Search Results (56)

Economic shocks in international systems propagate not only through financial channels but also through real-sector interactions, creating feedback effects that can amplify systemic risk across countries. However, country-level systemic risk assessments often rely on single-layer analyses, potentially overlooking such cross-channel dynamics. To investigate how country-level systemic risk interpretations differ across propagation layers, we constructed a multilayer network that integrates cross-border financial exposures and real-sector trade linkages. Using BIS Locational Banking Statistics and UN Comtrade data for 20 countries from 2000 to 2023, we developed a multilayer contagion framework that combines continuous within-layer propagation based on DebtRank with a threshold-based mechanism that activates cross-layer contagion when critical loss levels are exceeded. Initial shocks were calibrated using sovereign credit default swap (CDS), which implies default probabilities, to reflect market-based credit risk conditions. The results show that countries’ systemic roles and risk transmission patterns vary across layers and over time, and that incorporating cross-layer amplification reveals vulnerabilities not captured by single-layer models. Full article

This study examines the regime-dependent threshold between fiscal and monetary policy interactions across the EU-27 states, utilizing quarterly data from 2000 to 2025. A fixed-effects panel threshold regression model has been adopted in this study, using endogenously determined debt thresholds, to assess how budget, debt, money supply, inflation, and fluctuations in interest rates interact under different debt regimes. This analysis also incorporates shock dummy variables following mild recessions and inflationary pressures, the global financial crisis, the sovereign debt crisis, the COVID-19 pandemic, and recent energy price and inflationary shocks. Consequently, three major findings emerge: firstly, fiscal deficits increase unemployment across both regimes, but their positive contribution is significantly reduced by 81% in high-debt regimes. Therefore, conventional Ricardian equivalence has been supported throughout this study in terms of precautionary savings and crowding-out impacts, which further contribute to intensifying with alternative debt regimes. Secondly, monetary variables, in this paper, have demonstrated limited direct effects on unemployment mitigation that highlight the transmission mechanisms under high-debt regimes. Thirdly, the effectiveness of crisis response critically depends on existing fiscal spaces, while the debt regime is interconnected with labor market outcomes. The main findings of the study provide empirical support for the Maastricht debt criterion of 60% as a structural threshold, which is a benchmark for a fundamental shift in the policy transmission mechanism. This study has identified rules and regulations for uniform fiscal consolidation as insufficient; rather, state-contingent governance frameworks have been highly recommended for managing asymmetrical fiscal–monetary policy interactions across different debt regimes. Furthermore, it contributes to the reformation of the more impactful fiscal and monetary policy interaction rule under a monetary union. Full article

The rise of the circular economy and e-commerce has led to the emergence of e-commerce closed-loop supply chains (ECLSCs). In practice, investing in process innovation (PI) is key to improving profitability and competitiveness. However, manufacturers at the downstream of ECLSCs often face financial constraints and quality uncertainty of used products, while research on how to select financing strategies under these conditions remains limited. To explore the optimal financing scheme for the ECLSC, this study investigates two financing schemes: bank financing (BF) and FinTech platform financing (FPF), which offers a combination of debt financing (DF) and equity financing (EF). Some key findings are derived. For the ECLSC, the FPF scheme is more profitable when the unit manufacturing cost for new components exceeds the threshold or PI costs are relatively low. Additionally, the FPF performs better when the FPF interest rate is low and the DF ratio is high. The BF is more beneficial when consumer sensitivity to recycling prices or service is low. The FPF enables the ECLSC to achieve maximum profits and minimize environmental impact within a specific range. Furthermore, the financing models are extended to incorporate considerations of fairness, where the optimal financing scheme is primarily influenced by the manufacturing cost. Full article

The sustainability of local implicit debt reflects its effect on promoting economic growth. By analyzing the sustainability of local implicit debt, valuable insights can be gained to support the high-quality economic development of relevant countries. This study, using provincial panel data from China spanning 2006 to 2020, constructs a measurement method for local implicit debt using the MIMIC model and investigates the sustainability of local implicit debt from an economic growth perspective. The results show that local implicit debt has a rising trend but strong economic tournament pressure; an imperfect financial system and stricter financial regulation will affect the scale of local implicit debt. The economic effects of small-scale local implicit debt are not significant; however, when the scale of local implicit debt exceeds CNY 123.88 billion, it can have a significant stimulating effect on regional economic growth. Local implicit debt has a significant sustainability and can significantly drive regional economic growth, with the driving effect being more pronounced in the western regions and at higher thresholds. Full article

This study investigates thermal stress and energy-related anxiety as lived, multidimensional manifestations of energy poverty in Western Macedonia, Greece, a coal phase-out region undergoing just transition. Using a 261-household survey, we construct a thermal stress index from four Likert-type items capturing seasonal thermal adequacy, energy anxiety, and restricted use of rooms. High thermal stress is defined as the upper quartile of the index. Descriptive results indicate that high thermal stress affects 27.2% of households, exceeding a 20% threshold, while energy-related anxiety and restricted room use are widespread. We then estimate logistic regression models to examine whether vulnerability characteristics (disability-related thermal/electric needs, single parenthood, dependent children, benefit receipt, elderly presence), financial stress indicators (arrears, energy debt, frequent forced reductions in consumption), and socio-economic controls (income, employment, tenure, age, gender) predict high thermal stress. Adjusted models show that vulnerability markers do not retain statistically independent associations once controls are included. In contrast, tenure and energy-related financial stress are significantly associated with the probability of high thermal stress. The findings highlight the importance of measurement choices and suggest that experiential indicators capture energy-poverty dynamics that are not reducible to income-based targeting, with implications for just-transition policy design and energy justice. Full article

A special class of complex adaptive systems—biological and social—thrive not by passively accumulating patterns, but by engineering coherence, i.e., the deliberate alignment of prior knowledge, real-time updates, and teleonomic purposes. By contrast, today’s AI stacks—Large Language Models (LLMs) wrapped in agentic toolchains—remain rooted in a Turing-paradigm architecture: statistical world models (opaque weights) bolted onto brittle, imperative workflows. They excel at pattern completion, but they externalize governance, memory, and purpose, thereby accumulating coherence debt—a structural fragility manifested as hallucinations, shallow and siloed memory, ad hoc guardrails, and costly human oversight. The shortcoming of current AI relative to human-like intelligence is therefore less about raw performance or scaling, and more about an architectural limitation: knowledge is treated as an after-the-fact annotation on computation, rather than as an organizing substrate that shapes computation. This paper introduces Mindful Machines, a computational paradigm that operationalizes coherence as an architectural property rather than an emergent afterthought. A Mindful Machine is specified by a Digital Genome (encoding purposes, constraints, and knowledge structures) and orchestrated by an Autopoietic and Meta-Cognitive Operating System (AMOS) that runs a continuous Discover–Reflect–Apply–Share (D-R-A-S) loop. Instead of a static model embedded in a one-shot ML pipeline or deep learning neural network, the architecture separates (1) a structural knowledge layer (Digital Genome and knowledge graphs), (2) an autopoietic control plane (health checks, rollback, and self-repair), and (3) meta-cognitive governance (critique-then-commit gates, audit trails, and policy enforcement). We validate this approach on the classic Credit Default Prediction problem by comparing a traditional, static Logistic Regression pipeline (monolithic training, fixed features, external scripting for deployment) with a distributed Mindful Machine implementation whose components can reconfigure logic, update rules, and migrate workloads at runtime. The Mindful Machine not only matches the predictive task, but also achieves autopoiesis (self-healing services and live schema evolution), explainability (causal, event-driven audit trails), and dynamic adaptation (real-time logic and threshold switching driven by knowledge constraints), thereby reducing the coherence debt that characterizes contemporary ML- and LLM-centric AI architectures. The case study demonstrates “a hybrid, runtime-switchable combination of machine learning and rule-based simulation, orchestrated by AMOS under knowledge and policy constraints”. Full article

This study examines the desirable public debt threshold for African economies and the effect of foreign direct investment (FDI) on economic growth, using secondary data from 1995 to 2019. The analysis employed panel-data threshold regression, and the results indicate that the debt threshold desirable for economic growth ranges from 22% to 85% of GDP, depending on the kind of model employed. Also, the results conclusively show that FDI always has a negative effect on economic growth when the economy operates below the bottom-debt threshold, with the negative FDI coefficient remaining significant across most of the analysis. It is thus crucial for policymakers to continue pursuing policies that encourage debt financing for major infrastructure projects that drive increased industrialization. This will also help to increase the local economies’ attractiveness to foreign investment and ensure that the FDI will only further boost economic growth and development. Full article

Egypt has experienced a sharp rise in external debt over the past decade, increasing from USD 55.8 billion in 2015 to over USD 165.3 billion by 2023. Despite maintaining a debt-to-GDP ratio within internationally accepted thresholds (approximately 45% in 2023), the country faces mounting economic distress, including foreign exchange shortages, currency depreciation, and rising debt-servicing burdens. This study argues that Egypt’s crisis stems not from excessive borrowing but from ineffective debt management, particularly the misalignment between debt maturities and the economic returns of financed projects. Using annual data from 2010 to 2023—a period deliberately selected to capture Egypt’s post-2011 political and economic transition—the analysis applies a Vector Autoregression (VAR) model and Granger causality test to explore short-term interactions between short-term and long-term external debt, the exchange rate, and foreign reserves. While the small sample size limits long-term econometric inference, it provides meaningful insights into short-term debt dynamics and liquidity pressures characteristic of Egypt’s current economic phase. The results show that short-term debt exerts significant depreciative pressure on the currency, while long-term debt weakly undermines reserves when tied to non-revenue-generating projects. Policy recommendations emphasize improving debt maturity alignment, enhancing transparency, and linking debt servicing to productive investments. Full article

This paper estimates a nonlinear asymmetric dynamics model in the threshold panel data framework to study the extent to which the quality of governance, investment, and financial stability affect the impact of external debt on economic growth in 47 African countries from 2002 to 2022. As a general approach, we use the first-differenced GMM estimator, which allows both threshold variables and regressors to be endogenous. The results confirm that external debt becomes a drag on growth beyond a threshold of 53.49% relative to GDP. Furthermore, the results show that external debt appears to stimulate economic growth mainly by orienting it towards productive investment. In addition, the results show that better governance quality and financial stability accentuate the positive impact of external debt on economic growth. Based on the findings, this study proposes several policy recommendations. Full article

Change points caused by extreme events in global economic markets have been widely studied in the literature. However, existing techniques to identify change points rely on subjective judgments and lack robust methodologies. The objective of this paper is to generalize a novel approach that leverages topological data analysis (TDA) to extract topological features from time series data using persistent homology. In this approach, we use Taken’s embedding and sliding window techniques to transform the initial time series data into a high-dimensional topological space. Then, in this topological space, persistent homology is used to extract topological features which can give important information related to change points. As a case study, we analyzed 26 stocks over the last 12 years by using this method and found that there were two financial market volatility indicators derived from our method, denoted as $L_1$ and $L_2$. They serve as effective indicators of long-term and short-term financial market fluctuations, respectively. Moreover, significant differences are observed across markets in different regions and sectors by using these indicators. By setting a significance threshold of 98 % for the two indicators, we found that the detected change points correspond exactly to four major financial extreme events in the past twelve years: the intensification of the European debt crisis in 2011, Brexit in 2016, the outbreak of the COVID-19 pandemic in 2020, and the energy crisis triggered by the Russia–Ukraine war in 2022. Furthermore, benchmark comparisons with established univariate and multivariate CPD methods confirm that the TDA-based indicators consistently achieve superior F1 scores across different tolerance windows, particularly in capturing widely recognized consensus events. Full article

Background/Objectives: Parvovirus B19 (B19V) is a non-enveloped single-stranded DNA virus transmissible by blood transfusion, with potentially severe outcomes in immunocompromised and pregnant recipients. In this study, we investigated the B19V prevalence in 441,084 blood donations from Salzburg, Austria, collected between 2012 and 2024, focusing on changes in epidemiological dynamics before, during, and after the SARS-CoV-2 pandemic. Additionally, the B19VB19V persistence and its implications for deferral policies were assessed. Methods: Donor samples were screened for B19VB19V DNA by qPCR (2012–2024) and for SARS-CoV-2 total anti-N antibodies (2020–2024). B19VB19V prevalence rates, cycle threshold (Ct) values, and seasonal distribution were compared between pre-pandemic, pandemic, and post-pandemic phases. Follow-up testing of initially B19VB19V-positive donors was performed after a 2-year deferral period. Results: The B19VB19V positivity rate of 0.13% (2012–2019) significantly decreased to 0.02% during the SARS-CoV-2 pandemic (2020–2022). A substantial increase occurred post-pandemic, with prevalence reaching 1.47% in 2024. Significant lower Ct values were observed in the post-pandemic phase, indicating higher viral loads. Additionally, younger donors (aged 18–45 years) showed significantly lower Ct values. After a 2-year deferral, 39% of re-tested donors remained B19VB19V DNA-positive. Conclusions: B19VB19V circulation increased substantially after the SARS-CoV-2 pandemic. Our observation is consistent with international reports and is likely due to an ‘immunity debt’ that has been accumulated due to pandemic-related public health interventions. Targeted B19VB19V screening and strict deferral strategies may be warranted particularly during outbreak periods to protect high-risk transfusion recipients. Full article

Board gender diversity (BGD) has gained attention as a governance mechanism that may influence corporate financial decisions. However, empirical evidence from Latin America and the Caribbean (LAC) remains limited despite the region’s significant gender disparities in corporate leadership and distinct institutional characteristics. This study examines how BGD affects capital structure decisions in LAC firms, drawing on agency theory and resource dependency theory. We analyze a panel dataset of 403 firms from 2015 to 2022, sourced from the London Stock Exchange Group database, using fixed effects models with Driscoll–Kraay standard errors to control for firm heterogeneity and econometric concerns. Results show that BGD is significantly and negatively associated with leverage ratios, with a one percentage point increase in female board representation corresponding to a 0.15 to 0.25 percentage point decrease in debt-to-capital ratios. This relationship is robust across multiple specifications and exhibits threshold effects, with stronger impacts when female representation reaches 20% or higher. The negative association is more pronounced for larger firms, consistent with enhanced governance benefits in complex organizations. Our findings suggest that gender-diverse boards exercise more effective oversight of financial decisions, leading to more conservative capital structures in emerging markets where governance mechanisms are particularly important for firm credibility and stakeholder confidence. Full article

This study investigates the nexus between leverage and financial performance in a sample of 54 Moroccan agricultural small- and medium-sized enterprises (SMEs) over the period of 2017–2022. Drawing on trade-off, pecking order, and agency theories, this analysis examines whether different levels of indebtedness influence performance, as measured by return on assets (ROA). Using panel data regression models, both linear and nonlinear specifications were tested to explore the potential curvature of the leverage–performance relationship. The empirical results reveal a significant and negative linear relationship between both short-term and long-term leverage and ROA, suggesting that increased indebtedness impairs financial performance. A quadratic specification reveals a persistently negative effect of short-term leverage and a U-shaped relationship between long-term leverage and ROA, indicating that performance may improve beyond certain debt thresholds. To address endogeneity concerns and validate the findings, dynamic panel estimation using the generalized method of moments (GMM) was employed, confirming the leverage’s adverse effects on performance. Thus, this study provides policy-relevant insights into optimal capital structure decisions for small agribusinesses and underscores the need for tailored financial strategies to support their sustainable development. Full article

In the process of evaluating the quality of a company’s development, the issues related to production capacity and environmental pollution have emerged as significant concerns. Drawing on the methodologies employed in previous related research, this study utilizes the Data Envelopment Analysis with relaxation variables and the Global Malmquist–Luenberger index to measure the green total factor productivity of Chinese heavy-polluting enterprises. The main findings of this study are as follows: (1) It is clearly demonstrated that higher managerial effectiveness has a substantial positive impact on the improvement of a company’s green total factor productivity; (2) the digitalization progress within enterprises serves as a moderating factor in the relationship between managerial effectiveness and green total factor productivity; (3) the extent of financial constraints acts as a mediating variable, intervening in the relationship between managerial efficiency and green total factor productivity; and (4) a threshold effect is detected between managerial effectiveness and the debt repayment pressure faced by enterprises. When the threshold values of managerial effectiveness or the quick ratio are surpassed, the influence of managerial effectiveness on the green total factor productivity of enterprises will undergo a change. Full article

Achieving sustainable economic growth requires a careful balance between public debt accumulation and the macroeconomic stability necessary for long-term development. While public debt can support growth through productive public investment, excessive debt may crowd out private investment, raise borrowing costs, and undermine financial stability, ultimately threatening economic sustainability. In this context, the quality of institutions plays a pivotal moderating role by fostering responsible debt management and ensuring that debt-financed investments contribute to sustainable development. In this context, this study investigates the relationship between public debt and economic growth, with a focus on the moderating role of institutional quality (IQ). Utilizing an unbalanced panel of 115 countries over the period from 1996 to 2021, this study tests the hypothesis that robust institutional frameworks mitigate the negative impact of public debt on economic growth. To address potential endogeneity, this study employs the dynamic system Generalized Method of Moments (GMM) estimation technique. The results reveal that, although the direct effect of public debt on economic growth is negative, the interaction between public debt and IQ yields a positive influence. Furthermore, the results indicate the presence of a threshold beyond which public debt begins to exert a beneficial effect on economic growth, whereas its impact remains adverse below this threshold. These findings underscore the critical importance of sound debt management strategies and institutional development for policymakers, suggesting that effective government governance is essential to harnessing the potential positive effects of public debt on economic growth. Full article