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Macroeconomic Uncertainty (macroeconomic + uncertainty)
Selected AbstractsMACROECONOMIC UNCERTAINTY AND MACROECONOMIC PERFORMANCE: ARE THEY RELATED?THE MANCHESTER SCHOOL, Issue 2005DON BREDIN We use a very general bivariate generalized autoregressive conditional heteroskedasticity-in-mean model and G7 monthly data covering the 1957,2003 period to test for the impact of real and nominal macroeconomic uncertainty on inflation and output growth. Our evidence supports a number of important conclusions. First, in most countries output growth uncertainty is a positive determinant of the output growth rate. Second, there is mixed evidence regarding the effect of inflation uncertainty on inflation and output growth. Hence, contrary to popular belief, uncertainty about the inflation rate is not necessarily detrimental to economic growth but in some cases it may also enhance growth. Finally, there is mixed evidence on the effect of output uncertainty on inflation. In sum, our results indicate that macroeconomic uncertainty may even improve macroeconomic performance. [source] THE EFFECTS OF UNCERTAINTY ON THE LEVERAGE OF NONFINANCIAL FIRMSECONOMIC INQUIRY, Issue 2 2009CHRISTOPHER F. BAUM This paper investigates the link between the optimal level of nonfinancial firms' short-term leverage and macroeconomic and idiosyncratic sources of uncertainty. We develop a structural model of a firm's value maximization problem that predicts a negative relationship between uncertainty and optimal levels of borrowing. This proposition is tested using a panel of nonfinancial U.S. firms drawn from the COMPUSTAT quarterly database covering the period 1993,2003. The estimates confirm that as either form of uncertainty increases, firms decrease their levels of short-term leverage. This effect is stronger for macroeconomic uncertainty than for idiosyncratic uncertainty. (JEL C23, D8, D92, G32) [source] The impact of macroeconomic uncertainty on firms' changes in financial leverageINTERNATIONAL JOURNAL OF FINANCE & ECONOMICS, Issue 1 2010Christopher F. Baum Abstract We investigate the relationship between a firm's measures of corporate governance, macroeconomic uncertainty and changes in leverage. Recent research highlights the role of governance in financing decisions. Previous research also indicates that macroeconomic uncertainty affects a firm's ability to borrow. In this paper we investigate how both these channels of influence affects firms' financing decisions. Our findings show that macroeconomic uncertainty has an important role to play, both by itself and in interaction with a measure of corporate governance. Copyright © 2009 John Wiley & Sons, Ltd. [source] Loan Loss Provisions by Banks in Hong Kong, Malaysia and SingaporeJOURNAL OF INTERNATIONAL FINANCIAL MANAGEMENT & ACCOUNTING, Issue 1 2007Li Li Eng This paper studies loan loss disclosures by banks in Hong Kong, Malaysia, and Singapore for the period 1993 through 2000. We find that unexpected loan loss provisions are positively related to bank stock returns and future cash flows. This indicates that Asian bank managers increase loan loss provisions to signal favorable cash flow prospects, and bank investors bid bank stock prices up when unexpected provisions are positive. These results are consistent with those obtained by Wahlen (1994) for US banks. We also examine the impact of the Asian financial crisis of 1997 on the loan loss variables. The results indicate that the association between the unexpected loan loss provisions and bank stock returns and future cash flows was significantly lower in the crisis years, relative to the non-crisis period. Evidently, discretionary loan loss provisions had no signaling value during the crisis. This suggests that macroeconomic uncertainty influenced the strategic behavior of Asian bank managers and investors. [source] MACROECONOMIC UNCERTAINTY AND MACROECONOMIC PERFORMANCE: ARE THEY RELATED?THE MANCHESTER SCHOOL, Issue 2005DON BREDIN We use a very general bivariate generalized autoregressive conditional heteroskedasticity-in-mean model and G7 monthly data covering the 1957,2003 period to test for the impact of real and nominal macroeconomic uncertainty on inflation and output growth. Our evidence supports a number of important conclusions. First, in most countries output growth uncertainty is a positive determinant of the output growth rate. Second, there is mixed evidence regarding the effect of inflation uncertainty on inflation and output growth. Hence, contrary to popular belief, uncertainty about the inflation rate is not necessarily detrimental to economic growth but in some cases it may also enhance growth. Finally, there is mixed evidence on the effect of output uncertainty on inflation. In sum, our results indicate that macroeconomic uncertainty may even improve macroeconomic performance. [source] | ||||||||||