Global Economy Journal

This paper re-examines the role of the euro in enhancing the convergence among stock markets of Germany, France and Italy. The VAR-framework is implemented with a dummy variable. A pre- and post-euro analysis is also performed with an exclusion of the dummy variable. Monthly data on stock market returns from February 1994 through December 2007 are employed. The empirical results reveal evidence of significant convergence among the above markets during the post-euro era relative to the pre-euro era with net positive short-run causal effects.

This paper tests the pollution-haven hypothesis. A fixed-effects variation of the gravity model is applied to panel data to investigate what relationship, if any, exists between environmental regulations and FDI. The data set focuses on bilateral flows of aggregated foreign direct investment between 26 OECD countries from 1982 to 1997. Use of pollution emissions as a proxy for environmental stringency shows evidence in support of the pollution-haven hypothesis. In other words, firms do seek out countries with weaker environmental regulations for production. In addition, FDI appears to fall with distance. Contrary to expectations, FDI is not influenced by interest rates, wages or GDP.

A distinctive feature of present globalization is the development of international production sharing activities (i.e. production fragmentation). The recent developments in transportation and communication technologies led to a surge in intermediate goods trade. However, intermediate goods trade is often neglected in the empirical studies of the exchange rate pass-through (ERPT). Using import unit values of 79 motor vehicle products and 245 auto-part products, which are classified by the 10-digit level of Harmonized Tariff Schedule (HTS), this study examines the pass-through of exchange rate changes into the U.S. auto-industry import prices from 5 major trading partners for the period of 1998.01 to 2006.12. Nonstationary panel data estimation techniques and tests for cointegration are employed in this study. Secondly, this study aims to compare the ERPT for the motor vehicle products (final goods) to the ERPT for the auto-parts (intermediate goods) in the U.S. The results suggest that import prices do not respond proportionately to the exchange rates and the estimated pass-through elasticities for motor vehicle products are lower than that for auto-parts.

This brief paper a) focuses on important elements of the November Summit of G-20 Countries that resulted in the Washington Declaration; b) highlights problems with credit rating agencies and financial regulation; c) argues that the IMF is a laggard in being able to coordinate any major efforts to prevent, mitigate, or coordinate global issues; and d) identifies a number of important issues that deserve attention at the next G-20 Summit to be held in London on April 2^nd.

In this article, we provide evidence on the nature and the relative importance of domestic and foreign shocks – with a focus on monetary shocks – in the Slovak economy based on the block-restriction vector autoregression model during the years 1999–2007. We document a well-functioning monetary transmission mechanism in Slovakia. Subject to various sensitivity checks, we find that contractionary monetary policy shock has a temporary negative effect on the degree of economic activity and price level. We find that using output gap instead of GDP alleviates the price puzzle. In general, prices are driven mainly by foreign factors and the European Central Bank monetary policy shock on Slovak prices is more powerful than that of the National Bank of Slovakia. The Slovak Central Bank interest rate policy seems to follow the ECB's interest rates. On the other hand, spectacular Slovak economic growth is primarily driven by domestic factors suggesting the positive role of recently undertaken Slovak economic reforms.

The food price shocks that erupted in 2008 revealed the vulnerability of many developing countries, notably those in Asia, from volatility in the international foodgrain markets. For instance, by March of 2008, the price of traded rice had increased by well over 70 percent compared to year-before levels. Addressed primarily to policymakers in the Asian region, this paper outlines a proposal for a regional risk sharing arrangement—an Asian rice insurance mechanism (ARIM)—which could form part of the region's long-term response to the food security issue. The ARIM could serve as a regional public good by helping countries in the region more efficiently manage the risks related to volatile rice production and trade, arising from emerging structural factors such as the rising and evolving food demand of large Asian countries like China, India and Indonesia, as well as the effects of climate change (and climatic shocks) on the agricultural sector more broadly.

Relatively new in Romania, IT governance is defined as procedures and policies established in order to assure that the IT system of an organization sustains its goals and strategies. This bundle of policies and procedures, following the best practices in the area, intends to guide and control the IT function in order to add value to the organization and to minimize IT risks.

The purpose of the research is to identify the measure in which the IT governance practices are implemented to the level of the financial institutions in Romania. The goal of this paper is a comparative analysis for implementing IT governance using data offered by the IT Governance Institute. This institute makes every year a study (IT Governance Global Status Report – 2006) to determine a sense of priorities and to develop actions for implementing IT governance, using data which acknowledges once more the need for all organizations to have tools and services to assure an efficient IT governance. In this way, the research will analyze, in the field of Romanian financial institutions, the most serious IT problems pointed out by the respondents from the last year, the most efficient measures considered by top management for resolving problems pointed out, the best used practices in IT governance and the most used frameworks for implementing IT governance practices.