Risk Transmissions between Bitcoin and Traditional Financial Assets during the COVID-19 Era: The Role of Global Uncertainties

This paper examines return and volatility connectedness between Bitcoin, traditional financial assets (Crude Oil, Gold, Stocks, Bonds, and the United States Dollar-USD), and major global uncertainty measures (the Economic Policy Uncertainty-EPU, the Twitter-based Economic Uncertainty-TEU, and the Volatility Index-VIX) from April 29, 2013, to June 30, 2020. To this end, the Time-Varying Parameter Vector Autoregression (TVP-VAR) model, dynamic connectedness approaches, and network analyses are used. The results indicate that total spillover indices reached unprecedented levels during COVID-19 and have remained high since then. The evidence also confirms the high return and volatility spillovers across markets during the COVID-19 era. Regarding the return spillovers, Gold is the centre of the system and demonstrates the safe heaven properties. Bitcoin is a net transmitter of volatility spillovers to other markets, particularly during the COVID-19 period. Furthermore, the causality-in-variance Lagrange Multiplier (LM) and the Fourier LM tests' results confirm a unidirectional volatility transmission from Bitcoin to Gold, Stocks, Bonds, the VIX and Crude Oil. Interestingly the EPU is the only global factor that causes higher volatility in Bitcoin. Several potential implications of the results are also discussed

The Impact of Geopolitical Risks on Tourism Supply in Developing Economies: The Moderating Role of Social Globalization

Capital investment is vital for sustainable tourism growth, particularly in times of geopolitical turmoil. This study examines how tourism investment was influenced by geopolitical risks considering social globalization as a moderating factor. Data were collected from 18 developing economies between 1995 and 2018. The results from the fixed effects and the least squares dummy variable–corrected methods show that the geopolitical risks negatively affect capital investment in tourism, with social globalization playing a moderating role in alleviating the adverse effect. The results were robust to different measures and analyses. The study advances our understanding of sustainable tourism growth amid geopolitical turmoil. Policymakers, especially those from developing economies, are suggested to be vigilant about the media atmosphere of geopolitics and enhancing social globalization as a countermeasure against politically turbulent times. The study also provides implications for alleviating the impact of the global pandemic on tourism investment

How does digital finance affect industrial structure upgrading? Evidence from Chinese prefecture-level cities

YesDigital finance is playing an increasingly prominent role in economic development. This paper examines the impact of digital finance on industrial structure upgrading based on panel data from 289 Chinese prefecture-level cities from 2011 to 2020. The paper adopts fixed effects, mediating effects, and spatial econometric models and the findings are as follows. First, digital finance development significantly boosts industrial structure upgrading in Chinese cities. The evidence remains valid after various robustness tests. Second, digital finance and industrial structure upgrading exhibit positive spatial spillover effects. Third, digital finance indirectly affects industrial structure upgrading through innovation, entrepreneurship and the structure of household consumption channels. Fourth, the influence of digital finance is more significant in cities with more developed economies, less financialization and lower income inequality. Finally, among the sub-indicators of digital finance, the breadth of coverage plays the most significant role, inspiring policymakers and financial institutions to speed up the digitization infrastructure in backward areas.This work was supported by the Natural Science Fund of Hunan Province (2022JJ40647)

Introducing a new measure of energy transition: Green quality of energy mix and its impact on CO2 emissions

YesThis paper introduces a novel measure of the energy transition, i.e., the green quality of energy mix (GREENQ) across the Organisation for Economic Co-operation and Development (OECD) countries. Then, the paper examines the impact of the GREENQ on CO2 emissions in the panel dataset of 36 OECD countries from 1970 to 2021. The explanatory variables include per capita income, institutional quality and technology. Long-run panel data estimations indicate that per capita income, institutional quality and technology increase CO2 emissions. The novel evidence is that the GREENQ is negatively related to the level of CO2 emissions. These findings are robust to employ different panel data estimation techniques. Potential policy implications are also discussed.The project was funded by the “Foreign Cultural and Educational Experts Project of the Ministry of Science and Technology of China” (Project Number: DL2022180001L)

Do oil market shocks affect financial distress? Evidence from firm-level global data

This study investigates the impact of three oil price shocks on financial distress of global firms using a dataset of 8130 firms across 48 countries from 2002 to 2022. It also analyses the role of energy diversification in the relationship between oil shocks and firm distress. The findings reveal that aggregate demand and specific demand shocks increase firm distress risk, while supply shocks reduce it. Furthermore, the results suggest that energy diversification mitigates the impact of specific demand shocks on firm distress. The study also implements several robustness checks, and the results remain consistent. Potential policy implications are also discussed

Causality and Dynamic Spillovers among Cryptocurrencies and Currency Markets

This paper utilizes two methods to uncover the causality dynamic between the three leading cryptocurrencies: Bitcoin, Litecoin, Ripple, and nine major foreign currency markets. Firstly, we implement the technique of Diebold–Yilmaz to compute the spillover index between cryptocurrencies and currency markets. We find a significant return spillover effect between Bitcoin and Litecoin in the first three quarters of 2017. Still, the return spillover is merely meaningful in the first three quarters of 2015 for Ripple. However, the total volatility spillover index in the system decreases in the fourth quarter of 2017. Secondly, we apply the Bayesian graphical structural vector, autoregressive estimations, and find that the current level of Bitcoin depends only on the previous level of the Chinese Yuan. The current level of Ripple strongly depends on the prior levels of Bitcoin, followed by Litecoin. The current level of Litecoin strongly depends on the previous level of Ripple, followed by the Chinese Yuan. These results indicate that there is a significant causal relationship among cryptocurrencies. However, except for the Chinese Yuan, major traditional currencies do not significantly affect cryptocurrencies

The effectiveness of the legal system and inbound tourism

This paper investigates the impacts of the effectiveness of the legal system and protection of the property rights on tourism development using a panel data of 152 countries over the period 1995–2015. The paper considers the fixed-effects, Hausman–Taylor (HT), and system generalized method of moments (GMM) estimations and the results demonstrate that a higher level of legal system quality and better protection of property rights promote inbound tourism. Specifically, the results show that higher judicial independence and better enforcement of contracts enhance the development of tourism. The benchmark results are robust to focus on the different groups of countries and measures for tourism development as well as to exclude the outlier observations