Purpose Risk-based clearing has been proposed by Rausser et al . (2010) for over-the-counter (OTC) derivatives. This paper aims to illustrate the application of risk-based margins to a case study of the mortgage-backed securities derivative portfolio of the American International Group (AIG)...

Purpose Crisis events are windows of opportunity during which a country’s leaders may implement economic policy adjustments which change that country’s level of economic freedom and affect the local capital market. This paper aims to investigate the relationship between annual changes in an...

Purpose Using the economic policy uncertainty (EPU) index as a proxy for the level of EPU, we study the impact of the level of EPU on the conditional mean of market returns and we examine the predictive power of EPU on future market returns. Design/methodology/approach We employ a GARCH-in-Mean...

Purpose We explore how economic freedom measurements can be used to guide policy. Design/methodology/approach We propose a method for creating a growth-enhancing economic freedom index, which allows for nonlinearities and interaction effects between the components to economic freedom. We use...

Purpose The purpose of this study is to examine the role of reducing information asymmetry (IA) on conditional financial sector development in 53 African countries for the period 2004-2011. Design/methodology/approach The empirical evidence is based on contemporary and non-contemporary quantile...

Purpose Congress passed the Stop Trading on Congressional Knowledge (STOCK) Act of 2012, vesting the Securities and Exchange Commission with the clear legal authority to prosecute members of Congress (politicians) if they engage in insider trading. This paper aims to investigate whether members...

Purpose – The purpose of the paper is to explain how UK bank failure resolution policy has evolved since the nationalisation of Northern Rock in February 2008 in the light of the fallout from the sub‐prime crisis and the subsequent credit crunch. Design/methodology/approach – The evolution...

Purpose – The purpose of this paper is to analyze a particular segment of the US “shadow banking” market and its revival since the recent credit crisis, namely, lending to the private Middle Market, defined as financings of $5-100 million to non-public, unrated operating entities or pools...

Purpose – Employing data on 14 major Indian states during 1973‐2004, this paper aims to investigate the hypothesis that economic growth is affected by financial outreach. Design/methodology/approach – The paper employs univariate tests as well as advanced panel regression techniques to...