Systemic financial risk is one of the most significant collective action problems facing societies. The Great Recession brought attention to a tragedy of the commons in capital markets, in which market participants, from the first-time homebuyer to Wall Street financiers, acted in ways beneficial to themselves individually, but which together caused substantial collective harm. Two kinds of risk are at play in complex chains of transactions in financial markets: ordinary market risk and systemic risk. Two moral questions are relevant in (...) such cases. First, from the standpoint of interactional morality, does a person have a moral duty to avoid risk of harm to others if their financial transactions contribute in some way, however small, to the loss or harm? This article identifies the conditions in which persons are morally responsible in such cases. Second, from the standpoint of institutional morality, how should society distribute the risk of harm associated with massively complex financial markets? This question is considered in the context of the home mortgage credit market. Luck egalitarianism, in particular a Dworkinian insurance scheme to allocate risks and resources relating to mortgage credit and private home ownership, offers substantial promise. (shrink)

This paper argues that some of the major theories in current business ethics fail to provide an adequate account of moral responsibility for the creation of systemic financial risk. Using the trading of credit default swaps during the 2008 financial crisis as a case study, I will formulate three challenges that these theories must address: the problem of risk imposition, the problem of unstructured collective harm and the problem of limited knowledge. These challenges will be used to work out key (...) shortcomings of stakeholder approaches and Integrative Social Contracts Theory. I will argue that pluralist connection models used in political theory can help to overcome these shortcomings. Adopting an approach based on these models shows that financial institutions incur obligations in five main areas: managing their own risk profile; remedying some of the harms caused by financial crises; supporting the development of better epistemic methods; curbing the transmission and amplification of initial losses; and instigating structural reforms. (shrink)

This paper argues that some of the major theories in current business ethics fail to provide an adequate account of moral responsibility for the creation of systemic financial risk. Using the trading of credit default swaps (CDS) during the 2008 financial crisis as a case study, I will formulate three challenges that these theories must address: the problem of risk imposition, the problem of unstructured collective harm and the problem of limited knowledge. These challenges will be used to work out (...) key shortcomings of stakeholder approaches and Integrative Social Contracts Theory. I will argue that pluralist connection models used in political theory can help to overcome these shortcomings. Adopting an approach based on these models shows that financial institutions incur obligations in five main areas: managing their own risk profile; remedying some of the harms caused by financial crises; supporting the development of better epistemic methods; curbing the transmission and amplification of initial losses; and instigating structural reforms. (shrink)

Large changes of financial market prices without exogenous causes deviate significantly from the Gaussian behavior of random variables. This indicates that financial markets should be treated as complex systems, for which nonlinear interactions of its subunits/agents are crucial. I focus on how the complex systems perspective impacts the notion of explanations in economics. The mechanistic model seems to fit the bill, but problems surface on closer scrutiny. One characteristic of complex systems is that their behavior is surprisingly independent from microscopic (...) details. Thus, mechanistic explanations in the microreductionist manner seem unavailable. Despite these conflicts, I defend a modified structural mechanistic approach. (shrink)

Premodern Financial Systems: A Historical Comparative sStudy describes the financial superstructure, such as the method of financing the government, and links it to the essential characteristics of the infrastructure of nearly a dozen societies ranging from Athens in the late fifth century BC to the United Provinces in the mid-seventeenth century. The main features of the financial superstructures discussed are the monetary system, the types of financial instruments and institutions, interest rates, and the methods of financing agriculture, non-agricultural business, households, (...) foreign trade, and government. Aspects of the infrastructures covered include population, urbanization, prices, national output, wealth, and their sectoral and size distribution. (shrink)

The financial system is currently undergoing a revolution brought about by e-finance, digital convergence, new market entrants and government-encouraged competition. New market entrants such as Apple, Alibaba, Facebook and Google come from industries such as IT, retail, social media and telecoms, and, therefore, do not fit comfortably within traditional financial institutional structures. A functional perspective might provide more practical insights into this revolution; however, the functional perspective has had a limited impact. This paper will investigate the benefits and limitations of (...) financial functional analysis; probe the underpinning principles of sociology’s structural functional analysis; revisit Merton and Bodie’s six core financial functions in relation to new entrants in the financial landscape; and, finally, argue that in the new financial environment, functional analysis provides a more coherent and explanatory framework of the financial system for students and practitioners alike. (shrink)

ABSTRACT Economists not only failed to anticipate the financial crisis; they may have contributed to it—with risk and derivatives models that, through spurious precision and untested theoretical assumptions, encouraged policy makers and market participants to see more stability and risk sharing than was actually present. Moreover, once the crisis occurred, it was met with incomprehension by most economists because of models that, on the one hand, downplay the possibility that economic actors may exhibit highly interactive behavior; and, on the other, (...) assume that any homogeneity will involve economic actors sharing the economist’s own putatively correct model of the economy, so that error can stem only from an exogenous shock. The financial crisis presents both an ethical and an intellectual challenge to economics, and an opportunity to reform its study by grounding it more solidly in reality. (shrink)

Economists not only failed to anticipate the financial crisis; they may have contributed to it—with risk and derivatives models that, through spurious precision and untested theoretical assumptions, encouraged policy makers and market participants to see more stability and risk sharing than was actually present. Moreover, once the crisis occurred, it was met with incomprehension by most economists because of models that, on the one hand, downplay the possibility that economic actors may exhibit highly interactive behavior; and, on the other, assume (...) that any homogeneity will involve economic actors sharing the economist’s own putatively correct model of the economy, so that error can stem only from an exogenous shock. The financial crisis presents both an ethical and an intellectual challenge to economics, and an opportunity to reform its study by grounding it more solidly in reality. (shrink)

In traditional reward systems, managers’ key performance indicators must surpass an agreed target in order to achieve a financial bonus. This system is designed to motivate high performance; yet adverse behavioural effects are often observed. These include middle managers becoming incentivised to game the reward system and target negotiation process they are subject to. This paper discusses three approaches to preventing such undesirable behavioural effects: Firstly, a linear pay-for-performance system without a target floor for receiving a performance bonus. Secondly, a (...) bonus banking system where managers participate at the company’s losses as well as its gains. Thirdly, a proposal that uses the Beyond Budgeting approach which radically negates the core premises of the traditional reward system and replaces rewards for individual manager performance with those for wider team performance. These three approaches are compared and evaluated with respect to their potential to prevent unwanted manager behaviour, and on consideration of how effectively they may be operationalised. (shrink)

In his Reply, Kindleberger falsely ascribes to me the views that political actors are utterly incompetent, while market actors are completely rational; and that political processes are pure chaos, while market processes are perfectly efficient. My point was that the relatively better performance of the market is a result of systemic factors, not the rationality of individuals. Kindleberger fails to address the historical evidence indicating the comparatively poor performance of government intervention in the monetary order. ?Market manias? are, in fact, (...) largely the product of ill?conceived government regulations. (shrink)

This research addresses equity in geographic access to financial services. As financial products and services continue to become more accessible and affordable, many low‐ to moderate‐income Americans remain unbanked and underbanked, relying instead upon informal, alternative financial service providers, including check cashing outlets and payday lenders. While geographic access to affordable financial products and services assists in the successful asset building strategies of economically vulnerable households, concerns that access to financial services is uneven persist. This article uses geographic information systems (...) and spatial binary logistic regression analysis to test the hypothesis that sociodemographic characteristics and mortgage lending variables have a predictive relationship on the presence of financial deserts—census tracts where check cashing outlets are more prevalent than banks—in southeastern Pennsylvania. Results of comparison of means and regression analysis reveal that these tracts are associated with higher than average population density, lower levels of median household income, a higher proportion of Black and Latinx residents, and higher levels of mortgage application denial. This article contributes to the ongoing debate over the emergence of a two‐tiered or dual financial service delivery system, whereby financial products and services are bifurcated based on socioeconomic status and geography. (shrink)

Abstract: We examine how trustworthy behaviour can be achieved in the financial sector. The task is to ensure that firms are motivated to pursue long-term interests of customers rather than pursuing short-term profits. Firms’ self-interested pursuit of reputation, combined with regulation, is often not sufficient to ensure that this happens. We argue that trustworthy behaviour requires that at least some actors show a concern for the wellbeing of clients, or a respect for imposed standards, and that the behaviour of these (...) actors is copied in such a way that it becomes a behavioural norm. We briefly suggest what such behavioural norms might need to be if trustworthy behaviour is to be achieved, and consider how they might be supported; we describe the research that is necessary in order to understand these norms in more detail. We argue that the norms of traders are different from the norms of those engaged in other activities, since they are inevitably self-interested, and we consider the risk that traders’ norms might undermine those of other actors. We analyse the task for governance in dealing with this problem, and the role which leadership by a corporate board and management might play in doing this. We describe the need for further research in to describe how this might be done. (shrink)

The management control system aids administrators in guiding a business toward its organizational plans; as a result, management control is primarily concerned with the execution of the plan and plans. Financial and nonfinancial criteria are used to create management control systems. The financial element focuses on net income, earnings, and other financial metrics. The two components of leadership strategy in this study are cost and differentiation, which highlight the strategy of differentiation in attaining higher quality due to the robust strategy’s (...) attention on a particular area of the company. In this study, we presented a novel method named deep interaction neural network to predict the performance of the manufacturing companies based on their leading competitors using features cost leadership and differentiation strategies. Moreover, the management control system is classified into two financial and nonfinancial factors based on machine learning methods. Based on the results, the presented factors can accurately estimate the company’s performance based on management control criteria with a 93.48% R-square. Moreover, it can be seen that the DT method is presented with higher classification performance values. (shrink)

With the development of the globalization of science and technology, innovation has become an important driving force for regional economic development. As a core element of regional innovation, financial R&D resources have also become a key element to enhance national innovation capabilities and national economic competitiveness. National and regional innovation capabilities have a direct impact. There are also many deep-seated problems behind the world-renowned achievements, such as irrational industrial structure, insufficient independent innovation capabilities, low resource utilization efficiency, and the service (...) quality and efficiency of financial institutions for the transformation of total factor productivity. These problems extremely restrict the efficiency upgrade and further development of our country’s total factor productivity. This study uses the DEA-Malmquist index model to measure the efficiency of fiscal R&D resource allocation in 28 provinces and regions in China in the past 10 years and uses Mapinfo12.0 software to analyze regional differences in the efficiency of fiscal R&D resource allocation in China from a spatial perspective. During the year, the overall R&D resource allocation efficiency of 28 provinces and autonomous regions in China has shown an upward trend. The efficiency of fiscal R&D resource allocation and the concentration of financial factors have had a positive impact on total factor productivity, transform and upgrade factors, increase total factor productivity, and provide empirical evidence for building a strong country. (shrink)

The financial crisis that began on 17 August 1998 confirmed any fears that we might have had as to the robustness of the Russian banking system and more generally its financial system. It also pointed up the organic link between the confidence essential to the working of the banking system and the State's ability to guarantee the legality of it. Although improvements have been seen since then, the fundamental issue remains.

Financial risks are among the most important risks in the construction industry projects, which significantly impact project objectives, including project cost. Besides, financial risks have many interactions with each other and project parameters, which must be taken into account to analyze risks correctly. In addition, a source of financial risks in a project is the contract, which is the most important project document. Identifying terms related to financial risks in a contract and considering their effects on the risk management process (...) is an essential issue that has been neglected. Hence, an integrated model for evaluating financial risks and their related contractual clauses were presented. To this end, the effect of financial risks on the project cost was simulated using a system dynamics model. Moreover, terms related to financial risks in a contract text were identified and extracted using text mining, and their effect was included in the system dynamics model. The model was implemented in a hospital construction project in Tehran as a case study, and its results were analyzed. The innovation of the research is integrating text mining and the system dynamics model to investigate the effect of financial risks and related contractual clauses on the project cost. (shrink)

In the article the effect of disbalances in the movement of financial resources on the national financial systems is formalized. For ensuring the corresponding monitoring objectives the financial sustainability indicators developed by the IMF and the World Bank have been used, as well as the integral indicator of financial resource disbalances, which serve as statistical units for measuring the financial situation and sustainability of the financial sector of the country. For the overwhelming majority of the studied countries, the hypothesis about (...) the negative impact of disbalances in the flow of financial resources on the stability of their financial sectors, regardless of the general economic conditions of these countries' development, was confirmed. At the same time, such a hypothesis was denied for a group of developing countries. Conditions-destabilizers of financial sectors’ stability of the countries under the influence of financialization of their economies, which should be considered the object of regulatory measures in financial markets, are defined. These include the level of market integration into the global financial space, which determines the tendency to systemic risks transmission and the degree of markets’ development that affects their volatility. (shrink)

In order to better assist investors in the evaluation and decision-making of financial data, this paper puts forward the need to build a reliable and effective financial data prediction model and, on the basis of financial data analysis, integrates deep learning algorithm to analyze financial data and completes the financial data analysis system based on deep learning. This paper introduces the implementation details of the key modules of the platform in detail. The user interaction module obtains and displays the retrieval (...) results through data parsing, calling the background, and computing engine. The data cleaning module fills, optimizes, and normalizes the data through business experience; the calculation engine module uses the algorithm and extracts the database information to get the similar time series and matching financial model. Finally, the data acquisition module fills the database with historical data at the initialization stage and updates the database every day. The data analysis platform for quantitative trading designed and implemented in this paper has carried out demand analysis, design, implementation, and test. From the perspective of function test and performance test, two functions of similar stock search and financial matching model are selected and tested, and the results are in line with the expected results. (shrink)

This study was an attempt to examine the using intelligent systems to manage risks and reduce financial risks using artificial intelligence in large companies. The data collected from the data is collected from the stock organization and the stock Securities of Iran. Moreover, the data is collected from 17 companies for ten years and the data was collected through the variance formula and then the results were examined using the SSPS method. Variance formula is σ µ 2= xi- 2 /n (...) ( ( )) ∧ ∧ ∑. The data is completely obtained from a reliable and correct source, which is related to the Department of Statistics of Iran’s Stocks and Securities. After categorizing and classifying the collected information and data, it is processed and analyzed, and the results and findings of this study are stated. In order to examine the research questions, appropriate tests (Shefe tests) were used to analyze the data. The analysis of data revealed that the findings of this study reveal that Shatran, Arya, Shebandar, Famili are profitable among other stocks. Other stocks are loss because of high cost of raw materials and sanction of Iran. Moreover, companies could not export their products. Plus, the purchase power of the people in the country decreases because of the inflation of the country, so the companies could not buy anything. On the one hand, liquidity power of people, on the other hand, less export lead to the decrease of cash flow, liquidity power of companies and firms and could not sell their products. It can be concluded that those stocks are loss and have high risk. (shrink)

The paper focuses on the constitutional foundations of the finance system of the Republic of Lithuania. Constitutional jurisprudence pays due respect to the issues of budget system, and to interpret and analyse tax problems. The main purpose of this paper is to analyse separate institutes of the financial system of Lithuania, reflected in the main law of the country – the Constitution, and how these norms are interpreted in the constitutional doctrine. Notably, although the main analysed provisions are entrenched in (...) the Chapter XI “Finances and state budget,” the paper is not restricted only on the analysis of these norms, but also provides a complex analysis of other connected norms and their interpretation in the constitutional jurisprudence. (shrink)

"American criminal justice is a dysfunctional mess. The so-called Land of the Free imprisons more people than any other country in the world. Understanding why means focusing on color -- not only on black or white, but also on green. The problem is that nearly everyone involved in criminal justice faces bad incentives. "Injustice for All" systematically diagnoses why and where American criminal justice goes wrong, and offers functional proposals for reform. By changing who pays for what, how people are (...) appointed, how people are punished, and which things are criminalized, we can make the US a country which guarantees justice for all." --. (shrink)

This study investigates how diverse European legal systems and financial structures influence corporate social and environmental responsibility. The argument is developed by means of a framework that integrates legal systems and financial structures. Hypotheses relating to environmental responsibility have been tested using Innovest data gathered between 2002 and 2007 from 645 companies in 16 countries; and hypotheses relating to social responsibility have been tested using Innovest data gathered between 2004 and 2007 from 600 companies. The findings demonstrate that legal systems (...) influence corporate responsibility (CR) in both social and environmental spheres. They also support the claim that corporations are more likely to act in environmentally responsible ways when there are strong and well-enforced state regulations in place to ensure such behavior. Company size is shown to have a greater impact on CR than either excess cash or performance. Large companies tend to be more visible than small ones do, and society expects them to behave in a more socially and environmentally responsible manner regardless of their financial performance or available cash. Finally, these findings support the hypothesis that capital structure significantly influences CR: companies with a high number of publicly held shares and a low percentage of debt are more likely than others to commit themselves to social and environmental activities. (shrink)

Concerns about population ageing apply to both developed and many developing countries and it has turned into a global issue. In the forthcoming decades the population ageing is likely to become one of the most important processes determining the future society characteristics and the direction of technological development. The present paper analyzes some aspects of the population ageing and its important consequences for particular societies and the whole world. Basing on this analysis, we can draw a conclusion that the future (...) technological breakthrough is likely to take place in the 2030s (which we define as the final phase of the Cybernetic Revolution). In the 2020s – 2030s we will expect the upswing of the forthcoming sixth Kondratieff wave, which will introduce the sixth technological paradigm (system). All those revolutionary technological changes will be connected, first of all, with breakthroughs in medicine and related technologies. We also present our ideas about the financial instruments that can help to solve the problem of pension provision for an in-creasing elderly population in the developed countries. We think that a more purposeful use of pension funds' assets together with an allocation (with necessary guarantees) of the latter into education and upgrading skills of young people in developing countries, perhaps, can partially solve the indicated problem in the developed states. (shrink)

The European System of Financial Supervision (ESFS) was established by the EU at the beginning of 2011. Participating in its operation are national authorities and EU bodies (or agencies), which are known as European Supervisory Authorities (ESAs). Under the ESFS, day-to-day supervision remains overwhelmingly a matter for national authorities, but the ESAs are vested with certain intervention powers over national authorities and, exceptionally, over market actors. The aim of this article is to ask questions about the division of labour between (...) the ESAs and the national authorities. Thereby, it seeks to participate in the debate on what ought to be the future direction of the ESFS. Specifically, it seeks to open the debate on whether intervention-based supervision or EU day-to-day supervision should be preferred. Focusing mainly on the European Securities and Markets Authority (as one of the ESAs), the article concludes that intervention-based supervision has prima facie more to offer. (shrink)

Households and banks have increasingly displaced non-financial businesses and governments as the primary debtors in modern capitalist economies, resulting in more severe economic cycles, increased inequality, and external macroeconomic imbalances. Yet while the trend is nearly universal among developed economies, its intensity varies a great deal from country to country. This article highlights the common international causes behind the global expansion of household and financial sector debt; the divergent national approaches to household credit that cause household and financial sector indebtedness (...) to vary from country to country; and the likely causes of these disparate approaches. National approaches to interest rate restrictions, property transfer taxation, high loan-to-value mortgages, mortgage interest taxation, and secondary markets for consumer debt can either encourage or mitigate household and financial sector borrowing. Whether a country encourages or mitigates such credit is determined by an idiosyncratic mix of institutional, political, and ideational factors. Especially important are the size of domestic pension funds, banks’ preferred business models, the political power of financial firms, and whether policymakers are more sensitive to the gains promised by a credit-fueled expansion or to the risks posed by an overleveraged collapse. (shrink)

The paper describes the main features of financial stability and the preparation of the reform of the global financial system. The mortgage crisis in the USA brought about the global financial crisis. This crisis was the result of the failure of financial regulation, including supervision, and the failure of the management of the banking industry. Therefore, the international community, including Group 20, urged the appropriate institutions to introduce a comprehensive reform of the financial sector. To avoid a potential financial crisis, (...) the creation of the framework for financial stability would be needed. In line with this, the paper examines the interaction between both monetary and fiscal policies, including micro-and macroprudential policies and their instruments. Although still is going on discussion on definition of macroprudential policy, there is a generally accepted opinion that macroprudential policy should limit systemic risk. In addition, this policy should focus on interaction between the financial system and the real economy. Furthermore, micro- andmacroprudential policy should use appropriate instruments in dealing with the systemic risk. In this regard, the article undescores that put in a place the frameworkfor financial stability will create favorable conditions for decision-makers how they should to respond to financial imbalances. The paper also pointed out some potential economic costs related to the implementation of the overall international reform of the financial sector. Based on comprehensive literature study, the author came to the conclusion that despite the fact that there will be some economic costs related to implementing the overall regulatory reform of the financial sector, the main benefit from the long-term perspective will be avoiding the potential financial crisis in the future. To fulfill all the requirements for global financial reform, international cooperation will be needed. (shrink)

The complex chaotic dynamics and multistability of financial system are some important problems in micro- and macroeconomic fields. In this paper, we study the influence of two-delay feedback on the nonlinear dynamics behavior of financial system, considering the linear stability of equilibrium point under the condition of single delay and two delays. The system undergoes Hopf bifurcation near the equilibrium point. The stability and bifurcation directions of Hopf bifurcation are studied by using the normal form method and central manifold theory. (...) The theoretical results are verified by numerical simulation. Furthermore, one feature of the proposed financial chaotic system is that its multistability depends extremely on the memristor initial condition and the system parameters. It is shown that the nonlinear dynamics of financial chaotic system can be significantly changed by changing the values of time delays. (shrink)

This study utilizes hierarchical regression analysis to explore how environmental management systems influence financial performance through customer satisfaction and customer loyalty, and the moderating effects of switching cost. The originality of the present research is to unpack the “black box” through which a firm can profit from EMSs. The empirical results indicate that EMSs have positive and significant impacts on customer satisfaction, customer loyalty, and financial performance. In addition, switching cost negatively and significantly moderates the relationship between EMSs and customer (...) satisfaction, but does not significantly moderates the relationship between EMSs and customer loyalty. The results also demonstrate that customer satisfaction and customer loyalty partially mediate the relationship between EMSs and financial performance. Our findings highlight that customer satisfaction, customer loyalty, and switching cost play important roles for a firm to profit from EMSs. (shrink)

This study aims to identify the necessary strategies for the development of a sustainable financial system. For this purpose, a novel approach could be provided for soft computing with Gaussian-based fuzzy DEMATEL approach to understand the significant levels and impact-relation degrees of these criteria. For robustness check, this evaluation has also been performed for triangular and trapezoidal fuzzy sets. There are many novelties of this study. Firstly, computer science has a significant role in the decision-making process. Another specificity is that (...) the use of Gaussian numbers with fuzzy numbers is a new area. In addition, interval type-2 fuzzy sets also provide a significant advantage in decision-making under uncertainty. The results demonstrate that the size of the alternative financing, investment in efficient projects, and effective advertisement/promotions are the most important items to affect the performance of alternative banking system of emerging economies. Hence, it is recommended that the new banking applications should be applied by the state or the state can provide some incentives for foreign banks to invest in emerging economies, such as tax reduction. Another important point is that the financial intermediations should generate a component financial analysis team to examine the financial reports of the companies in detail so that the financial credibility of these companies can be evaluated more effectively. (shrink)

To understand the variations in the financial characteristics, we examine the dynamical behaviors by considering the chaotic financial model with external force. First, the dynamical characteristics are analyzed by introducing the external driven force in the price index with commodity demand. We discover that the presence of an external force causes the alternate occurrence of oscillatory and steady states as a function of time. Interestingly, we find the existence of bifurcation delay during the transition from oscillatory to steady state or (...) vice versa. Bifurcation delay is a phenomenon in which the bifurcation does not occur at the actual bifurcation point but rather at a later time, which is referred to as bifurcation delay. To confirm the delay in bifurcation, we estimate the actual bifurcation point and compare it to the observed bifurcation transition. Furthermore, to understand the variations in the bifurcation delay, we estimate the delay time between each consecutive cycle and find random fluctuations in the BD. Following that, the BD is virtualized via a transformed phase portrait. In addition, we show decreasing the value of average BD while increasing the frequency of external forcing. Second, the presence of BD is explored by incorporating external forces into the investment demand with unit investment cost. We discover the existence of a similar phenomenon with a constant bifurcation delay. (shrink)

Both healthcare professionals and the healthcare system must defend each patient's health individually while simultaneously seeking to protect the population's health in general. Nowadays, there is an important increase in the cost of healthcare supply, mainly due to the developments of medical science, the public's expectations and the demographic ageing. Since healthcare resources are not unlimited, it is obvious that immoderate consumption of them by certain patients limits the use of the same funds by others. Therefore, we have to seek (...) an optimal distribution of the existing resources in order to manage a constriction of expenses, especially under the circumstances of the modern economic crisis. The criteria of effectiveness and efficiency should be used. Health policies focus on both the public's behaviour and the rules of medical practice. Under the modern challenges the physician's role is particularly important for the protection of the patient's health and the promotion of public health. (shrink)

Financial crises have become an all-too-common occurrence over the past twenty years, largely as a result of changes in finance brought about by increasing internationalization and integration. As domestic financial systems and economies become more interlinked, weaknesses can significantly impact not only individual economies but also markets, financial intermediaries and economies around the world. This volume addresses the twin objectives of financial development in the context of financial stability and the role of law in supporting both. Financial stability (frequently seen (...) as the avoidance of financial crisis) has become an objective of the international financial architecture as well as individual economies and central banks. At the same time, financial development is now seen to play an important role in economic growth. In both financial stability and financial development, law and related institutions have a central role. (shrink)

In this research work, we formulate the phenomena of the financial system in the fractional framework to describe the complex nature of finance. The basic definitions and ideas of the Caputo-Fabrizio fractional operator are listed. We introduce a novel numerical technique for the dynamical behaviour of our fractional model. The oscillatory and chaotic behaviour of the model is studied with the variation of various input parameters on the model. We have shown that there exists strong oscillatory and chaotic behaviour in (...) the system; moreover, we highlighted the impact of fractional-order parameter on the model. The conditions for the local complex behaviour of the system are analyzed with the impact of certain parameters on the macroeconomic. Our findings suggest that the values of initial conditions, fractional order, and input parameters can lessen the chaos of the proposed financial system. (shrink)

Based on the existing financial system risk models, a set of time-lag financial system risk models is established considering the influence brought by time-lag factors on the financial risk system, and the dynamical behavior of this system is analyzed by using chaos theory. Through Matlab simulation, the bifurcation diagram and phase diagram of time-lag risk intensity and control intensity are plotted. The analysis shows that this kind of time-lag financial system risk model has complex dynamic behavior, different motion states will (...) appear when different parameter values are selected, and the time-lag risk intensity parameter also has a very strong influence on the system motion. To ensure the operation of the financial system in a stable state, measures with certain delay effects must be taken to control the risk and to choose the appropriate time-lag control intensity, and too much or too little time-lag control intensity is not conducive to the benign operation of the system. (shrink)

It is not easy being green, but it does beg the question: Does being green pay off on the bottom-line? Unfortunately, that question of becoming ISO 14001 to reap financial benefit remains widely unanswered. In particular, corporate practice is interested in how environmental management impacts firms’ finance through top-line impact, bottom-line impact, or both—as this paves the way for an investment of environmental management. As current findings are mixed, our study tracks financial performance of publicly traded US firms between 1996 (...) and 2005 to test whether ISO 14001 leads to improved financial performance. Employing a rigorous event-study approach, we compare certified firms to different control groups based on several matching criteria that include industry, size, and/or ROA. In the short run, ISO 14001 certification makes only a minor impact on the bottom-line, according to our results. However, these same results show a significant financial improvement over the long haul with ISO 14001 certification. Additionally, this long-term improvement also makes a significant improvement in top-line performance. Thus, we conclude that environmental management pays off along both dimensions. (shrink)

With the rapid development of the market economy, there are more and more projects in the financial industry, and their complexity and technical requirements are getting higher and higher. The development of computer technology has promoted the birth of robot consultants, and it is of great significance to use robot consultants to manage and supervise financial industry projects. In order to further analyze the development and supervision of robo-advisors under the digital inclusive financial system, this paper uses complex systems and (...) clustering algorithms as technical support to carry out research. First, the traditional K-means algorithm is used to select the initial clustering center, to improve the noise and outlier processing capabilities, and to build a data mining system based on the improved algorithm. Then, a product design model for robo-advisors is built and the risks of robo-advisors are analyzed from three aspects: technology, market, and law. Analyzing the performance of the improved K-means algorithm, in the operation of the experimental dataset B, the accuracy of the clustering result after 6 iterations reached 97.08%, which shows that the algorithm has good performance. During the trial operation of the data mining system, the four types of customers of financial institutions were accurately clustered, and it was concluded that the main type of customers who brought benefits to financial institutions was high-income customers accounting for 10.75%. Robo-advisory product models are used to build five risk-level investment portfolios and conduct risk backtests. Except for the growth and income portfolio, other portfolios have consistently outperformed the performance benchmark during the analyzed time period. Running the research system of this paper in a financial institution, comparing the capital budget before and after the operation, found that the system can improve the accuracy of the budget and reduce the risk of the robo-advisor for the financial institution. (shrink)

Magna Carta Libertatum or the Great Charter of the Liberties is a historical document of great significance for the constitutional history and human rights and liberties development. Although at its initial version it addressed a limited number of liberties and principles, it represented a solid foundation for the evolution of the principles of the rule of law, right to justice, right to a fair trial, just and reasonable sentencing, limitation of powers, etc. Namely, article 20 of the Charter states: A (...) freeman shall not be amerced for a slight offense, except in accordance with the degree of the offense; and for a grave offense he shall be amerced in accordance with the gravity of the offense, yet saving always his “contenement”; and a merchant in the same way, saving his “merchandise”; and a villein shall be amerced in the same way, saving his “wainage” if they have fallen into our mercy: and none of the aforesaid amercements shall be imposed except by the oath of honest men of the neighborhood. An analysis of this article undoubtedly leads us to the basic principles of the contemporary systems of fine, namely the daily-fine system introduced in the Macedonian Criminal Code in 2004 according to which the fine will be calculated and pronounced according to the gravity of the offence and the financial state and condition of the perpetrator. As one can notice, the gravity of the offence and the saving of the perpetrators “contenement” from the abovementioned article of the Great Charter refer to the aforesaid principles. In this article, a comparison will be made on the meaning of the term “amercement” and its similarities and differences with the modern financial penalties and measures in the criminal law from comparative perspective, to find which one corresponds to the latter: fine, assets forfeiture or compensation of damages made with the criminal offence. (shrink)

Today, the risk management of budget challenges throughout the budget process is greater than ever. The process of change has been driven by new information and communication technologies, resulting in e-government. The purpose of this scientific paper is to see whether budgetary challenges have an effect on the performance of e-government in complex financial systems based on factors F1, F2, F3, F4, and F5: lack of information, lack of cooperation, lack of resources and reduction of focus, lack of budget experts (...) and financial stability, and shortcomings and inconsistencies during the budget process. Therefore, this study aims to advance the understanding of how to manage risks from budgetary challenges by focusing on a novel approach to improve e-government performance in complex financial systems. Empirical research was based on three key issues: an approach to e-government, analyzing which variables need more attention to risk, and learning how to meet budgetary challenges to improve performance during governance. For this study, the data were conducted by Kosovo’s public institutions, more specifically at the central level and at the local level. A total of 38 questionnaires were analyzed and divided into three sessions, which were analyzed through three analyses, such as factor analysis, data reliability analysis, and multiple regression analysis, using SPSS version 23.0 for Windows. The research was conducted over the years 2017, 2018, 2019, and 2020, while the analysis involved several processes, where some of the factors were removed in order to make the model acceptable. In this case, 21 variables were tested and divided into 5 factors. The results showed that special attention should be paid to these factors to reduce budgetary challenges and increase the performance of e-government in complex financial systems, such as lack of resources, increasing the focus on risk management even after the transfer of funds from the ministry to the municipality, the selection of programs based on priorities and not on the basis of wishes and policies, having political stability, rule of law, and more control, and having regulations and guidelines from the practices of developed countries as well as taking into account the opinions of budget experts. The implications of this paper have to do with only a considerable number of variables, which were taken in the study as well as only in the municipalities of Kosovo. In this case, for other analyses by other researchers, other variables can be analyzed in other countries by making comparisons. (shrink)

In this article, complete synchronization and antisynchronization in the identical financial chaotic system are presented. The proposed control strategies depend on first-order sliding mode and adaptive integral sliding mode for complete synchronization and antisynchronization of the identical financial chaotic system. In the primary case, the system parameters should be known, and first-order sliding mode control is utilized for synchronization and antisynchronization while in the second case, the system parameters are considered unknown. An adaptive integral sliding mode control strategy is utilized (...) for synchronization and antisynchronization of the system considering the parameters unknown. The error system is changed into a particular structure containing a nominal part and several unknown terms to utilize the adaptive integral sliding mode control. Then, this error system is stabilized using integral sliding mode control. The stabilizing controller is usually developed based on the nominal part plus the compensator control part. To suppress the high-frequency oscillation phenomenon, smooth continuous compensator control can be used rather than conventional discontinuous control. The compensator controller along with the adapted law is derived such that the time derivative of the Lyapunov function becomes strictly negative. The effectiveness of the proposed method was tested through computer simulations. The proposed control strategies are verified for that Identical 4D hyperchaotic financial system to attain complete synchronization and antisynchronization along with the improved performance. (shrink)

The purpose of this paper is two-fold. First, this study measures the contribution of banks and non-bank financial institutions toward the systemic risk of China. Second, the present study investigates the relationship between CEO power, CEO overconfidence, and systemic risk. This study uses the Delta Conditional Value-at-Risk method to measure the systemic risk contribution of firms listed on the Shenzhen and Shanghai stock exchanges over a period of 2006–2018. The results show that non-bank financial institutions are systemically more important compared (...) to banks. We employed fixed-effect regression analysis to show that banks with overconfident CEOs increase the firm’s systemic risk. The results also confirm that powerful CEOs enhance the contribution of non-bank financial institutions to systemic risk, whereas CEO power’s impact was significant only for non-state-owned banks. The findings were further validated by the robustness test results obtained using the two-stage least squares approach. These findings are important for constructing regulations to reduce the contribution of firms to systemic risk. (shrink)

Based on the research of currency crisis pressure index, bank crisis pressure index, and asset bubble crisis pressure index, this paper introduces an external shock pressure index reflecting the impact of global economic changes on economy and synthesizes systemic financial crisis pressure based on the above four pressure indexes; then, all the alternative early warning indicators and the systemic risk pressure index constructed in this paper were tested for Granger causality. We build financial systemic risk pressure indexes, including currency crisis (...) pressure banking crisis pressure index, bubble crisis pressure index, and external shock pressure index to predict financial crises. Finally, four indicators that have a significant impact on the systemic financial crisis pressure index were selected, namely, the stock price index change rate, industrial added value growth rate, domestic and foreign real deposit interest rate differential, and foreign direct investment as a percentage of GDP. A dynamic Logit model with lagging binary variables is constructed, and compared with the traditional static Logit line, the actual dynamic fitting effect is better than the static Logit model. The dynamic Logit model is used to predict the early warning status of systemic financial crisis in 2020, and the forecast of various early warning indicators is realized by the ARIMA model. The final prediction results show that the probability of a systemic financial crisis in China in 2020 is extremely low, almost zero. This is in line with the overall improvement in the international economic situation in 2020 and the steady growth of the domestic economy. (shrink)

The financial toxicity of biotherapeutic treatments is examined. Kymriah, a new gene therapy, has a list price of $475,000 per treatment; Yescarta, from Kite Pharma, costs $373,000 per treatment. Such costs are a significant burden on patients, patients’ families, payers, health care systems, and communities. Studies have shown that financial toxicity—the effect of excessive treatment cost—diminishes patients’ quality of life, compliance, and survival. Some pharmaceutical companies promote outcomes-based pricing and other strategies to offset financial toxicity, but these approaches have not (...) been shown to reduce burdens. Catholic teaching holds that the benefits of treatment should outweigh its burdens, and that burdensome treatments are not obligatory. The financial toxicity of treatments should be included in the ethical assessment of burdens on the patient. (shrink)

The U.S. health care system is ostensibly market based and therefore at least partially reliant on competition and consumer demand to regulate costs. Yet information about an essential feature of market transactions—costs—is typically obscure to patients until long after treatment. When discussing what must be disclosed for informed consent, the same list of required information is often mentioned regardless of the health care system in question, and information about costs rarely merits a place within this list. However, our assumptions about (...) what a moral principle requires need to be responsive to the realities of the health care system in which the principle is applied.This paper explores the moral foundations of disclosure and informed consent to argue that, in a market‐based system of the sort found in the United States, these same considerations support a requirement to disclose out‐of‐pocket costs before patients receive care. Next, I consider two objections to this view: first, that health care practitioners should focus solely on medical considerations in their encounters with patients and, second, that disclosing out‐of‐pocket costs would be too difficult to be mandated. I argue that medical and financial interests are inseparable within the U.S. health care system. If the difficulties in disclosing costs are deemed insurmountable, then the current system may prove unsustainable, both morally and financially, since we face the same practical impediments to implementing any meaningful consumer‐driven, market‐based health care reform. Finally, I explore some of the consequences of failing to disclose costs. The requirements of disclosing costs can be supported by the principle of respect for autonomy, regardless of the consequences, but in light of the consequences of the decision of whether to disclose, a concern about justice provides further support. (shrink)