Given the devastating effects of global warming, the problem of human-induced climate change, and in particular carbon dioxide emissions, has been high on the global policy agenda. In this study, we examine the relationship between national culture, carbon dioxide emissions, and economic growth in the framework of the Environmental Kuznets Curve (EKC). Applying system GMM panel estimator across 69 developed and developing countries, we confirm the existence of EKC and show that culture significantly affects the income-emission relationship. Moreover, the effects of the six cultural dimensions on EKC can be collapsed into two: (i) masculinity, power distance and indulgence move the EKC upward and shift the income turning point to the left; and (ii) individualism, uncertainty, and long-term orientation move the EKC downward while shifting the income turning point to the right. The impact of culture on EKC remains also robust for alternative specifications. Future policy and global initiatives in sustainable development should incorporate the multidimensional impact of culture on national behavior towards environment and economic growth, a relationship that has been largely ignored in economic decision-making models.

This study seeks to examine whether corporate environmental performance (CEP) and corporate social performance (CSP) affect stability of the banking industry. The topic is of much interest to researchers and policy makers considering the growing demand to integrate environmental and social practices into banking business model. Based on a panel dataset of 473 banks in 74 countries, this research finds that CEP is negatively related to bank stability as measured by non-performing loans (NPL). However, the impact is insignificant for small and large banks, as well as for banks in countries with low environmental scores. Furthermore, CSP does not appear to have a significant relationship with bank stability, but financial product safety, which is an aspect of CSP, does. The results are robust to a variety of econometric specifications and have significant policy implications for investors, bankers and regulators.

This study assesses the role of gold, crude oil and cryptocurrency as a safe haven for traditional, sustainable, and Islamic investors during the COVID-19 pandemic crisis. Using Wavelet coherence analysis and spillover index methodologies in bivariate and multivariate settings, this study examines the correlation of these assets for different investment horizons. The findings suggest that gold, oil and bitcoin exhibited low coherency with each stock index across almost all considered investment horizons until the onset of the COVID-19. Conversely, with the outbreak of the pandemic, the return spillover is more intense across financial assets, and a significant pairwise return connectedness between each equity index and hedging asset is observed. Hence, gold, oil, and bitcoin do not exhibit safe-haven characteristics. However, by decomposing the time-varying co-movements into different investment horizons, we find that total and pairwise connectedness among the assets are primarily driven by a higher-frequency band (up to 4 days). It indicates that investors have diversification opportunities with gold, oil, and bitcoin at longer horizons. The results are robust over different types of equity investors (traditional, sustainable, and Islamic) and various investment horizons.

While SMEs constitute the backbone of many economies, many SMEs have limited access to finance. Yet, banks in some countries are actively financing SMEs. This paper examines whether this is true in the case of Turkey, a G20 economy that has a significant SME sector. We study the determinants of banks' willingness to finance SMEs and banks' processing ability of SME financing portfolio in Turkey based on a unique quarterly small business panel data set of 40 commercial banks from 2006 to 2014. Employing pooled OLS and fixed-effects estimators, we find that Islamic banks (known as Participation banks in Turkey) are more inclined toward financing SMEs than conventional banks. We also find that the quality of Islamic banks' SME loan portfolio is comparable to that of conventional banks. The results are fairly robust to different bank ownership forms (state owned, private, and Islamic banks) and alternative model specifications. Our findings provide further support to the notion of 'small is the new big' in that banking for SMEs can be a viable venture.

Events such as the 'credit crunch', 'bank run', 'financial contagion', 'flight to quality' and 'systemic risks' have widely transpired in recent times. One important dimension permeating these events is the dynamic link between macroeconomic shocks and banks' behaviour. Economic crises experienced by five East Asian countries in the late 1990s were accompanied by financial sector problems. The Great Recession of the late 2000s also corresponded to heightened solvency risks affecting over-leveraged banks and financial institutions in many developed countries. In a world of imperfect information, adverse macroeconomic shocks could weaken firms' balance sheets, diminish bank capital and trigger financial disintermediation. Available in physical copy only (Call Number: BP 173.75 H236)

Have commodities and equity become a "financialized market of one"? Is such oneness persistent? Do diversification benefits still exist? Evidence behind these enquiries offers important insights for policymakers, governments, traders and investors, and constitutes the main motivation for this paper. To assess the viability of commodities as an alternative asset class for Islamic equity investors, we present evidence on the extent to which returns in commodities and Islamic equity markets move in sync in both time and frequency domains. Our findings reveal that, throughout the January 1999 - April 2015 period, correlations between commodities and Islamic equity were highly volatile and time sensitive. While there had been minimal correlation between commodities and Islamic equity prior to 2008, the relationship has strengthened since 2008, possibly attributed to the anomaly arising from the global financial crisis. Trends in the recent two years, however, suggest that the links between commodities and Islamic equity are heading towards their pre-crisis equilibrium, offering again potential diversification opportunities for investors. Divergence in correlations reveals that the behaviour of commodities is heterogeneous with varying potentials for diversification. Overall, gold, natural gas, soft commodities, grains and livestock are better portfolio diversifiers than oil and other metals. Relative to medium to long term investors, short-term investors gained better diversification benefits in most commodities during bullish, bearish and market recovery periods.

This paper investigates whether commodities offer potential diversification benefits for Islamic equity index investors in light of possible financialization of commodity markets. Using MGARCH-DCC and Wavelet Coherence analyses, our findings reveal that correlations between commodity markets and the Dow Jones Islamic Market World Index are time-varying and highly volatile throughout the January 1999 - April 2015 period. A substantial and persistent increase was observed in the return correlations between commodities and Islamic equity at the onset of the 2008 financial crisis. However, trends in the recent two years suggest that this association is heading towards its pre-crisis levels, offering again diversification benefits for Islamic equity holders. These benefits vary across different commodities in various time scales. Overall, gold, natural gas, soft commodities, grains and livestock are better portfolio diversifiers than oil and other metals. Relative to medium-to-long term investors, short-term investors (less than 32 days horizon) gained better diversification benefits in most commodities during bullish, bearish and market recovery periods. These findings have implications for investors who are heterogeneous in risk tolerance and time preference as well as for policymakers who are concerned with market stability.

The emergence of COVID-19 in late 2019 rapidly shattered the Asia-Pacific region (APR), a bastion of economic dynamism, and it became the epicenter of the global health crisis. This unprecedented pandemic not only triggered a public health catastrophe but also unleashed a financial storm, exposing vulnerability within the region's interconnected economies. This study identifies the factors driving volatility spillovers within Asian-Pacific financial markets during the initial wave of the COVID-19 pandemic (January 2020-February 2021). We analyze the interplay of pandemic transmission dynamics, government interventions, central bank policies, and socioeconomic variables. Our findings reveal a robust and persistent association between the rising number of COVID-19 cases per million and volatility spillovers. We introduce three novel determinants - the number of intensive care unit beds, population density, and the proportion of the elderly population - which significantly impact volatility transmission in response to new cases. Stringent government measures, such as travel bans and lockdowns, mitigate volatility spillovers. Conversely, central bank policies increase volatility spillovers. These insights contribute to a deeper understanding of financial market dynamics in the context of global health emergencies. This knowledge equips policy makers in the APR with valuable tools for navigating future crises.

There is a strong theoretical foundation that demonstrates costs of switching as one of the main barriers in creating a healthy level of competition. Switching costs might even be more prevalent for Islamic banks due to Shariah dimension since Shariah driven customers are limited to only switch to banks that offer Shariah-compliant products. However, the banking market is not completely segmented as Islamic banking clients can switch to conventional banks, and vice versa. This paper examines the degree of switching costs in Islamic and conventional banks, and investigates its influence on bank competition in dual banking economies. We find that conventional banks inherit higher switching costs than Islamic banks. The finding is consistent for all countries in the sample except for Malaysia and Bahrain. We also find that switching costs during the global financial crisis are higher than the rest of the years. We further document a significant negative relationship between switching costs and bank competition, while this relationship is more pronounced for Islamic banks.