Simplice A, Asongu (2011): Political crises and risk of financial contagion in developing countries: Evidence from Africa. Published in: Journal of Economics and International Finance , Vol. 3, No. 7 (1. July 2011): pp. 462-467.
Download (130kB) | Preview
The recent waves of political crises in Africa and the Middle East have inspired the debate over how political instability could pose a risk of financial contagion to emerging countries. With retrospect to the Kenyan political crisis, our findings suggest stock markets in Lebanon, Mauritius were contaminated while Nigeria experienced a positive spillover. Our results have two major implications. Firstly, we have confirmed existing consensus that African financial markets are increasingly integrated. Secondly, we have also shown that international financial market transmissions not only occur during financial crisis; political crises effects should not be undermined.
|Item Type:||MPRA Paper|
|Original Title:||Political crises and risk of financial contagion in developing countries: Evidence from Africa|
|Keywords:||Political crisis, contagion, developing countries, equity markets|
|Subjects:||O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies > O55 - Africa
F - International Economics > F5 - International Relations, National Security, and International Political Economy > F50 - General
F - International Economics > F3 - International Finance > F30 - General
G - Financial Economics > G1 - General Financial Markets > G15 - International Financial Markets
G - Financial Economics > G1 - General Financial Markets > G10 - General
|Depositing User:||Simplice Anutechia Asongu|
|Date Deposited:||19. Mar 2012 23:06|
|Last Modified:||19. Feb 2013 02:12|
Asongu. S. A., (2011). “Globalization, financial crisis and contagion: time-dynamic evidence from financial markets of developing countries”, MPRA Paper 30120.
Calvo, G.A., Leiderman, L., & Reinhart, C.A.,(1996, Spring). “Inflows of capital to developing countries in the 1990s”, Journal of Economic Perspectives, 10, pp.123-139.
Collins. D., & Biekpe, N., (2003). “Contagion: a fear for African equity markets?” Journal of Economics and Business, 55, pp. 285-297.
Forbes, K. J., (2000). “The Asian flu and Russian virus: firm-level evidence on how crises are transmitted internationally”, NBER Working Paper 7807.
Forbes, K., Rigobon, R., (2002, October). No contagion, only interdependence: measuring stock market co-movements, Journal of Finance. 57(5), pp 2223–2261.
Frankel, J. & Rose, A.K., (1996, November). “Currency crashes in emerging markets: An empirical treatment”. Journal of International Economics, 41, pp. 351-366.
Kanas, A., (1998). “Linkages between the US and European equity markets: further evidence from cointegration test”. Applied Financial Economics, 8 (6),pp. 607–614.
King, M., Sentana, E., Wadhwani, S., (1994). “Volatility and links between national stock markets”. Econometrica, 62 (4), pp.901–933.
King, M., & Wadhwani, S., (1990). “Transmission of volatility between stock markets”, Review of Financial Studies, 3(1), pp.5–33.
Lee. H., Wu. H. & Wang. Y., (2007). “Contagion effect in financial markets after the South-East Asia Tsunami”, Research in International Business and Finance, 21, pp.281-296.
Obstfeld, M., (1986, March). “Rational and self-fulfilling balance of payments crises”. American Economic Review, 76, pp.72–81.
Schmukler, S.L.,(2004, April). “Financial Globalization: gain and pain for developing countries”. Federal Reserve Bank of Atlanta Economic Review, pp.39-66.