This article examines the degree of financial integration among the equity markets of Brazil, Russia, India, China, and South Africa (BRICS) by using monthly data collected for the period 2005–2014. The study employs Johansen cointegration test, vector error correction model (VECM), and Granger causality test which confirm the existence of relationship in the short and long run among the equity markets of BRICS. Further results exhibit that there exists cointegration or a long-run relationship among the equity markets, but weak cointegration, though the results of Granger causality test do not display existence of any causality among market pairs such as China–Brazil, Russia–Brazil, South Africa–Brazil, Russia–China, and South Africa–India. The results indicate that even though the financial integration among the equity markets of BRICS is on ascendance, it is yet incomplete. This work suggests harmonization of laws, regulations, and operations based on international principles and appropriate regulatory supervision among BRICS nations in order to minimize the risk of financial integration, besides further relaxing restrictions on capital account for expedited financial integration.
This article examines the degree of integration among the financial markets in South Asia at regional and extra-regional levels by using monthly data collected for the period 2010–2018. It uses autoregressive distributed lag (ARDL) bounds test approach of cointegration, and short-run causalities are obtained under the error correction framework. The bounds testing procedure finds the existence of long-run relations among the four markets when the equity market of India is taken as the dependent variable. Although the bounds testing procedure finds some evidence of integration at the regional level, evidence suggests that integration at the global level is much higher than the integration at the regional level for this region. Another interesting finding is that Pakistan does not exhibit cointegrating relations with the rest of the equity markets in South Asia, and results are inconclusive when developed countries’ equity markets are introduced to the estimated models, which can be attributed to the political instability that Pakistan is consistently plagued with and also its strained relationship with India, thereby hampering capital inflows.
Based upon a sample of 78 firms operating in Indian automotive component industry for the period 2000–2018, this research empirically examines the role of business-group affiliation, overseas investment and technology in determining exports. It applies panel Tobit and Probit model estimated with the maximum likelihood estimator. This research finds that technology imports, firm’s age, overseas investment and affiliation to a business group significantly affect industry’s export performance. However, some variables, such as past R&D intensity, firm’s size and companies with overseas investment and being part of a group have been found to have had a detrimental effect. All these results show that being outward-oriented in terms of overseas investment and being affiliated with a business group makes a significant difference concerning export success.
Based upon the dataset drawn from Centre for Monitoring of Indian Economy (CMIE) Prowess database, World Bank and Annual Survey of Industries (ASI) for a period 2000–2015, this article tests the persistence of profitability and checks the validity of Resource-Based View (RBV) in elucidating the variations in profitability on an industry-specific setting that is, Indian automotive components industry under a Generalized Method of Moments (GMM) framework. The article finds that the persistence of profits is positive and moderate, indicating that the industry is reasonably competitive. The results further suggest that the past R&D intensity, export intensity, size, labour productivity growth, and GDP growth have a positive bearing on the current profitability, while current R&D intensity, A&M intensity, capital intensity, firm leverage and output of OEMs were found to have exercised negative effect. Since past R&D intensity is found to be positively influencing the current profitability, this article infers that RBV holds for this industry.
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