This study investigates the volatility and external shock persistence within the financial and alternative assets markets during times of crises triggered by Covid-19 and the war in Ukraine. Univariate GARCH family models are used to capture the effect of financial turmoil caused by recent crises. Five different class of assets (which includes Islamic, ESG, Conventional, Crypto, FinTech, and commodities) have been chosen to represent a sample of the worldwide traditional financial market and alternative assets. The findings of this study revealed that almost all financial and alternative assets experienced an increase in volatility, except Bitcoin, across all observation periods. Islamic stock and ESG indexes exhibited high volatility before the Covid-19 outbreak. During the pandemic, all assets became more volatile. In addition, Islamic equities and ESG indexes showed relatively lower risk compared to conventional stocks and other alternative assets during the war. Multiple financial assets tend to be highly volatile during crises; however, global investors need to consider the advantages of incorporating Islamic stocks and ESG indexes as part of their investment portfolio innovation strategy, particularly in the presence of geopolitical risk. 

The Impact of Covid-19 and Russia–Ukraine War on the Financial Asset Volatility: Evidence from Equity, Cryptocurrency and Alternative Assets

This paper examines and confirms the varying volatility of the relationship between cryptocurrency and currency markets at different time periods, such as when the market encountered multiple risk events including the US–China trade war, COVID-19, and the Russian–Ukraine war. We employ the Diagonal BEKK model and find that the co-volatility spillover effects between the returns of cryptocurrencies and currencies, with the exception of Tether and the U.S. dollar index, evolved significantly. Furthermore, the co-volatility spillover effects between cryptocurrencies and EUR have the largest effects and fluctuations. Large-cap cryptocurrencies (Bitcoin and Ethereum) have greater co-volatility spillover effects between them and currencies. Regarding the ability of cryptocurrencies to act as safe-haven for currencies, we observe that Bitcoin, Ethereum, and Tether served as safe-havens during the US–China trade war, and Bitcoin was a safe-haven during COVID-19. During the 2022 Russian–Ukraine war, Bitcoin and Tether were safe-havens. Interestingly, our findings point out that Bitcoin provides a more consistent safe-haven function for currency markets. Overall, by including multiple global risk events and a comprehensive dataset, the results support our conjecture (and earlier studies) indicating that the capabilities of cryptocurrency are time-varying and related to market status and risk events with different natures.

/pdf/investigating-the-co-volatility-spillover-effects-between-3upetppt.pdf

Investigating the Co-Volatility Spillover Effects between Cryptocurrencies and Currencies at Different Natures of Risk Events

Improving The Order Fulfilment Process At A Metalwork Company

Financial markets are frequently exposed to a variety of crises at the national, regional, and global levels, with potentially heterogeneous effects on market performance. To make sound investment and policy choices, investors and policymakers are constantly concerned about the market's behavior during such times of extreme stress. This article explores the impact of the two recent crises—the Russian–Ukraine war and the COVID-19 pandemic—on equity markets using Karavias et al.'s (2022) panel data approach and daily data from January 2020 to April 2022. Unlike conventional panel data models, this novel technique assesses the presence and location of common structural breaks across the studied countries while accommodating unobserved heterogeneity and panel dependency. We hypothesize that the conflict's impact on global equity markets is heterogeneous and based on countries' economic-political connection or proximity to the war zone, notably among sanctioning countries (the G7) and non-sanctioning countries (the Russia-China-India triple or RIC). Our results suggest that the G7's financial markets are more sensitive to country-specific macroeconomic factors and commodity price changes during extreme market stress than those of the RIC triad. Moreover, the war has a stronger influence on the G7 stock markets through commodity prices, with a greater impact of natural gas and wheat prices for this group. These findings are consistent with the fact that markets in developed economies with an extreme reliance on commodities are more sensitive to crises and international conflicts. 

Stock markets from COVID-19 to the Russia–Ukraine crisis: Structural breaks in interactive effects panels

Globalization is a global process with all the speed of change and rapid technological development. The current of globalization brings many positive impacts. All forms of cultural, language and news information can be spread very quickly through offline and online media in the era of globalization. But besides the positive impact, there are also negative impacts. Among them are many generations of people who are influenced by western culture that are not in accordance with national culture, the spread of hoaxes that contain false news, to the occurrence of moral crises. Pancasila character education is an effort to cultivate character based on the practice of the principles of the Pancasila which gives noble values ​​to the attitudes and behavior of each individual. Pancasila as a guideline for Indonesian citizens should be practiced properly in daily life. Millennials live in an era of globalization with the sophistication of digital technology. They are used to all digital convenience access. But it cannot be denied that the moral crisis has hit the millennial generation. This can be seen from the rise of cases of sexual harassment, murder, and theft by students who in fact are millennial generations in universities. The purpose of the research in this article is to analyze the important role of character education based on Pancasila in facing the challenges of globalization towards millennial generations in universities.

Pancasila Character Education for Millennials in Higher Education: The Future Challenges for Indonesia in Global Prespective

Interface between Globalization and Technology

PurposeThis paper documents a robust empirical regularity: higher trade openness is associated with a lower unemployment rate. This paper also examines whether or not the effects of trade liberalisation depend on countries' income levels. Further, the dynamic causation between trade openness and unemployment is also examined.Design/methodology/approachIn order to obtain insight into the openness–unemployment nexus, following empirical methods were utilised - static panel models, dynamic panel models and a novel panel Granger causality approach proposed by Juodis et al. (2021).FindingsResults suggest that openness negatively affects unemployment; the extent to which trade liberalisation affects unemployment depends on the income level of each country. The Juodis, Karavias, and Sarafidis (JKS) test confirmed that the past values of trade openness, inflation, foreign direct investment and gross domestic product per capita contain information that helps to predict unemployment in a more robust manner. To simply put, opening upto trade may eventually become a requirement for creating more job opportunities, but this alone may not be enough. The extent to which nations benefit from trade liberalisation is largely dependent on the overall economic conditions and their capability to move up the income scale.Originality/valueA major difference between this study and those performed previously is that this study does not only examine the impact of trade openness on unemployment, but also investigates whether the unemployment effect of liberalisation is affected by countries' income levels – an issue that has received little attention in the past. Additionally, the unique panel non-causality approach put forth by Juodis et al. (2021) is used in the first instance to look into the causal link between trade openness and unemployment. This method has advantages in that the method enables capturing Granger-causality in homogeneous or heterogeneous panels amongst multiple variables.

Revisiting the trade openness–unemployment nexus: an application of the novel JKS panel causality test with static and dynamic panel models

Purpose This paper aims to investigate the effects of the COVID-19 crisis on trade flows in Asia Pacific countries and explores the causality between COVID-19-related shocks and trade. Design/methodology/approach The authors used two novel techniques, namely, two-stage instrumental-variables (2SIV) approach and Juodis, Karavias and Sarafids (JKS) causality test, to examine trade dynamics in the Asia Pacific region during the pandemic. Findings Using the monthly trade data of 17 Asia Pacific countries between January 2020 and December 2021, the results were threefold. Firstly, the empirical analysis showed that during the COVID-19 crisis, the flow of exports tended to persist idiosyncratically in comparison to the flow of imports. In particular, a specific finding was that the persistence level in exports was about 20%–25% higher than that in imports. Secondly, the authors found that the past values of COVID-19 cases and COVID-19 deaths contain information that helps to predict exports/imports over and above the information contained in the past values of exports/imports alone. Finally, the study established that the government response and stringency indexes have a Granger-causal relationship with exports and imports. Research limitations/implications For the foreseeable future, these findings have significant policy ramifications. Firstly, if a COVID-19 crisis-like situation emerges in the future, it will be critical for countries to maintain their competitiveness throughout the crisis, like the COVID-19 pandemic, while also rebuilding trade relationships wherever possible. Secondly, because information about government responses and measures can also be used to predict future trade flows, prudent management of government responses and stringent measures will be necessary in a crisis like COVID-19 to achieve the optimum level of exports and imports. At the same time, the trading partners should give up the idea of trade protection and focus on finding a way to balance the conflicting needs of imports and exports. Originality/value To the best of the authors’ knowledge, the authors, for the first time, used a 2SIV approach and JKS causality test to examine trade dynamics in the Asia Pacific region during the pandemic. In addition, the authors present the first comprehensive analysis of the evolving relationships between export and import flows and governmental policy responses under COVID-19. As a result, it contributes uniquely to both public and international economics. 

COVID-19 pandemic and trade flows: empirical evidence from selected Asian Pacific countries

Macroeconomic factors such as low inflation, export orientation and low labor taxes help to determine how much employment is created by growth. The relationship between growth and employment is strong and positive which gets enlightened when all macroeconomic policies work in harmony. Indian economy at the time of independence was mainly rural in nature and in a bad state. This was due to the anti-Indian policies of the British Government. The country was engulfed by the vicious circle of poverty and to break this vicious circle Government of India planned in a focused way. The emphasis shifted from agriculture to industry. Also emphasis was laid on increasing role of the state to generate employment and reduce poverty by appropriate macroeconomic policies. However, little was achieved till 1990’s. So the path to long-run economic growth was ensured by introducing New Economic Policy in 1991, which aimed at reducing fiscal deficits, lowering inflation, maintaining exchange rate stability etc. One thing that was obvious was that under New Economic Policy, the public sector will have a diminished role and will be largely limited to social sectors and non-profit making activities unattractive to the private sector. These policy changes affected macroeconomic policies of the government. Despite these policy changes brought under the New Economic Policy, one feature that still remains an important feature of macroeconomic policies in India is that macroeconomic policies still continue to act more as the control devices rather than as development tools. As a result macroeconomic policies fail to generate additional employment. Macroeconomic policies need to be converted into tools for macroeconomic stabilization (Shah, 2008). There are various constraints in macroeconomic policies which refrain them to act as development tools and thereby increase unemployment levels in underdeveloped economies of the world. The present paper attempts to highlight such constraints and suggest remedial measures.

Constraints in Macroeconomic Policies in Raising Employment

This study used the novel cross-sectionally augmented autoregressive distributed lag (CS-ARDL) model and the Juodis–Karavias–Sarafidis (JKS) causality test to investigate the intricate nexus between inflation, shrinkflation, and economic growth in 20 countries from 1990 to 2022. The results validated the detrimental effects of inflation and shrinkflation on economic growth, underlining price stability, and reverse or positive shrinkflation as crucial for sustained expansion. Causality analysis further revealed feedback causality between inflation and economic growth. Finally, our findings solidify the quantity-led growth or value-driven growth hypothesis. Reverse shrinkflation, or growth driven by value, drives economic growth unidirectionally. Consumption expenditure increases as the value or quantity of goods and services increase, which boosts consumption, aggregate demand, and economic growth. Hence, to stimulate sustainable economic growth, policymakers should implement prudent monetary policies to control high inflation, a major contributor to shrinkflation. Additionally, industries should be encouraged to enhance productivity and reduce manufacturing costs without sacrificing product size or quality. Lastly, it is essential to monitor pricing changes in critical industries and intervene if unjustified shrinkflation trends emerge. JEL Classification C13, E31, F43

Shrinking Sizes, Swelling Prices: Evaluating the Ripple Effects of Inflation and Shrinkflation on Economic Growth Using Dynamic Panel Framework

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Papers

Interface between Globalization and Technology

Revisiting the trade openness–unemployment nexus: an application of the novel JKS panel causality test with static and dynamic panel models

COVID-19 pandemic and trade flows: empirical evidence from selected Asian Pacific countries

Constraints in Macroeconomic Policies in Raising Employment

Shrinking Sizes, Swelling Prices: Evaluating the Ripple Effects of Inflation and Shrinkflation on Economic Growth Using Dynamic Panel Framework