Volume 32 (2022): Edizione 1 (March 2022)

Current theories support an inverse relationship between the expected return on investment and the associated risk. The DCF valuation method highlights the fact that the value of the company is given by the ratio between the excess cash (at the numerator) and the risk assimilated by the capitalization rate (at the denominator). The modern portfolio theory MPT considers that the proportion of recommended securities is on a parabola in mean-variance space, the risk being assimilated to uncertainty. Practitioners assess the target and the risk (take profit/stop loss) based on the methods of technical analysis. We appreciate that these theories are divergent from each other, disconnected and therefore difficult to unify. Our approach, based on the probabilities associated with each level of future quotations, eliminates the disadvantages of current theories. The answer found is to try to establish as realistically as possible what the chances are that, over a certain period of time, a title will have a certain quotation (or be in a certain range). For reasons somewhat similar to those of sports betting, the conclusion that emerges from the article is that this approach, if well developed, gives superior results to those currently used. In subsequent studies, forecasting methods are to be developed, because we consider them the most important in the investment process.

The study analyzed the impact of monetary policy shocks on economic growth in 12 countries of the Economic Community of West African States (ECOWAS), using quarterly data from 1980(1) to 2017(4). We employed a Panel Structural Vector Autoregressive (Panel SVAR) for the modeling of monetary policy transmission shock in the segregated sub-regions of WAMZ and WAEMU. The key results suggest that fluctuations of the monetary policy do not have significant effects on the economic growth but significantly impact the general price level. Moreover, the study finds that the exchange rate is persistently a vital mechanism that significantly influences the variables of the real economy. Our estimates further suggest that there is idiosyncratic evidence found in the results, which is the anomaly of the Price puzzle.

The aim of the study is to assess the current impact of the Covid-19 pandemic on the level of household income in modern national economies according to data for 2020. The assessment of five indicators that characterize the opinions of adults living in different countries about a strong decrease, a small decrease, preservation, a small increase and a strong increase in their income in 2020 was considered. The initial data were the results of a survey of the economically active population in 43 countries, in the process of implementing the Global Entrepreneurship Monitoring project. The five indicators were evaluated using the density functions of the normal distribution. It is proved that for the majority (53%) of households, due to the pandemic, there was a decrease in household income. It shows the preservation of income in a significant (40%) number of households in the countries under consideration. It is shown that the increase in income in 2020 was observed only in a small number (less than 4%) of households. It is proved that the values of each of the five indicators under consideration had a significant differentiation by country. The results of our work have a certain theoretical and practical significance for governments and the economically active population. The methodological approach presented in the article can be used to assess the impact of the Covid-19 pandemic on household income in 2021.

This study investigated Nigeria's economic interactions with China, India, and the USA with a view to identifying the main source of real output shock to Nigeria in the period 1981Q1-2019Q4. The analysis followed the network approach of Diebold and Yilmaz (2014), which uses the size and direction of normalized generalized forecast error variance decompositions (NGFEVD) of a vector error correction model to track shock propagation among economic entities. The results indicate that China and India are net transmitters of real output shocks to Nigeria. The results also indicate that Nigeria is a net real output shock receiver. The study concludes that Nigerian policymakers should evolve policies that can insulate the economy against real output shock heatwaves from around the world, especially China and India. Such policies should mainly target the diversification of the economy such that crude oil will no longer be the only major source of revenue.

The paper examines the Environmental Kuznets Curve (EKC) model in the panel of the most complex economies in the world by considering the ecological footprint as an indicator of environmental degradation and economic complexity - as a variable of interest and expression of structural changes in the economy. The study includes the first 48 complex economies in the world, with positive averages of the Economic Complexity Index (ECI) for 1995-2017. The model of cointegrating polynomial regression (CPR) includes also variables with impact on ecological footprints such as globalization, energy intensity and urbanization. The EKC model is validated in the panel of the 48 complex economies, suggesting that these countries have already reached a development stage enabling them to curb the increasing pollution expressed by ecological footprint. Globalization has a mitigating effect while urbanization and energy intensity have an extension effect on ecological footprint. Policy implications are also included.