DOI: https://doi.org/10.15587/2312-8372.2018.146142

Analysis of the regional differentiation of the world financial market

Mikhail Bondarenko, Serhii Bunin

Abstract


The object of research is the global financial market, which unites national financial systems and has significant regional development differentiation. One of the most problematic places for the development of the world market is the reduction of the internal regulatory influence of countries on their financial system as well as the growth of world debt of countries on foreign borrowing, the volatile nature of market development, where the law of uneven economic development manifests itself.

The analysis of the dynamics of the global market is used for such indicators as:

  • foreign direct investment and its net outflow (% of GDP);
  • foreign direct investment and its net inflow (% of GDP);
  • the number of national companies listed on the stock exchange and their market capitalization.

With the help of classical general scientific research methods, regression analysis, statistical data processing methods, it is obtained that the lowest indicators of capital outflow are inherent in the countries of rapid development (Latin America and the Caribbean, South Asia). The highest rates of capital inflows are inherent in highly developed countries within the European Union or the Eurozone. Most of the companies with quotes on the stock exchange and the largest market capitalization, located in the OECD (Organization for Economic Cooperation and Development), including in the European Union. This is due to the fact that all components of the market are in close relationship. The increase in the volume of monetary savings of the population and free funds of enterprises contributes to the expansion and revitalization of the credit market and the securities market. And the issue of securities reduces the need for financing the economy through loans and accumulates temporarily free funds of investors. This ensures the conditional nature of the separation of financial markets into the money and capital markets.


Keywords


global financial market; regional differentiation of development; foreign direct investment; financial capitalization of national companies

References


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Sarwar, G. (2014). U.S. stock market uncertainty and cross-market European stock returns. Journal of Multinational Financial Management, 28, 1–14. doi: http://doi.org/10.1016/j.mulfin.2014.07.001

Bond, P., Leitner, Y. (2015). Market run-ups, market freezes, inventories, and leverage. Journal of Financial Economics, 115 (1), 155–167. doi: http://doi.org/10.1016/j.jfineco.2014.08.008

Straehl, P. U., Ibbotson, R. G. (2017). The Long-Run Drivers of Stock Returns: Total Payouts and the Real Economy. Financial Analysts Journal, 73 (3), 32–52. doi: http://doi.org/10.2469/faj.v73.n3.4

Switzer, L. N., Tahaoglu, C. (2015). The benefits of international diversification: market development, corporate governance, market cap, and structural change effects. International Review of Financial Analysis, 42, 76–97. doi: http://doi.org/10.1016/j.irfa.2014.11.010

World Development Indicators (WDI). Available at: https://datacatalog.worldbank.org/dataset/world-development-indicators Last accessed: 20.05.2018


GOST Style Citations


Petryk O. I. Shliakh do tsinovoi stabilnosti: svitovyi dosvid i perspektyvy dlia Ukrainy: monograph / ed. by Heiets V. M. Kyiv: UBS NBU, 2008. 369 p.

Bilorus O. H., Lukianenko D. H. et. al. Hlobalizatsiia i bezpeka rozvytku: monograph. Kyiv: KNEU, 2001. 736 p.

Brigham E., Gepanski L. Financial Management Theory and Practice. Chicago: The Dryden Press, 2011. 1184 р.

Liaskovets H. M. Doslidzhennia rozvytku svitovoho finansovoho rynku v umovakh tsyklichnosti svitohospodarskoho rozvytku. Odessa-Sevastopol-Donetsk: DonNU, RF NYSY, 2011. P. 425–433.

Market institutions, financial market risks, and the financial crisis / Carey M. et. al. // Journal of Financial Economics. 2012. Vol. 104, Issue 3. P. 421–424. doi: http://doi.org/10.1016/j.jfineco.2012.02.003 

Hagelin N. Index option market activity and cash market volatility under different market conditions: an empirical study from Sweden // Applied Financial Economics. 2000. Vol. 10, Issue 6. P. 597–613. doi: http://doi.org/10.1080/096031000437953 

Sarwar G. U.S. stock market uncertainty and cross-market European stock returns // Journal of Multinational Financial Management. 2014. Vol. 28. P. 1–14. doi: http://doi.org/10.1016/j.mulfin.2014.07.001 

Bond P., Leitner Y. Market run-ups, market freezes, inventories, and leverage // Journal of Financial Economics. 2015. Vol. 115, Issue 1. P. 155–167. doi: http://doi.org/10.1016/j.jfineco.2014.08.008 

Straehl P. U., Ibbotson R. G. The Long-Run Drivers of Stock Returns: Total Payouts and the Real Economy // Financial Analysts Journal. 2017. Vol. 73, Issue 3. P. 32–52. doi: http://doi.org/10.2469/faj.v73.n3.4 

Switzer L. N., Tahaoglu C. The benefits of international diversification: market development, corporate governance, market cap, and structural change effects // International Review of Financial Analysis. 2015. Vol. 42. P. 76–97. doi: http://doi.org/10.1016/j.irfa.2014.11.010 

World Development Indicators (WDI). URL: https://datacatalog.worldbank.org/dataset/world-development-indicators (Last accessed: 20.05.2018)







Copyright (c) 2018 Mikhail Bondarenko, Serhii Bunin

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ISSN (print) 2226-3780, ISSN (on-line) 2312-8372