investment component, we show that they are tradable securities under the Prospectus Regulation. We compare the European securities regulation with its US counterpart and focus on prospectus exemptions, highlighting the great differences between Europe and the US which make Europe less amicable to blockchain startups.

Explaining the intention to use social trading platforms: an empirical investigation

The enormous rise of financial technology companies has greatly challenged traditional financial institutions. One emerging innovation is “social trading” (ST), which combines the advantages of social networks and delegated trading. ST platforms represent a unique context of social media platforms, on which the impact of social influence on the potential customer’s intention to use is not well understood. Moreover, researchers and practitioners lack an understanding of the moderating role of the consumer’s previous experience regarding security trading. As research in the field of ST is rather young, our study aims to be the first to address these research gaps by developing and empirically validating a model from the potential customer’s perspective. We based our framework on the Unified Theory of Acceptance and Use of Technology and theory regarding social media and financial decision-making. Our results illustrate that performance-related aspects are the dominant determinants of behavioral intention for experienced users, whereas system-related and personal barriers affect behavioral intentions of the inexperienced group. Consequently, differences regarding performance expectancy, effort expectancy, security and risk aversion were identified. Our results indicate that current platform operators’ advertising approaches of communicating the simple functionality of the platform seem inappropriate to meet the consumer’s needs.

Structural change and output volatility reduction in OECD countries: evidence of the Second Great Moderation

In this article, we provide new, novel evidence for a more recent structural break (in 2010) indicating a greater moderation of output volatility compared to the well-known break during the mid-1980s. The period of analysis runs from 1962Q2 to 2018Q3. It covers 26 OECD countries. In terms of methodology, it has mainly been used as the measures of conditional and unconditional volatility and procedures of structural break detection (Inclan–Tiao test and autoregressive conditional heteroscedasticity model). As a result, it has been found that output greatly stabilized following the structural break at 2010Q1 in the post-era of 2008/09 global financial crisis. Moreover, output stabilization is robustly evident for 24 (out of 26) OECD countries. From a political standpoint, it is implied that the Keynesian view may be influential in this moderation. Government expenditures and fiscal programs, regulations of financial markets against the sub-prime lending and limitations to trade of mortgage-backed securities might have been the main driver of stability. Rapid improvement of digitalization and technical productivity may be regarded as another relevant reason that might have contributed to the stabilization process.

The Role of Storage and Trade in Food Security

Abstract This paper examines the role of storage and trade on food security with respect to milled rice in India for the period 1966–2013. Data on food balances, prices, and population obtained from FAOSTAT allow for the observation of the status quo with storage and trade. Then, using a spatial equilibrium framework, the outcomes without storage or trade are simulated. Our results are consistent with the literature with respect to welfare effects. Storage results in net welfare gains to society, although producers gain while consumers lose. Producers receive a welfare gain from net exports while consumers gain from net imports. From a food security perspective, the use of storage has provided benefits to consumers by increasing stability in the market, as seen through decreased standard deviation in both domestic rice prices and per capita availability. The results are mixed with respect to stability from trade.

Retail investor experience, asset learning, and portfolio risk-adjusted returns

It is well documented in the finance literature that retail investors (households) underperform on a risk-adjusted basis when trading in securities markets. More recently, however, there is growing evidence that some retail investors increase risk-adjusted returns from security selection (portfolio concentration). I show that these mixed findings are driven by investor trading experience. Using unique portfolio holdings data of all the 620,970 domestic retail investors on the Oslo Stock Exchange (OSE) from 1993 to 2006, I document that inexperienced investors reduce returns from portfolio concentration. However, as investors gain trading experience their ability to turn portfolio concentration into excess returns improves.

Effectiveness of a strategic energy reserve during the energy transition: The case of Switzerland

Switzerland is considering implementing a strategic energy reserve, a novel policy instrument that remunerates power plant operators for storing a minimum amount of energy in reservoirs to convert into electricity when called upon. The policy is envisioned for the winter period, when the country’s large hydropower reservoirs tend to be nearly depleted. This study analyzes the impact of such a strategic energy reserve on security of supply, consumer costs, international trade, and sustainability. A hybrid simulation model is developed that combines agent-based modeling and system dynamics. The simulations show that the reserve can improve short-term security of supply but does not improve long-term security of supply as it does not impact domestic investments or reduce the import dependency in winter. The reserve leads to a slight increase in consumer costs, even when including the reduction in outage costs. A larger reserve is more effective at reducing the supply risk but is proportionally costly. Lastly, we find that the policy induces scarcity periods that would not have occurred otherwise, which means that the reserve should have a high strike price to ensure it is only called upon as a last resort. We conclude that there is no structural need for a strategic energy reserve, as it only increases short-term security of supply and does not contribute to solving the structural problem. Any implementation should be done on an ad hoc basis, conditional on a short-term generation adequacy assessment. This has the potential to minimize the associated costs while maximizing the benefits.

Quantum Selective Encryption for Medical Images

To trade security off for computational complexity, Selective Encryption (SE) in Image Processing denotes an approach which is capable of encrypting an image partially. In other words, it is aimed at turning the visually most important parts of images into meaningless ones, ignoring unimportant regions to have a computationally-efficient technique. Based on BRQI images, in this paper, a novel quantum selective encryption method for medical images is investigated. ROI (Region of Interest) tends to be the most vital part of medical images, which should be protected during the transmissions. The proposed method encrypts this region effectively by manipulating the bitplanes of the images according to a key. Experimental results encompassing correlation of adjacent pixels, histogram analysis and entropy rate analyzed in MATLAB environment demonstrate a good performance. Furthermore, regarding a BRQI image of 2n pixels, the time complexity is not more than O(m), where m is length of the key sequence. On no condition does it depend on size of images, bringing about being far more time-efficient compared to its classical counterpart and even earlier studied works found in the literature (full-encryption ones). To the best of our knowledge, this is the first method to introduce a quantum selective image encryption method.

Food Security and Trade in Food Products in Nigeria

Improving food security depends on identifying the indicators of food insecurity that must be monitored and addressed by the policy makers and implementers. This paper investigates the dynamics of trade in food products and food security in Nigeria. Using descriptive approaches, the findings show that Nigeria markedly recorded an adverse TBI in total agri-food trade and many food products. Remarkably, the five mostly exported (i.e. cocoa, fruits and nuts, oilseeds, tobacco) and five mostly imported (wheat, edible products, fish, sugar, milk and cream) food products accounted for 78% and 70% of total food exports and imports in the country. The study also reveals that Nigeria has been grossly food insecure driven by indicators, such as infrastructure deficit, population growth, poverty, corruption, inadequate government support to farmers and absence of safety net programmes. The Nigerian government and other stakeholders should holistically invest and implement agricultural policies to improve food security and earnings in many food products. Keywords: accessibility, affordability, availability, food insecurity, poverty, TBI

ОЦІНКА ВПЛИВУ ІНФОРМАЦІЙНО-КОМУНІКАЦІЙНИХ ТЕХНОЛОГІЙ НА ПОКАЗНИКИ ЗОВНІШНЬОТОРГОВЕЛЬНОЇ БЕЗПЕКИ ДЕРЖАВИ

Розглянуто проблему вивчення впливу інформаційно-комунікаційних технологій (ІКТ) на зміну показників експорту та імпорту товарів, що є основою для розрахунку та прогнозування змін показників зовнішньоторговельної безпеки держави. Установлено, що вплив цього фактору на зовнішньоторговельну безпеку держави в будь-якій країні є подвійним: як можливість зміцнити її і як загрозу її стабільності. Визначено, що пошук прийнятного балансу між можливостями зміцнення зовнішньоторговельної безпеки держави в умовах стрімкого зростання ІКТ (оцифрування), з одного боку, та ризиків, що виникають з неадекватного рівня розвитку, — з другого, різні види ІКТ-інфраструктури країни стають актуальною дослідницькою проблемою. Проаналізовано найбільш значні економічні дослідження в області теоретичних основ теорії гравітаційного моделювання та основні етапи її еволюції. Удосконалено базову гравітаційну модель торгівлі завдяки додатковому включенню показників стану розвитку ІКТ як інституційних чинників і показників зовнішньоторговельної безпеки країни в умовах країни та часових ефектів (на прикладі основної експортної товарної групи Україна — сталь та її продукція). Параметри гравітаційної моделі оцінювали на основі ретроспективних даних з використанням економетричних методів та програмних пакетів Stata або R за результатами моделювання оцінки впливу факторів розвитку ІКТ країни на обсяги зовнішньої торгівлі. Проаналізовано сталь і сталеву продукцію. Результати вказують на позитивний вплив використання Інтернету та мобільних телефонів на збільшення експорту сталі та виробів з неї. Це дає підстави для підтвердження теоретичних припущень про великі обсяги торгівлі виробами зі сталі між країнами з високим попитом і пропозицією, а також вказує на важливість зниження витрат і часу на перевезення цих товарів у країнах, які не є сусідніми. Водночас використання сучасних засобів ІКТ позитивно вплине на обсяги реалізації металургійної продукції як на внутрішньому, так і на зовнішньому ринках, за рахунок отримання конкурентних переваг щодо інших гравців на ринку.

Public enforcement in China’s securities markets: is it a “law matter”?

In recent years, with the rapid development of China's stock market and the awakening of investors’ awareness of protection, the number of public enforcements in the Chinese public securities market have exploded, and the primary regulator of the securities trading, China Securities Regulatory Commission (CSRC) has become increasingly active in providing remedies for investors. It seems that the quality of rule of law in enforcing securities law of the country has been dramatically improved. However, based on a careful analysis on a series of the cases, this statement may not be quite accurate. This paper aims to deeply explore the social and political factors that are significantly directing the enforcement of securities law in contemporary China by examining the two landmark judicial cases occurred in the recent years.

Written Testimony Before the United States House of Representatives Committee on Financial Services Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets, 'Examining Private Market Exemptions as a Barrier to IPOs and Retail Investment'

The SEC’s “Concept Release on Harmonization of Securities Offering Exemptions” seeks public comment on various items, including proposals (1) to expand or create new registration exemptions, (2) to loosen the restrictions on the secondary trading of private securities, and (3) to relax the standards for what constitutes an “accredited investor.” Such proposals would have the primary aim and effect of allowing small-dollar retail investors to invest directly in private securities. Proposals to usher retail investors into the private markets espouse two laudable goals: (1) remedying a perceived inequality of opportunity for retail investors and (2) encouraging efficient capital raising. It is my view, however, that these proposals fail on both counts, and would in fact exacerbate the very problems they purport to address. The notion that retail investors are “missing out” on the opportunity to invest in private securities is based on faith, rather than data. The available research suggests that they would do materially worse on average in the private markets than in the public markets. Nor would direct retail investment in the private markets be good for capital allocation: given the current glut of capital, firms that still cannot attract capital from institutional investors are the smallest firms with the very worst prospects. There is considerable room for disagreement over whether public companies and the public markets are subject to too much regulation. The same cannot be said for whether increasing retail-investor presence in the private markets would be good for investors or for capital allocation. If Congress and the SEC are concerned about shrinking investment opportunities for retail investors, the solution lies not in throwing retail investors to the wolves in the private markets, but rather in ensuring a healthy pipeline of companies going and remaining public.

Dual-class share structures—the Singaporean response

On 26 June 2018, the Singapore Exchange Limited (the ‘SGX’) announced amendments to its listing rules that allowed companies with dual-class share (DCS) structures to list on the Mainboard of its securities trading arm, the Singapore Exchange Securities Trading Limited (the ‘SGX-ST’). These long-anticipated amendments, the result of two rounds of public consultations which commenced on 16 February 2017, arrived shortly after its spiritual rival, the Hong Kong Exchanges and Clearing Limited (the ‘HKEx’), had on 30 April 2018 amended the listing rules of its securities trading arm to permit listings of companies with DCS (which the HKEx terms ‘weighted voting rights’) structures. The race to attract issuers with DCS structures is not surprising. Starting from 2004 with the initial public offering (IPO) by Google Inc (which has since been restructured in 2015 as a subsidiary of Alphabet Inc), some of the recent largest IPOs globally had been by...

Contrasting Worldviews at Bank and Securities Market Regulators

Bank and securities regulators operate with different attitudes about the appropriate regulation of financial institutions and markets. Bank regulators’ prudential oversight protects depositors from worrying about the repayment of their bank claims. In contrast, securities market regulators tend to presume that security markets (almost) always clear quickly at prices close to the asset’s fundamental value. These regulators seek to assure full disclosure of information, which facilitates active securities trading. In the United States, the SEC’s investor protection duties are tailored to the financial sophistication of individual investors.

Do fire sales create externalities?

We develop three novel measures of the incentives of equity mutual funds to internalize the price impact of their trading. We show that mutual funds with stronger incentives to internalize their price impact accommodate inflows and outflows by adjusting their cash buffers instead of trading in portfolio securities. As a result, stocks held by these funds have lower volatility, and flows out of these funds have smaller spillover effects on other funds holding the same securities. Our results provide evidence of meaningful fire sale externalities in the equity mutual fund industry.

Strategic Competitive Advantages through Enterprise Systems: The Case of Exchange Systems

Enterprise Systems play a key role in securities trading. Exchange operators spend great effort in overhauling their IT-infrastructure to satisfy the needs of market participants who require faster and more resilient order management cycles. Previous studies have disregarded the question whether such specific IT-investments lead to competitive advantages. Against this background, we empirically analyze the impact of exchange system upgrades on the market share of the respective exchange. Using a benchmarking approach against the closest competitor, we find that exchange system overhauls significantly increase the attracted trading volume. We conclude that investments in enterprise systems provide benefits and lead to competitive advantages for the upgrading firm.

The determinants of securities trading activity: evidence from four European equity markets

PurposeThe purpose of this paper is to obtain new empirical evidence about the connections between equity trading activity and five possible liquidity determinants: market capitalisation, dividend yield, earnings yield, company growth and the distinction between recently listed firms as opposed to more established ones.Design/methodology/approachThe authors use a sample of 172 stocks from four European markets and estimate models using the entire sample data and different sub-samples to check the relative importance of the above determinants. The authors also conduct a factor analysis to re-classify the variables into a more succinct framework.FindingsThe evidence suggests that market capitalisation is the most important trading activity determinant, and the number of years listed ranks thereafter.Research limitations/implicationsThe positive relation between trading activity and market capitalisation is in line with prior literature, while the findings relating to the other determinants offer further empirical evidence which is a worthy addition in view of the contradictory results in prior research.Practical implicationsThis study is of relevance to practitioners who would like to understand the cross-sectional variation in stock liquidity at a more detailed level.Originality/valueThe originality of the paper rests on two important grounds: the authors focus on trading turnover rather than on other liquidity proxies, since the former is accepted as an important determinant of the liquidity-generation process, and the authors adopt a rigorous approach towards checking the robustness of the results by considering various sub-sample configurations.

The Impact of Cyber-Physical Warfare on Global Human Security

Cyber is deeply enmeshed and interwoven across national security, as evidenced by its inclusion in the national security policies of a growing number of OECD countries. But it is the impact of cyber across the other components of national and human security that remains to be sufficiently addressed at the national policy level, or in international standards of behavior with respect to cyberwarfare and hybrid conflict. In addition to standing on its own as a national security concern, cybersecurity impacts economic and trade security, ecological/environmental and biosecurity, energy and critical infrastructure security, food security, transportation, and public health, as well as communications, physical and even political security. This work examines the role of threats from cyberwarfare, hybrid conflict, and cyber-physical attacks across human security from a national and global perspective, makes near-term predictions about the future of cyberwarfare, and provides recommendations with respect to preparing for cyberwarfare and ongoing hybrid conflict.