Financial stability in G-20 economies
Asymmetric effects of institutional quality, economic policy uncertainty, and oil price shocks
Bibliographic Data
| ID | 6454835 |
|---|---|
| Authors | Faroque Ahmed (0000-0002-8434-1536), Kazi Sohag (0000-0002-0976-2357), Oleg Mariev (0000-0002-9745-8434), Monirul Islam (0000-0003-0045-3897), Md Monirul Islam (0000-0001-5875-433X) |
| Year | 2025 |
| Volume | 10 |
| Pages | 100962-100962 |
| Publication date | 2025-07-04 |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Sustainable Futures (JOURNAL) |
| Journal identifiers | ISSN: 2666-1888 |
| Publisher | Elsevier BV (PUBLISHER) |
| DOI | 10.1016/j.sftr.2025.100962 |
| OpenAlex | W4412027182 |
| Language | EN |
| Citations received | 1 |
| References cited | 104 |
After the global financial crisis, the tricky interconnectedness among the global financial markets become apparent. We investigate the impact of Economic Policy Uncertainty (EPU), and distinct oil price shocks on the financial stress (FSI) of G-20 to see how financial instability dynamically reacts to these external risks and whether the Institutional Quality (InQ) has any moderating impact on the financial stress of G-20 in presence of these risks. Utilizing a monthly panel dataset from January 2000 to December 2023, we apply the Methods of Moments Quantile Regression (MMQR) and Dynamic Common Correlated Effects Mean Group (DCCEMG) approaches to obtain reliable and robust estimates. Our findings indicate that EPU, volatility in oil price (OVX), oil price demand and risk shocks intensify financial stress, while an increase in oil supply and improved institutional quality alleviate financial stress of G-20. More importantly, we identify that InQ can moderate the impact of EPU on financial stress in G-20 countries. This occurs through mechanisms such as increased policy credibility, regulatory transparency, and institutional checks that reduce market overreaction to uncertain policy environments. While EPU can also moderate oil price shocks impact on FSI of G-20. Notably, countries like China, Japan, and South Korea appear to be resilient to EPU, whereas Germany, Italy and Turkiye are found to be most exposed to oil price demand and risk shocks. This study carries significant policy implications for both market participants and policymakers of G-20
Economic stability · Economics · Financial stability · Financial system · Macroeconomics · Monetary economics · Oil price · Stability (learning theory · Energy, Environment, Economic Growth · Market Dynamics and Volatility · Monetary Policy and Economic Impact · Finance
Irreversibility, Uncertainty, and Cyclical Investment
Efficient Inference in a Random Coefficient Regression Model
Rules, discretion and reputation in a model of monetary policy
Assessing cross-sectional correlation in panel data
Quantiles via moments
Common correlated effects estimation of heterogeneous dynamic panel data models with weakly exogenous regressors
Panel cointegration tests of the Fisher effect
Institutional causes, macroeconomic symptoms
Not All Oil Price Shocks Are Alike
Effect of foreign direct investments, economic development and energy consumption on greenhouse gas emissions in developing countries
General Diagnostic Tests for Cross Section Dependence in Panels
The Lagrange Multiplier Test and its Applications to Model Specification in Econometrics
Measuring Economic Policy Uncertainty
Estimation and Inference in Large Heterogeneous Panels with a Multifactor Error Structure
Testing slope homogeneity in large panels
Regression Quantiles
A simple panel unit root test in the presence of cross‐section dependence
Why Nations Fail
Institutions, Institutional Change and Economic Performance
An Uncertainty Thermometer to Measure the Macroeconomic‐Financial Risk in South American Countries
Providing social assistance and humanitarian relief
Government attenuation of institutional inefficiencies in capital markets
Rethinking energy poverty alleviation through financial inclusion
Law and Finance
Appreciation and Interest
| Citations per year | 1 |
|---|---|
| Citation span | 2025 - 2025 (1) |
| Highly cited | No |