CAPITAL INFLOWS, HOUSEHOLD DEBT AND THE BOOM BUST CYCLE IN ESTONIA

From 2000 to 2007, Estonia was one of the fastest growing emerging market economies. A housing boom, fuelled by capital inflows and credit, resulted in skyrocketing house prices and an over-expanded construction sector. However, the currency board limited the Bank of Estonia’s ability to curb credit growth, while the fiscal policy framework amplified the cycle through pro-cyclical spending increases and tax cuts. As credit was mostly financed by cross-border loans from foreign banks, the risks of disruptions to credit flows and financial contagion have increased. Some have already materialised through tightened lending standards and capital outflows. Estonia is now in a severe recession. To restore high and sustainable growth, the country will need to rebalance its resources from non-tradables towards exports. Regaining external competitiveness will be challenging, however, given the fixed exchange rate and recent devaluations in partner countries. Flexibility of the economy will thus be crucial. Over the medium term, policymakers could also strengthen incentives for a better functioning of the housing finance market and gradually remove the pro-cyclical bias of fiscal policy.capital inflows; credit; household debt; boom-bust cycle; Estonia

Discrete Dipole Approximation for Thermal Radiation in Porous Media

Porous structures, such as foams make excellent thermal insulators. This happens because thermal transfer by conduction is hindered by the voids in the material. However, heat can still radiate through the material or just past the voids. Due to Stefan-Boltzmann law, heat transfer by radiation can be especially significant for large temperatures, and it follows that thermal transfer models that account for radiation may be necessary in some cases. Several existing models for radiative thermal transfer in porous materials, such as continuum models and Monte Carlo, have been used in the past. What many of these models tend to have in common, is that they are highly specific to the systems they were originally made for and require some rather limiting approximations. A more general method which would only require knowing the material and the geometry of the system would be useful. One candidate for such a method, discrete dipole approximation for periodic structures, was tested. In the discrete dipole approximation a structure is discretized into a collection of polarizable points, or dipoles and an incoming electromagnetic planewave is set to polarize it. This has the benefits that it accurately takes into account the target geometry and possible near field effects. It was found that this method is limited for high wavelength, by computation time and for small wavelengths by errors. The cause of the errors for small wavelengths was not entirely caused by the discretization and remains not fully understood

Do green bonds impact on stock values? : Evidence from emerging markets

Green bonds are a relatively new financial instrument in the financial markets, as the first green bond was only issued in 2007. Green bonds are structurally similar to conventional bonds, but their proceeds are used for environmentally friendly projects such as renewable energy projects. The purpose of this work is to examine the impact of the announcement of the green bond on the share price of publicly listed non-financial issuers, by using 155 bond issuance announcements from 66 different companies. This study focuses on companies who operate in emerging countries and have issued green bonds between 2015 and 2021. Issuances used in the work are from organisations operating in Brazil, Chile, China, India, Lithuania, Mexico, South Korea, Taiwan, Thailand or Turkey. This study uses the event study methodology to determine the cumulative abnormal returns, which have also been identified in previous academic studies investigating the impact of green bond issuance on the stock price. The previous research show that the stock markets have both positive and negative reactions when a company announces the issuance. As there has been no previous research specifically focused on emerging countries, this study focuses on them. By focusing solely on emerging green bond markets that has been largely unexplored, this thesis aims to fill the research gap in the literature that has primarily focused on global markets. The research hypotheses of this thesis focus on determining and evaluating the impacts of the announcement on the stock price. The results of the event studies show that the green bonds have a significant negative effect on the company's stock price during the event windows of [-10,10] and [-1,1]. The negative result is partly explained by the fact that the market reactions to conventional bonds have also been shown to be negative in previous academic studies. The greenwashing, novelty value and cost of the green bonds are also possible reasons for the negative reaction. The statistical significance of the results is evaluated using the non-parametric Wilcoxon signed-rank test. The other event windows of [-5,5] and [0,1] are not statistically significant according to the test performed. An OLS regression analysis is also performed for statistically significant event windows, which indicates that there are statistically significant variables for the parameters related to the green bonds and the parameters related to the characteristics of the issuers.Vihreät joukkovelkakirjalainat ovat verrattain uusi rahoitusväline rahoitusmarkkinoilla, sillä ensimmäinen vihreä joukkovelkakirja laskettiin liikkeelle vasta vuonna 2007. Vihreät joukkovelkakirjalainat ovat rakenteellisesti samanlaisia kuin perinteiset joukkovelkakirjalainat, mutta niiden tuotto käytetään ympäristön kestävyyttä edistäviin hankkeisiin, kuten uusiutuvaan energiaan. Tämän työn tarkoituksena on tutkia, miten vihreiden joukkolainojen ilmoitukset vaikuttavat julkisesti listattujen, ei rahoitusalalla toimivien yhtiöiden osakekurssiin käyttäen 155 joukkovelkakirjan liikkeellelaskuilmoitusta 66 eri yritykseltä. Tämä tutkimus keskittyy yrityksiin, jotka toimivat kehittyvissä valtioissa ja ovat laskeneet liikkeelle vihreitä joukkovelkakirjalainoja vuosina 2015–2021. Työssä käytetyt liikkeellelaskut ovat yrityksiltä, jotka operoivat Brasiliassa, Chilessä, Kiinassa, Intiassa, Liettuassa, Meksikossa, Etelä-Koreassa, Taiwanissa, Thaimaassa ja Turkissa. Työssä käytetään tapahtumatutkimusmenetelmää määrittämään kumulatiiviset epänormaalit tuotot, joita myös aiemmat akateemiset tutkimukset ovat määrittäneet tutkiessaan vihreiden joukkovelkakirjalainojen vaikutusta liikkeellelaskijan osakkeen arvoon. Aiemmat tutkimukset osoittavat, että osakemarkkinoilla on sekä positiivisia että negatiivisia reaktioita, kun yritys julkistaa liikkeellelaskevansa vihreän joukkovelkakirjalainan. Koska aiempaa tutkimusta ei ole tehty vain kehittyvien maiden osalta, tämä tutkimus keskittyy erityisesti vain niihin. Tämän työn tavoitteena on siis täyttää aiemman kirjallisuuden aukko, joka on keskittynyt ensisijaisesti globaaleihin vihreiden joukkolainojen markkinoihin. Tutkimuksen pääolettamana on, että vihreät joukkovelkakirjalainat aiheuttavat muutoksen osakkeen arvossa. Tapahtumatutkimuksen tulokset osoittavat, että vihreällä joukkovelkakirjalainalla on merkittävä negatiivinen vaikutus yhtiön osakkeen hintaan [-10,10] ja [-1,1] tapahtumaikkunoiden aikana. Negatiivinen tulos selittyy osittain sillä, että myös perinteisten joukkolainojen markkinareaktio on aiemmissa tutkimuksissa osoitettu negatiiviseksi. Viherpesu, uutuusarvo ja vihreiden obligaatioiden kustannukset ovat myös mahdollisia syitä negatiiviseen reaktioon. Tulosten merkittävyys arvioidaan ei-parametrisen Wilcoxonin signed-rank-testin avulla. Muut työssä käytetyt aikaikkunat [-5,5] ja [0,1] eivät ole Wilcoxonin signed-rank-testin mukaan tilastollisesti merkittäviä. Tilastollisesti merkittäville tapahtumaikkunoille suoritetaan myös OLS-regressioanalyysi, jonka mukaan tilastollisesti merkittäviä muuttujia löytyy sekä erityisesti vihreään velkakirjaan liittyvistä muuttujista sekä liikkeellelaskijan ominaisuuksiin liittyvistä muuttujista

Reorientation and Solvation Dynamics of Bulk and Confined Alcohols

Reorientation and solvation dynamics play a central role in chemistry in the liquid phase. In this work, molecular dynamics simulations are used to study hydroxyl group reorientation dynamics for a series of neat linear alcohols. The recently developed extended jump model satisfactorily explains reorientational slowing with increasing chain length for the water/methanol/ethanol series. The analysis indicates that hydrogen bond strength and exchange geometries are similar across the series, and that the dynamic retardation originates with decreased hydrogen bond exchange due to the increased excluded volume associated with longer alkyl chains. The reorientation of intact hydrogen bonds is thus the dominant reorientation pathway in lower alcohols, while hydrogen bond exchange is dominant in water. Simulation data for higher alcohols show emergent timescales and increased ordering in the liquid, which can also be interpreted within the extended jump model. While new barriers, which are the origin of the additional timescales, appear in free energy profiles for reorientation, solvent viscosity must also be considered. Ethanol and a Stockmayer model solute were confined within a roughly cylindrical silica pore to investigate the effect of confinement on solvation dynamics. The results of solute free energy calculations along a one-dimensional cut through the pore indicate that the charge distribution of the solute controls its location within the pore. Furthermore, the fluorescence energy is a function of solute position in a hydrophilic (but not hydrophobic) pore. These effects originate from silica surface roughness and chemistry, which also strongly alter solvent behavior in the pore. The results indicate that solute motion contributes to the time-dependent fluorescence (TDF) spectrum, but the extent to which this can be observed is still under investigation. A comparison of TDF spectra and other solute properties in the pore for the Stockmayer solute and coumarin 153 dye model indicate that identifying how specific solute and silica properties combine to change spectral properties will require systematic testing of a series of dye and confinement models