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This article examines the adaptive market hypothesis in the five most important Latin American stock indices. To that end, we apply three versions of the variance ratio test, as well as the Brock- Dechert-Scheinkman test for nonlinear predictability. Additionally, we perform the Dominguez- Lobato and generalized spectral tests to evaluate the Martingale difference hypothesis. Moreover, we consider salient news related to the plausible market inefficiencies detected by these four tests. Finally, we apply a GARCH-M model to assess the risk-return relationship through time. Our results suggest that the predictability of stock returns varies over time. Furthermore, the efficiency in each market behaves differently over time. All in all, the analyzed emerging market indices satisfy the adaptive market hypothesis, given the switching behavior between periods of efficiencies and inefficiencies, since the adaptive market hypothesis suggests that market efficiency and market anomalies might coexist in capital markets. [ABSTRACT FROM AUTHOR]

Although a rich academic literature examines the use of fake news by foreign actors for political manipulation, there is limited research on potential foreign intervention in capital markets. To address this gap, we construct a comprehensive database of (negative) fake news regarding U.S. firms by scraping prominent fact-checking sites. We identify the accounts that spread the news on Twitter (now X) and use machine-learning techniques to infer the geographic locations of these fake news spreaders. Our analysis reveals that corporate fake news is more likely than corporate non-fake news to be spread by foreign accounts. At the country level, corporate fake news is more likely to originate from African and Middle Eastern countries and tends to increase during periods of high geopolitical tension. At the firm level, firms operating in uncertain information environments and strategic industries are more likely to be targeted by foreign accounts. Overall, our findings provide initial evidence of foreign-originating misinformation in capital markets and thus have important policy implications. [ABSTRACT FROM AUTHOR]

Limited resident's participation in the stock market has become a key constraint to the capital market development. Utilizing the 2019 China Household Financial Survey (CHFS) data, our paper designs probit models to examine the peer effects of residents' stock market participation and explore the intermediary mechanisms with a multiple intermediary model. We find that: (1) Resident involvement in stock market decision-making exhibits significant peer effects. (2) Heterogeneity analysis reveals that males and rural residents display more pronounced peer effects than females and urban residents. Additionally, middle-aged residents demonstrate more potent peer effects than their younger and older counterparts, with the intensity of peer effects correlating with education levels. (3)We observe that the peer effects of market participation operate by altering economic expectations and enhancing residents' financial literacy. (4) Further investigation establishes that individuals engaging in stock market investments manifest peer effects when deciding whether to diversify their stock portfolio. This study holds reference value for analyzing the impact of social interaction on financial behaviors and regulating individuals' financial conduct. [ABSTRACT FROM AUTHOR]

An increasing number of Chinese companies are strengthening their commitment to corporate social responsibility (CSR) by reporting their carbon emission reductions. Research suggests that such voluntary environmental disclosures can reduce information asymmetry, decrease the cost of capital, and thus enhance firm value. However, a significant research gap exists because this evidence mainly derives from developed countries, with limited consideration given to emerging countries, where the capital market often lacks robust informational content. To fill this research gap, we endeavor to explore the firm-value effects of the disclosures and the magnitude of carbon reduction in China, the largest emerging market. By manually collecting data on carbon emission reductions from the CSR reports of Chinese listed companies from 2008 to 2013, we employ the balance sheet valuation model and ordinary least squares regression to investigate the firm-value effects of the disclosures and the magnitude of carbon emission reductions. The empirical results show that firm value is positively associated with not only voluntary carbon emission reduction disclosures, but also the magnitude of carbon emission reductions. In our sample, for every additional ton of carbon emission reduction, firm value increases by approximately 340 yuan (equivalent to 44 euros or 52 US dollars). We also find that the firm-value effects of carbon emission reductions are more pronounced in high-pollution industries than those in low-pollution industries. Further channel tests reveal that on average, agency problems, as measured by selling, general, and administrative expenses, are lower in firms that disclose carbon emission reduction information than those that do not. In addition, firms with carbon emission reduction disclosures can obtain more green subsidies than those without such disclosures. To mitigate climate risk, firms should proactively engage in carbon emission reductions, which can potentially receive a positive recognition from the capital market. Our study also provides valuable insights for regulators in terms of establishing and enhancing carbon accounting standards to encourage corporate involvement in carbon reductions. [ABSTRACT FROM AUTHOR]

Climate risk represents an increasingly vital issue to countries, companies, and institutional investors, making it a reality but not a distant threat to humanity. Considering the effects of climate risks on firms’ financial indices and financing options, the study investigates whether climate risk is priced by the capital markets of South Africa. The study used reported carbon emissions as a measure of climate risk of 81 listed companies in the Johannesburg Stock Exchange from 2011 to 2020 to examine whether climate risk is considered and priced by the South Africa capital market. Data was sourced from DataStream database- a global financial and macroeconomic time-series database providing data on equities, stock market indices, currencies, company fundamentals, fixed income securities, and key economic indicators. We used the two-step system Generalized Method of Moments estimation technique that copes with endogeneity concerns to corroborate the effects of climate risk on cost of capital and capital structure. We find that climate risk is priced in both cost of debt capital and cost of equity capital. Specifically, we find that an increase in a firm’s exposure to climate risk increases the cost associated with issuing debt and equity capital. We also find that climate risk exposure decreases the debt-equity ratio. Additionally, the study showed that firm size, leverage ratio, capitalization, profitability, and turnover affect both cost of capital and capital structure of listed firms. The study concludes that climate risk is priced in cost of financing in the capital market of South Africa. The study recommends that firms should invest in installing ecofriendly machinery that aligns with changing market expectations in order to reduce their carbon emissions. The study therefore highlights the need for companies to proactively assess and manage climate risks, incorporate climate considerations into their strategic decision-making, and enhance their resilience to climate-related challenges. [ABSTRACT FROM AUTHOR]

Capital markets are essential for a country's development. However, the effort to develop a sustainable capital market may be challenged by many uncertainties, such as pandemics, politics, and investor behavior. This study aims to unveil the future of Indonesia's capital market and provide implications and options for stakeholders to develop a best-practice capital market. The scenario personarrative method, including cluster analysis, is used in this research as it can complement each other by signifying options to different types of investors. Data were gathered from interviews with 25 experts and a questionnaire survey of 438 respondents. With an analysis emphasizing the government's political direction and regulator ability, four transformative scenarios were constructed: (1) thin bull in the pastureland, (2) facing Torero in the bullring, (3) train the circus bull, and (4) world-champion bull. Eight personas were described, each with unique characteristics. Finally, 32 behavioral narratives were constructed based on the four scenarios and eight personas with the options provided. These results benefit stakeholders when deciding on acting in Indonesia's capital market. It is recommended that stakeholders carefully consider ensuring that Indonesia's capital market can achieve the world champion bull scenario in 2030. [ABSTRACT FROM AUTHOR]

Research background: Conventional CAPM is a well-known and tested theory on various capital markets. It was also repeatedly rejected as a model of capital pricing. This article proposes a different approach to both CAPM testing and the use of other risk measures. In addition, research is global, including emerging countries. Purpose of the article: This paper investigates the standard CAPM, and this model is based on higher moments of the return distribution for the global emerging market. In addition, this paper aims to compare the conventional and downside CAPM versions using the beta coefficient and co-moments. Methods: Contrary to the classical unconditional tests for the risk premium, conditional relationships are also estimated considering the market portfolio condition. Moreover, the studies considered conventional and downside approaches to risk measures. The cross-sectional regressions are based on the Fama-MacBeth (F-M) procedure and panel models. Findings & value added: The findings contribute to the debate on whether beta coefficient and higher order co-moments in conventional and downside approaches can explain the crosssectional emerging indices returns. The unconditional models using all measures do not significantly describe the cross-sectional volatility of returns. The cross-sectional regressions in up and down-market based on both the classic F-M procedure and panel models show that the beta and co-kurtosis risk premium is significant and depends on market conditions. The risk premium for co-skewness is not valid, and the direction of the relationships is opposite than expected. Research also demonstrates that the test results of CAPM relationships are not robust to the presence of outliers and shocks resulting from the Covid-19 pandemic in the context of risk-return space. Research provides strong support for the importance of downside risk in the context of standard CAPM and, above all, higher co-moments. [ABSTRACT FROM AUTHOR]

In recent years, with the continuous development of the capital market and intelligent internet of things (IIoTs) technologies, investors have focused more on IIoTs enterprises' stocks. Since the stocks of IIoTs enterprises have the characteristics of heavy capital flows and high stock price volatility, the effective prediction of IIoTs stock price changes plays an extremely important role in improving investment returns and controlling investment risks. According to the above characteristics, our model takes stock trend fluctuations and time series indicator changes into consideration and comprehensively captures IIoTs stock information from both the temporal domain and the spatial domain. Specifically, the proposed model is a dual-view model that incorporates selected trading indicators to predict the closing prices of stocks. In the first view, an RNN model is designed to enlarge the receptive field of the model. In the second view, we introduce an attention mechanism to extract the influences of individual stock trends on the forecasting target. To verify the validity of this prediction method, we compare it with six other stock prediction methods. The results show that on the Ping An (601318) and IFLYTEK (002230) datasets, our method achieves the best results, that is, the lowest RMSE values. [ABSTRACT FROM AUTHOR]

Digital transformation is an emerging development opportunity for enterprises in the digital economy and comprehensively reflects the application of digital technology to production, operation, and management strategies. This study used data on A-share listed enterprises in Shanghai and Shenzhen from 2007 to 2022 to examine the relationship between the digital transformation of enterprises and information efficiency of the capital market. Findings revealed that digital transformation can improve the information efficiency of the capital market and that environmental uncertainty plays a more significant regulatory role. The greater the environmental uncertainty, the more enterprises with a high degree of digital transformation can promote the information efficiency of the capital market. Additional analysis showed that the promotional effect of digital transformation on the information efficiency of the capital market is better for non-state-owned enterprises and small and medium-sized enterprises. This study provides detailed insights into digital transformation and capital market information efficiency, which enriches the research related to the economic consequences of digital transformation and demonstrates the theoretical and practical value of corporate digital transformation. [ABSTRACT FROM AUTHOR]

Purpose: The purpose is to make reflections from a historical, conceptual and comparative review on goodwill in one hundred years of accounting theory, still considered a difficult topic with the theoretical and normative evolution. Methodology: Theoretical essay produced from an integrative qualitative literature review. It presents the theoretical evolution and challenges observed by theorists and regulators since the seminal study "Accounting Theory" by William Paton (1922). Results: The relevance attributed to goodwill goes far beyond the concepts and criteria for recognition and measurement. Its interpretation and processing are influenced by cognitive aspects, economic interests, and in a moment of economic crisis, debates on the topic are intensified, motivated by stakeholders' concerns, regulators and theorists, the same in one hundred years of evolution. So, the future of goodwill is undefined. Contributions of the Study: The historical and comparative analysis, limited in the choice of the references on the subject, contributes to confirm the subjectivity and absence of conceptual, normative and practical consensus for goodwill, thus there aren't right or wrong among theorists and regulators. The scenario of high volatility in the capital markets during Covid-19 pandemic, for example, arose new theoretical discussions about the quantum and multidisciplinary dimension and the possible return of Accounting practices used in the past. Therefore, the relevance of goodwill requires that not only regulators establish rules, but that theoretical and practical ethically contribute to the debate. [ABSTRACT FROM AUTHOR]

Purpose: The growth and development of defence industries are essential to improve deterrence and national security. One way to develop such industries is to acquire technology-based firms that, in addition to improving the ability to manufacture new products, can help them meet their operational and strategic goals. Since the valuation of such firms is considered one of the complexities of acquisition, this paper aims to propose a model for their valuation according to the ecosystem of defence industries. Design/methodology/approach: To create the model, first the literature in this field has been investigated. Also, the comments and proposals of senior managers, technical designers and experts, economic and financial specialists, and R&D experts in the defence industries have been surveyed and then, the valuation criteria for technologybased firms have been identified using the fuzzy screening technique. Next, by using the fuzzy Analytic Hierarchy Process (AHP), the relative importance coefficients for components, criteria, and subcriteria have been determined, and the valuation model has been developed. Finally, the function of estimating the value of technology-based firms that can be acquired in the Department of Defense (DOD) has been formulated. The study was carried out at the end of 2022 in DOD strategic organizations. Findings: Since knowledge and intellectual properties are the most significant pillars and competitive advantages of technology-based firms, the results showed that the “intangible assets” criterion is the most significant one for the valuation of firms by a weight of 0.449. Following the criterion are the tangible assets, and the major risks with a weight of 0.351, and 0.20, respectively. In this study, the strategic role and importance of technology-based firms for the defence industries, their synergy with these industries, the protection requirements, as well as the stability and durability of the technologybased firms in the condition of disruption were introduced as specific criteria in the valuation model for the firms. Also, the result of the sensitivity analysis indicated that the ranking of options is the most sensitive subject to changes in the importance and weight of intangible assets and the main risk. Research limitations/implications: One of the limitations of the research is that this study was not conducted in a specific defence industry such as electronics and radar, energy-rich materials, chemical, air, or marine industries, and was comprehensively planned in all industries. Since tangible, and intangible assets or even risks may be different in each of such industries, this issue leads to the cautious use of the model in each of these specialized areas. Another limitation was the research statistical population, which only included university professors, senior managers and financial managers of defence industries. Although using the opinions of capital market valuation experts venture capitalists and expert valuation experts of the country's innovation and knowledge ecosystem for further validation of the model and criteria statistics and to specify the specific conditions of valuation in the defence environment, seemed useful, there were limitations in their assessment. Originality/value: Proposing a hybrid model including tangible and intangible assets and considering risks, and also considering the key criteria of the defence sector such as strategic importance, synergy stability and durability of firms, as well as providing functions for estimating the value of technology- base firms that can be acquired in DOD are considered as the two of the most important aspects of contributions and innovations of this research. The current model provides a systematic and scientific plan for defence industry managers and experts who can use it in the valuation of companies that can be acquired in the defence industry and be sure that their interests are taken into account. [ABSTRACT FROM AUTHOR]

Investors generally aim to obtain a high return from their stock portfolio. However, investors must realize that a high value-at-risk (VaR) is essential to calculate for this aim. One of the objects in the VaR calculation is the asymmetric return volatility of stocks, which causes an unbalanced decrease and increase in returns. Therefore, this study proposes a mean-value-at-risk (mean-VaR) stock portfolio optimization model based on stocks' asymmetric return volatility and investors' risk aversion preferences. The first stage is the determination of the mean of all stocks in the portfolio conducted using the autoregressive moving average Glosten–Jagannathan–Runkle generalized autoregressive conditional heteroscedasticity (ARMA-GJR-GARCH) models. Then, the second stage is weighting the capital of each stock based on the mean-VaR model with the investors' risk aversion preferences. This is conducted using the Lagrange multiplier method. Then, the model is applied to stock data in Indonesia's capital market. This application also analyzed the sensitivity between the mean, VaR, both ratios, and risk aversion. This research can be used for investors in the design and weighting of capital in a stock portfolio to ensure its asymmetrical effect is as small as possible. [ABSTRACT FROM AUTHOR]

This study examines the impact of capital market on the relationship between energy consumption and carbon emissions. By employing a system Generalised Methods of Moments (GMM) for a sample of 138 developing countries over the period, 1990–2020, we find a U-shaped reverse relationship between renewable energy consumption and carbon emissions. The study reveals that beyond a threshold of 71.03, renewable energy consumption tends to increase carbon emissions. Similarly, the initial levels of carbon emissions reduce the use of renewable energy but beyond a 2.5 level of carbon emissions, renewable energy consumption begins to increase. We find that both the stock market and bond market reduce carbon emissions and enhance the levels of renewable energy consumption. We provide evidence to support that the capital market enhances the negative impact of renewable energy consumption on carbon emissions, while the corporate bond market magnifies the reductive effect of carbon emissions on renewable energy consumption. [ABSTRACT FROM AUTHOR]

I study the social efficiency and aggregate effects of equity home bias using a general equilibrium model with nominal rigidities and a fixed exchange rate. I find that the source of home bias is key for analyzing the wedge between equilibrium and socially optimal levels of home bias. Surprisingly, when home bias is due to labor income hedging effects, stock positions tend to be approximately efficient despite the aggregate demand externalities induced by the rigidities. On the other hand, home stock positions are excessive when home bias is due to financial frictions or biased expectations. The key theoretical results hold numerically well in a more general quantitative model. [ABSTRACT FROM AUTHOR]

On the capital market, price movements of stock corporations can be observed independent of overall market developments as a result of company-specific news, which suggests the occurrence of a sudden risk event. In recent years, numerous concepts from statistical physics have been transferred to econometrics to model these effects and other issues, e.g., in socioeconomics. Like other studies, we extend the approaches based on the "buy" and "sell" positions of agents (investors' stance) with a third "hold" position. We develop the corresponding theory within the framework of the microcanonical and canonical ensembles for an ideal agent system and apply it to a capital market example. We thereby design a procedure to estimate the required model parameters from time series on the capital market. The aim is the appropriate modeling and the one-step-ahead assessment of the effect of a sudden risk event. From a one-step-ahead performance comparison with selected benchmark approaches, we infer that the model is well-specified and the model parameters are well determined. [ABSTRACT FROM AUTHOR]

Inattention of economic policymakers to default risk and making inappropriate decisions related to this risk in the banking system and financial institutions can have many economic, political and social consequences. In this research, it has been tried to calculate the default risk of companies listed in the capital market of Iran. To achieve this goal, two structural models of Merton and Geske, two machine learning models of Random Forest and Gradient Boosted Decision Tree, as well as financial information of companies listed in the Iranian capital market during the years 2016 to 2021 have been used. Another goal of this research is to measure the predictive power of the four models presented in the calculation of default risk. The results obtained from the calculation of the default rate of the investigated companies show that 50 companies listed in the Iranian capital market (46 different companies) have defaulted during the 5-year research period and are subject to the Bankruptcy Article of the Iranian Trade Law. Also, the results obtained from the ROC curves for the predictive power of the presented models show that the structural models of Merton and Geske have almost equal power, but the predictive power of the Random Forest model is a little more than the Gradient Boosted Decision Tree model. [ABSTRACT FROM AUTHOR]

This study empirically tests the effect of stock risk warning of listed companies on the risk of stock price crash of non-warning companies in the same industry and its mechanism in the Chinese A-share listed companies from 2008 to 2021 as samples. The research results show that the risk warning information has a capital market governance effect on peer companies, that is, the new risk warning information in an industry will alleviate the risk of stock price crash of peer companies. This conclusion remains robust after a series of robustness and endogeneity tests. The mediating mechanism test shows that the idiosyncratic information content of the stock price mediates the process of risk warning information affecting the risk of stock price crash of peer companies. The heterogeneity test shows that the governance effect of risk warning information on the risk of stock price crash of peer companies is more significant when the problem of company agency is more serious, the competitive market position is lower, or the differences in opinion among investors are smaller. This study provides empirical evidence for the necessity of the existence of the risk warning system. Additionally, it provides a reference for the capital market risk supervision of similar transition economies such as China. [ABSTRACT FROM AUTHOR]

This research paper provides a comparative analysis of the legal frameworks governing the delisting of issuer shares in Indonesia, the United States, and Singapore. Using a normative legal research approach, supplemented by interviews with members of the Financial Services Authority (OJK) and a Member of the House of Representatives Commission XI, the study explores how each jurisdiction addresses the delisting process, particularly focusing on the protection of minority shareholders . The analysis reveals that Indonesia's legal system, influenced by its Civil Law heritage, contrasts with the Common Law approaches of the US and Singapore, especially in terms of shareholder involvement in voluntary delisting and the specificity of conditions for forced delisting. The study suggests enhancements to the Indonesian framework, such as clearer guidelines for shareholder approval in delisting decisions and more transparent criteria for forced delisting. These recommendations aim to improve the protection of minority shareholders within Indonesia's Capital Market. [ABSTRACT FROM AUTHOR]

A higher efficient capital market and direct financing environment are key to excellent enterprise performance and high-quality economic development in China. In recent years, institutional investors have gradually significantly impacted market information efficiency, while the existing studies still offer different conclusions. Given this, firstly, we chose the social network analysis as the study method, taking the open-ended equity mutual funds in the A-share stock market from 2010 to 2019 as samples, constructing the shareholding networks by taking the top ten bulk-holding stocks in every sample fund's annual report as the connection. Then, we chronologically reveal the characteristics of those networks, such as scale, density, centrality, and so on. Lastly, we empirically test the influence of the institutional investors embedded in the shareholding networks on the information efficiency, and so does the robustness check. The results show that the shareholding networks are gradually expanding in scale and increasing in density. Furthermore, institutional investors can improve stock price informativeness and promote market information efficiency through a shareholding network, and the higher the network location of institutional investors, the greater the information effect. The conclusions based on the systemic view not only enrich the research on the information function of institutional investors, broaden the field of social network theory, but also provide guidance for regulating institutional investors and improving market transparency. [ABSTRACT FROM AUTHOR]

Information transparency plays a vital role for developing capital markets. Using data of A-share listed companies from 2007 to 2020, this study examined the impact of customer concentration on corporate information transparency from a supply chain perspective. It suggests that a significant negative correlation exists between customer concentration and information transparency. Customer concentration affects the quality of corporate information disclosures. Through the mechanism test, the impact of customer concentration on corporate information transparency is based on the risk effect rather than the substitution effect of private information on public information. Research on regulatory effects points out that a poor internal information environment aggravates the negative relationship between customer concentration and information transparency. However, media supervision and a higher marketization process alleviate the adverse effects of customer concentration on information transparency. This study indicates that firms with a higher customer concentration have a higher risk of information disclosure, which provides a reference point for investors for making investment-related decisions and for the capital market supervision department for formulating information disclosure policies. [ABSTRACT FROM AUTHOR]

Financial auditing is one of the cornerstones of an effective capital market structure. When performed correctly, an independent financial audit provides investors with the security they need to effectively transact based on company disclosures. When this system fails, however, the results for investors and the economy as a whole can be devastating. In recognition of this danger, the market for financial auditing in the United States is regulated by a number of governmental and nongovernmental bodies charged with maintaining its health and effectiveness. But stakeholders within the U.S. market and government have criticized these regulators for failing to adequately respond to concerns lurking in the country's financial auditing system. While audit reform can be an expensive and convoluted process, this Note argues that U.S. regulators can streamline the field's development by monitoring and building upon the actions taken by U.K. regulators. This Note describes the current audit regulatory structure employed by the United States and examines the most pressing concerns expressed by interested parties. It then analyzes the findings and proposals offered in the U.K. Competition and Markets Authority's comprehensive report on competition and audit quality in the U.K. financial auditing market. This Note proposes that the conclusions of the Competition and Markets Authority's report should serve as both a warning and a guide for domestic audit regulators. The United States is past due for a comprehensive examination of their financial auditing system. Using the U.K. findings as a guide will provide more immediate and relevant data for policymakers and regulators alike. [ABSTRACT FROM AUTHOR]

In response to escalating environmental uncertainty, corporate executives typically adjust their business strategy between diversification and refocusing. This study examines the effect of environmental uncertainty on idiosyncratic risk, as well as the moderating impact of diversification on this relationship. Utilizing a sample of companies listed on the Chinese stock market from 2005 to 2019, the results suggest that a significant positive correlation exists between uncertainty and idiosyncratic risk. As environmental uncertainty escalates, corporate managers increasingly opt for diversification before eventually refocusing their business strategy. Furthermore, while moderate diversification can mitigate the impact of uncertainty on idiosyncratic risk, excessive diversification intensifies this correlation. This research holds considerable significance for understanding the influence mechanism of idiosyncratic risk and ensuring the stability of the capital market. [ABSTRACT FROM AUTHOR]

This study selects Chinese A-share listed enterprises from 2010 to 2020 as the research sample, constructs a Difference-in-differences model to analyze the Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect policy on enterprise green innovation. The transmission channels are tested, and the heterogeneity of this impact is further explored. It is found that the Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect policy has significantly improved the total level, quality and quantity of enterprise green innovation, and the effect on the total level and quality is greater than the quantity. The Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect policy can effectively alleviate the financing constraints faced by enterprises, improve the information environment of enterprises, and thus improve their green innovation. There is heterogeneity in the nature of property rights, corporate social responsibility, industry monopoly and regional marketization in the promotion of enterprise green innovation by the Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect policy. [ABSTRACT FROM AUTHOR]

Purpose: The present case is intended to teach but encourage the discussion of company valuation techniques and their contributions to choices regarding investment in stocks. Through the teaching case, students will be able to apply valuation techniques and discuss the assumptions that are fundamental for the applicability of valuation methodologies. Methodology: The methodology of the aforementioned case is quantitative, since, based on business assessment models, the students will assess and analyze the data of the company proposals to apply the best assessment technique on the ethics of Financial Theory. Through valuation, students will be able to find different results given the assumptions determined for the analysis of the company. Results: Based on the data, it is possible to make inferences and financial projections of the analyzed company and discuss the best technique to be used, as well as the feasibility of investing (or not) in the analyzed company. Contribuitions: It is expected that the aforementioned teaching case will be an instrument for the applicability of valuation techniques in other companies and complement teaching in undergraduate and graduate courses in disciplines related to finance and capital markets. [ABSTRACT FROM AUTHOR]

Purpose: One of the reasons for the failure in developing knowledge-based cities is the incomplete understanding of the dimensions and factors involved in this type of development, as well as the fundamental weakness in determining the strategic priorities of programs and resource allocation decisions. The main achievement of this article is the introduction and explanation of the model of knowledge-based development for cities in a dynamic and integrated manner. The elements of knowledge-based development are effectively explained, relying on the insights of experts in this field. And it has been explained. The application of knowledge is a key factor in sustaining growth and development. In the context of a country's progress, knowledge is considered a competitive advantage in economic, social, political, and cultural matters. Therefore, the development of knowledge-based cities is an approach in which the application of knowledge and information is of great importance. The economy, production, employment, and overall growth are formed based on this approach, and investment in knowledge-related fields has attracted the attention of developed countries. The aim of the study is to identify the components of development in knowledge-based cities. Method: The study population for this research comprises specialists and experts with knowledge of the research subject. The snowball or chain sampling method, a non-probability sampling technique, will be used when the study units are not easily identifiable. This method was chosen because the units under study were very rare and constituted a small portion of the statistical population. The sample size was determined using saturation or judgmental (targeted) sampling. The researchers achieved theoretical saturation after interviewing 32 people but continued the interviews with 38 people to ensure thoroughness. Data collection was conducted through semi-structured interviews. Findings: The data obtained from the interview, regarding the main research question of identifying the dimensions and components of the development of knowledge-based cities; after categorization and coding, thematic analysis was done Five categories were extracted for the development of knowledge-based cities, which are: 1. Knowledge-based economics with 5 components including: development of advanced industries; incentive and support system; creating a knowledge capital market; smart economy; Smart businesses; 2. intelligent governance with four components including: creating a development-oriented government; freedom of information; development of electronic government; Development of technology infrastructure; 3. Knowledgebased community with four components including civil awareness; intelligent people; knowledgebased education; and Information Society; 4. improving the knowledge of development management with four components including knowledge-based organizations; Development of knowledge cities; Sustainable Development; Development of technical and executive systems and 5. Knowledge and technology policy with five components including commercialization of knowledge; research and development centers; promoting science and technology; National innovation system; and Development of knowledge management. Key success factors in developing knowledge-based cities include: 1. Development of research and development centers and science and technology parks. 2. Attention to single industries. 3. Attention to knowledge management. 4. Strengthening knowledge human capital. 5. Development of technology infrastructure. 6. Creating a national model of innovation. 7. Development of smart and knowledge-based economies. 8. Development of smart governance infrastructure. 9. Network business development. It is suggested that managers create poles of knowledge and technology; develop technological infrastructure; and support systems; Create and development of knowledgebased entrepreneurship and knowledge-based management should take necessary measures. Conclusion: The key success factors in the creation and development of knowledge-based cities include: 1. Development of research and development centers; 2. Development of science and technology parks; 3. Attention to hi-tech industries (high technology); 4. Expansion of knowledge management in various matters; 5. Strengthening human capital and knowledge; 6. Expanding and developing the infrastructure of new communication and information technologies; 7. Creating a national model of innovation; 8. Development of national technical and scientific networks; 9. Paying attention to the development of necessary infrastructure for networked and smart businesses and other cases. [ABSTRACT FROM AUTHOR]

This paper aims to identify macroeconomic factors that influence IPO implementation in selected Central and Eastern European capital markets. Survey based research has been conducted within a sample of non-financial companies operating in the Czech Republic, Croatia, Hungary, Poland, and Romania. The results suggest that favorable macroeconomic conditions such as GDP growth, low interest rates or positive development of local capital markets promote companies´ interest in IPO implementation. [ABSTRACT FROM AUTHOR]

The impact generated by the accelerated development of NFT's creates a series of risks and legal problems, among which the legal, the impact on intellectual property, the protection of the purchasers of this type of tokens, fraud prevention and the possible impact of NFT's on financial markets are the most important. The purpose of this document is to analyze whether the regulatory framework of the securities market is applicable to NFT's based on the following assumptions: i) NFT's, understood individually as a digital representation, cannot be considered as securities; ii) in States where the definition of securities includes the concept of "investment contract", NFT's could be considered as securities, as long as they meet the requirements of the Howey Test; iii) in States where there is no definition of investment contracts, NFT's could be considered as securities, provided that they meet the requirements for such purpose--the existence of a negotiable right, issued in mass or in series within a public offering of securities, and that its purpose is to obtain resources from the public by way of investment--; and iv) that the recognition of NFT's as securities would lead to the application of regulatory frameworks of the capital market in matters such as registration before the financial authorities, provision of information and investor protection schemes. This text will describe the origin and current scenario of NFT's. Likewise, the different positions of supervisory and regulatory authorities at a global level will be analyzed with respect to these tokens; and, finally, some reflections will be made from the point of view of securities market regulation with respect to the aforementioned non-fungible tokens. [ABSTRACT FROM AUTHOR]

In recent years, uptier transactions have emerged as a novel way for distressed companies to restructure their debt obligations, resulting in unforeseen and inequitable outcomes for investors in corporate debt. Uptier transactions depend on provisions in credit agreements that permit debtholders with a majority stake in a class of debt to make decisions on behalf of all debtholders. Distressed companies take advantage of these provisions by colluding with a majority of debtholders to shift economic value from the remaining debtholders to themselves. As this Comment demonstrates, these transactions are likely to be value destructive and present an issue for capital markets. Unfortunately, the contractual solutions available to debtholders to prevent uptier transactions either are insufficient or impose substantial costs on parties. Uptier transactions may be a recent innovation in restructuring, but they are an instance of investor opportunism that is present whenever there is common ownership in property--those with control over common property can exercise that control in a way that benefits themselves to the detriment of other owners. Corporate law has resolved this issue in the equity context by imposing a fiduciary duty of loyalty on controlling shareholders. This Comment proposes treating debtholder control over debt covenants as akin to the control that large shareholders wield over corporations by imposing a waivable fiduciary duty of loyalty on controlling debtholders. The controlling shareholder doctrine in Delaware corporate law provides a useful starting point to consider how courts could enforce a controlling debtholder fiduciary duty in a way that would provide adequate judicial oversight over the most concerning transactions while limiting disruption to productive transactions. [ABSTRACT FROM AUTHOR]

We analyze volatility contagion between the U.S. and Chinese stock markets and international capital markets. The volatility is modeled using: GARCH, TARCH, EGARCH, APARCH, IGARCH, FIGARCH, ACGARCH and GAS models under Gaussian, GED and t-Student distributions. 21,000 intraday observations of thirteen markets from January/1st to June/25th 2020 are employed. Once volatility is modeled, the incidence of Chinese and American markets on the rest of the bourses is tested employing Vector Autoregressive Markov Switching Models. Evidence confirms incidence of the Chinese and American capital markets volatility in other markets volatility; common breakpoints and Intermarket incidence in high volatility periods stand out. [ABSTRACT FROM AUTHOR]

Each company carries out its activities with different financial resources. Their use then affects the cost of equity and profitability of investments, which determines the possibility to compete in the capital market. Thus, this study is provided in order to define the financing policy with a proper capital structure that is able to minimize the cost of equity of the company in order to improve its financial competitiveness. The research focuses on Ukrainian food processing companies in the period 2013-2020. The cost of equity is calculated using the modified CAPM model and the methodology of Aswath Damoradan. The US Treasury bond rate as the risk-free rate, equity risk premium, and unlevered β-coefficient for food processing companies in emerging markets were taken from his databases. The leveraged β-coefficient was determined, considering the interest-bearing liabilities and the trade payable of the companies analysed. The cost of equity and its weighted cost were calculated within variants of the conservative, moderate, and aggressive financing policies. The results indicate that the lowest cost of equity occurs in the variants of conservative, moderate, and super-aggressive financing policies based on the financial independence of the company. Conversely, the lowest weighted cost of equity is identified for the aggressive and super-aggressive financing policies with negligible equity but significant use of non-interestbearing debt. The link between the cost of equity (its weighted cost) and the use of debt is rather weak in the sample of firms examined. Although the relation is direct for the cost of equity, the correlation coefficients show an inverse relationship for its weighted cost. This confirms that the choice of an appropriate variant of financing policy can lead to minimising the cost of equity and increasing the financial competitiveness of the firm. [ABSTRACT FROM AUTHOR]

The study analyzed the association between environmental, social and governance (ESG) and the life cycle stages of Brazilian publicly-traded companies listed on the B3 S.A. - Brasil, Bolsa, Balcão (B3) from 2010 to 2020. It explores a theoretical gap regarding the relationship between the life cycle stages of companies and ESG initiatives in Brazil, an emerging country. The findings are relevant for understanding how the life cycle stages act as signals of the level of ESG actions of companies and how the market perceives these actions and their ability to create value. The research provides evidence that the fundamentals of the firm life cycle theory function as indicators for several organizational perspectives, including ESG practices. The sample consisted of 109 companies whose data were collected from Thomson Reuters® and analyzed using multiple regression. The model proposed by Dickinson (2011) was used to analyze the life cycle stages. It should be highlighted that the data were also analyzed using the fixed effect as an estimation of the econometric model, but there was a loss of statistical significance in the relationship found, possibly due to the sample selection performed in the unbalanced panel. Based on the sample analyzed and the econometric models used, the results indicate that companies in the birth and turbulence stages have lower levels of ESG practices, particularly in the environmental and social pillars, compared to companies in the maturity stage. The findings also show that ESG initiatives in the Brazilian capital market are associated with measures of companies' profitability, liquidity, indebtedness, market value, and number of analysts. The research contributes to the analysis of the relationship between the adoption of ESG practices and the life cycle stages of companies in an emerging market, with implications for stakeholders regarding the targeting of resources to sustainable actions. [ABSTRACT FROM AUTHOR]

This article examines the effect of the heterogeneity of shareholder coalitions on the distribution of dividends in companies listed in Brazil. To analyze the relationship between large shareholders and dividends, it is essential to consider the way the control is ensured. Large shareholders can share control by forming coalitions, and differences in the composition of coalitions can alter the incentives the cooperating parties have for the activity of monitoring. Based on shareholder agreements, we explore the heterogeneity among shareholder coalitions by presenting elements that can characterize the role of shared control in the corporate governance of companies in a market environment described by the concentration of control in a single large shareholder. This study presents potential economic and social impacts, as it is of particular interest to outsider shareholders, and even potential investors, to know how insiders can use dividend policy, since the distribution of profits tends to mitigate agency problems. To identify the shareholder coalitions we resorted to shareholder agreements. The analysis model was estimated using the two-stage system generalized method of moments (GMM-Sys) with unbalanced panel data for the period from 2008 to 2019. We discovered that the number of shareholders in the coalition and the leveraging of the voting rights of the biggest shareholder in the coalition are negatively related to the dividends distributed, and that the voting rights of the coalition are positively related to the dividends distributed. These results contribute to the principal-principal approach of agency theory and highlight that the incentives and capacity of shareholder coalitions to pursue private benefits of control depend on their own characteristics. [ABSTRACT FROM AUTHOR]

This study uses structural entropy as a valuable method for studying complex networks in a macro-finance context, such as the European government bond market. We make two contributions to the empirical literature on sovereign bond markets and entropy in complex networks. Firstly, our article contributes to the empirical literature on the disciplinary function of credit markets from an entropy perspective. In particular, we study bond yield differentials at an average daily frequency among EU countries' 10-year Eurobonds issued between 1 January 1997, and 4 October 2022. Secondly, the article brings a methodological novelty by incorporating an entropy perspective to the study of government bond yield differentials and European capital market integration. Entropy-based methods hold strong potential to bring new sources of dynamism and valuable contributions to the areas of macroeconomics and finance. [ABSTRACT FROM AUTHOR]

The merger and acquisition world has experienced an uptick in deal flow since 2016, reaching unprecedented levels in 2020 due to enhanced private equity funding and market volatility. While the market volatility spurred by COVID-19 halted traditional initial public offerings (IPOs), the special purpose acquisition company (SPAC) market exploded. The flurry of SPAC activity in the United States triggered the development of SPAC markets worldwide. Unfortunately, SPACs' great rise to fame in the past few years has come at a cost--fraud. As such, the US Securities and Exchange Commission (SEC) is left grappling with how to best regulate the market moving forward, avoiding a return to rampant fraud that plagued the market in the 1980s. This Note assesses the current SPAC regulatory framework in the United States and abroad. The solution suggests that capital markets should impose modest preventative measures that enable SPACs to occupy their own sphere in capital markets while also affording greater investor protections. [ABSTRACT FROM AUTHOR]

Equity incentive, as an institutional arrangement for the coordination of the interests of shareholders and managers, has been widely implemented by public companies in developed capital markets throughout Europe and America. However, does it work and/or when might it be more effective in emerging market economies such as China? We aimed to understand the effects of equity incentive plans implemented by listed companies in China and the potential influence of the general characteristics of contracts on the effectiveness of equity incentive plans. Based on behavioral decision theory, this paper adopts a multivariate linear regression model to analyze the 1695 equity incentive plans implemented in Chinese listed companies between 2010 and 2018 with their two-year lagged performance data. The empirical results show that the operational performance of companies after implementing equity incentive plans shows a trend of polarization. In the 95% confidence interval, the effect of restrictive stock incentive and exercise-constrained variables is not significant, while the validity period has a significant positive correlation and incentive intensity has a significantly negative correlation with the company's operational performance. Furthermore, the negative effects mentioned above become more obvious with a longer plan implementation period. Based on these conclusions, we suggest that companies could adopt equity incentive plans with a relatively longer validity period and more reasonable incentive intensity. Additionally, it would be better for companies to select non-restricted stocks as incentive tools if there is no obvious preference. [ABSTRACT FROM AUTHOR]

In the era of innovation dividends, whether investors, as the main participants in the capital market, can tolerate enterprise innovation activities is the key to whether the capital market can help enterprises innovate. This paper takes the listed companies of Shanghai and Shenzhen A-shares in China that disclosed quantitative performance forecasts from 2016 to 2021 as samples, obtains the market reaction of performance forecasts through the event study method and uses them as proxy variables of investors' short-term performance expectations, and uses multiple regression analysis to explore the impact of corporate R&D on investors' short-term performance expectations. The results are as follows: (1) corporate R&D investment significantly reduces investors' short-term performance expectations (that is, investors have a significant tolerance effect on enterprises with higher R&D investment); (2) the increase in the shareholding ratio of institutional investors weakens the tolerance effect; and (3) with the implementation of China's innovation-driven strategy, the tolerance effect of its capital market on enterprise R&D gradually increases, especially for high-tech companies, but has a low tolerance effect on state-owned companies' R&D risk. The results show that investors in China's capital market are not completely rational in their response to corporate R&D, and investors are willing to bear more short-term performance losses for high R&D investment, which is consistent with prospect theory. [ABSTRACT FROM AUTHOR]

Recent years have witnessed the near total triumph of market efficiency as a regulatory goal. Policymakers regularly proclaim their devotion to ensuring efficient capital markets. Courts use market efficiency as a guiding light for crafting legal doctrine. And scholars have explored in great depth the mechanisms of market efficiency and the role of law in promoting it. There is strong evidence that, at least on some metrics, our capital markets are indeed more efficient than they have ever been. But the pursuit of efficiency has come at a cost. By focusing our attention narrowly on economic efficiency concerns—such as competition, friction, and transaction costs—we have lost sight of other, deeper values within our economic system, including wider conceptions of duty, fairness, and morality. And while regulators sometimes pay lip service to these values, they often treat them as merely a subset of efficiency: the best way to treat investors fairly, to promote equality, and to prevent immoral, exploitative behavior, in this view, is simply to create an efficient market. We have seen the consequences of this emphasis play out in spectacular fashion in the last decade. New market structures and technologies—from special purpose acquisition companies to social-media oriented trading apps to cryptocurrencies—have emerged to eliminate barriers to trade and compete with institutional incumbents. These strategies may well lead to more efficient markets insomuch as they facilitate access to capital, but they also have the side effect of placing unsophisticated individuals into complex contractual arrangements with sophisticated market actors. The result is an “efficient” market, but one with steep moral and social costs. This Article examines the limits of market efficiency as a regulatory goal and suggests a set of structural and substantive reforms aimed at better balancing efficiency with the other goals of markets. It concludes that regulators, courts, and scholars alike need to adopt a more comprehensive understanding of the proper ends of market regulation, one that emphasizes the purpose and spirit of finance over the false promise of efficiency. [ABSTRACT FROM AUTHOR]

Purpose: The objective of this study is to analyze the effects of adopting CPC 47 on the level of the earnings management of companies listed in the Brazilian capital market. Methodology: The sample used in this study is composed of 207companies listed in B3 in the observation period 2012-2021 totaling 2070 observations. The approach is quantitative, using multiple linear regression with balanced panel data. Dechow, Hutton, Kim and Sloan (2012) and Kothari, Leone and Wasley (2005) models were used to improve the discretionary accruals and an earnings management model with control and interest variables. Results: The results did not confirm the hypothesis that the adoption of CPC 47 affected the level of results management in the analyzed period but showed that indebtedness and operating recognition. This evidence about earnings management increased with the adoption of CPC 47 was contrary to Baldissera, Gomes, Zanchet and Fiirst (2018), however, according to the findings of Grecco (2013), Jewel and Nakao (2014) and Braga (2020) in relation to the effects of accounting standards. The results indicate that companies with higher operating cash flow can generate accounting information with better quality regardless of the effects of the adoption of CPC 47. The period of the coronavirus pandemic did not significantly affect earnings management levels. Contributions of the Study: As a contribution, the study expands the theoretical knowledge about the effects of CPC 47 on earnings management. Additionally, in a practical way, it collaborates with regulatory organs, auditors, executives, stakeholders and the financial market in general. [ABSTRACT FROM AUTHOR]

Purpose: The article aims to identify financial and governance factors that can influence the level of disclosure of intangible assets of companies listed on the IBrX-50. Methodology: The study is descriptive, documentary and quantitative, with a sample of 40 companies listed on the Brazilian capital market, totaling 200 observations. The analysis was initially based on the financial statements and explanatory notes released by the companies. To analyze the data, we used multiple linear regression, with SPSS software version 25, relating the factor size, big four audit, profitability, indebtedness, level of corporate governance and internationality with the disclosure index of intangible assets. Results: The results show that from the analyzed factors, only the variables related to size and big four auditing have a significant relationship with the disclosure index of intangible assets. Contributions of the Study: The study contributes by presenting marginal results on evidence of accounting disclosure in the Brazilian capital market, and thus collaborating with the disclosure literature, providing clarity and support for the usefulness of accounting information. In the practical field, it contributes to a better perception of users about the information contained in the financial statements. [ABSTRACT FROM AUTHOR]

The paper contains a critical analysis of the new system of own resources of the European Union, established to address the consequences of the COVID-19 crisis. Analysis is mainly from the perspective of the balanced budget rule. Under Council Decision 2020/2053 of 14 December 2020, the Commission is to be, inter alia, empowered to borrow an unprecedentedly huge amount of funds on capital markets on behalf of the EU. This means that, for the first time in history, common budgetary commitments on the part of the EU will be on such a scale that repayment will be spread over many years and will be charged to future generations of EU citizens (known as the 'Next Generation EU' programme). The research aims to compare these innovations with the long-term financial policy of the EU, as a result of the provisions of the Treaty on the Functioning of the European Union and the Fiscal Compact. It also elaborates on the limits of societal debt issued by their representatives who form public authorities. [ABSTRACT FROM AUTHOR]

Aim/Purpose This study aims to examine the ten factors from the Technology Acceptance Model (TAM), Theory of Planned Behavior (TPB), and Unified Theory of Acceptance and Use of Technology (UTAUT) theories in order to analyze behavioral intentions to use the Indonesian online capital market investment platforms and the effect of behavioral intentions on actual usage. Background The potential growth of capital market investors in Indonesia is large, and the low use of the Internet for investment purposes makes it necessary for stakeholders to understand the factors that affect people's intentions to invest, especially through online platforms. Several previous studies have explained the intention to use online investment platforms using the TAM and TPB theories. This study tries to combine TAM, TPB, and UTAUT theories in analyzing behavioral intentions to use an online capital market investment platform in Indonesia. Methodology The research approach employed is a mixed method, particularly explanatory research, which employs quantitative methods first, followed by qualitative methods. Data were collected by conducting interviews and sending online surveys. This study was successful in collecting information on the users of online capital market investment platforms in Indonesia from 1074 respondents, which was then processed and analyzed using Covariance-Based Structural Equation Modeling (CB-SEM) with the IBM AMOS 26.0 application. Contribution This study complements earlier theories like TAM, TPB, and UTAUT by looking at the intention to use online capital market investment platforms from technological, human, and environmental viewpoints. This study looks at the intention to use the online capital market investing platform as a whole rather than separately depending on investment instruments. This study also assists practitioners including regulators, the government, developers, and investors by offering knowledge of the phenomena and factors that can increase the capital market's investment intention in Indonesia. Findings Attitudes, perceived ease of use, perceived behavioral control, subjective norm, and national pride were found to be significant predictors of the intention to use online investment platforms in Indonesia, whereas perceived usefulness, perceived risk, perceived trust, perceived privacy, and price value were not. Recommendations for Practitioners All practitioners must be able to take steps and strategies that focus on factors that have a significant impact on increasing usage intentions. The government can enact legislation that emphasizes the simplicity and convenience of investment, as well as launch campaigns that encourage people to participate in economic recovery by investing in the capital market. Meanwhile, the developers are concentrating on facilitating the flow of investment transactions through the platform, increasing education and awareness of the benefits of investing in the capital market, and providing content that raises awareness that investing in the capital market can help to restore the national economy. Recommendations for Researchers Further research is intended to include other variables such as perceived benefits and perceived security, as well as other frameworks such as TRA, to better explain individuals' behavioral intentions to use online capital investment platforms. Impact on Society This study can help all stakeholders understand what factors can increase Indonesians' interest in investing in the capital market, particularly through online investment platforms. This understanding is expected to increase the number of capital market participants and, as a result, have an impact on economic recovery following the COVID-19 pandemic. Future Research Future research is expected to investigate additional factors that can influence individuals' behavioral intention to use an online capital market investment platform, such as perceived benefits and perceived security, as well as the addition of control variables such as age, gender, education, and income. International research across nations is also required to build a larger sample size in order to examine the behavior of investors in developing and developed countries and acquire a more thorough understanding of the online capital market investment platform. [ABSTRACT FROM AUTHOR]

Based on the resource allocation optimization theory, from the perspective of internal control (IC) and financial mismatch jointly affecting technological innovation, this study selects the listed enterprises in China's capital market from 2012 to 2020 as the sample, and explores the mechanism among IC, financial mismatch and technological innovation. The results show that effective IC significantly promotes corporate innovation, and mitigates financial mismatch. The mitigation of financial mismatch presents a significant mediating effect between effective IC and innovation output. In Discussion, this study finds that the effects are significantly reflected in non-state-owned enterprises, but not in state-owned enterprises. Finally, it is suggested to improve IC effectiveness continuously, to stimulate innovation vitality, optimize financial resources allocation, and foster new momentum for economic development. And it is suggested to facilitate the transmission effect that effective IC mitigates financial mismatch, and enhances innovation output. Also, the innovation activities in state-owned and non-state-owned enterprises should be coordinated to promote the steady and healthy development of the economy. [ABSTRACT FROM AUTHOR]

This study aims to determine the performance of daily transactions in the Indonesia Stock Exchange during the COVID-19 pandemic against those in other ASEAN countries such as Singapore, Thailand and the Philippines. This research is conducted against the background of the COVID-19 global pandemic that has affected stock exchanges across all countries in the world. The results of this research confirm those of several other studies that state that the COVID-19 pandemic has reduced the performance of stock exchanges in several countries in the world. The research method used in this study involves a descriptive quantitative approach with a random sampling technique on four stock exchanges from four ASEAN countries, namely Indonesia, Singapore, Thailand and the Philippines, with 2017–2020 as the observation period. The results showed that at the beginning of the COVID-19 pandemic, the four countries responded positively to the impact of COVID-19, which resulted in a decrease in the value of daily transactions. However, not long after Q2, all exchanges slowly experienced a recovery, and even the Indonesia Stock Exchange recorded the highest growth in transaction value in the last 20 years. [ABSTRACT FROM AUTHOR]

While prior research shows that pharmaceutical innovation generates measurable benefits for society, over the last 70 years, the innovative activities of pharmaceutical firms have dramatically declined. In this study, we develop and test the hypothesis that to innovate, pharmaceutical firms must have access to capital through well-developed financial markets. Using a broad cross-country sample from 1989 to 2016, we document that financial market development is associated with greater levels of pharmaceutical innovation. To draw stronger causal inferences, and to overcome potential endogeneity issues, we use both instrumental variable and difference-in-difference analysis. Our results suggest that access to capital markets plays a vital role in pharmaceutical innovation. [ABSTRACT FROM AUTHOR]

Research in the field of Islamic finance has increased significantly in the last 6 years. Between 1982 and 2021, 1055 research papers were published in high-quality journals while 30% of them have at least three citations per year on average and 84% of them have been published in the last six years. This study examines 262 research articles that have been identified as effective and current publications in the field of Islamic finance in journals belonging to the SSCI index. It also reveals the institutions and researchers that direct the studies in the field of Islamic finance. Finally, this study identifies the problems and gaps in the literature and offers suggestions for future studies. [ABSTRACT FROM AUTHOR]

Purpose – This research study aims to design a novel risk-managed time-series momentum approach. The present study also examines the time-series momentum effect in the Indian equity market. Apart from this, the study also proposes a novel risk-managed time-series momentum approach. Design/methodology/approach – The study considers the adjusted monthly closing prices of the stocks listed on the Bombay Stock Exchange from January 1996 to December 2020 to formulate long-short portfolios. Newey–West t statistics were used to test the significance of momentum returns. The present research has considered standard risk factors, i.e. market, size and value, to evaluate the risk-adjusted performance of timeseries momentum portfolios. Findings – The present research reports a substantial absolute momentum effect in the Indian equity market. However, absolute momentum strategies are exposed to occasional severe losses. The proposed time-series momentum approach not only yields 2.5 times higher return than the standard time-series momentum approach but also causes substantial enhancement in downside risks and higher-order moments. Practical implications – The study’s outcomes offer valuable insights for professional investors, capital market regulators and asset management companies. Originality/value – This study is one of the pioneers attempting to test the time-series momentum effect in emerging economies. Besides, current research contributes to the escalating literature on risk-managed momentum by suggesting a novel revised time-series momentum approach. [ABSTRACT FROM AUTHOR]