International Journal of Econometrics and Financial Management

ISSN (Print): 2374-2011

ISSN (Online): 2374-2038

Editor-in-Chief: Tarek Sadraoui




Bond Markets and Financial Stability: Evidence from the Asian Experience

1Avicenne Private Business School Tunisia

2Higher Institute of Business Administration Tunisia

International Journal of Econometrics and Financial Management. 2016, 4(1), 17-28
doi: 10.12691/ijefm-4-1-3
Copyright © 2016 Science and Education Publishing

Cite this paper:
Mourad Hmida, Mohsen Bensalem Brahmi. Bond Markets and Financial Stability: Evidence from the Asian Experience. International Journal of Econometrics and Financial Management. 2016; 4(1):17-28. doi: 10.12691/ijefm-4-1-3.

Correspondence to: Mourad  Hmida, Avicenne Private Business School Tunisia. Email:


Since the advent of the financial crisis of 1997-98, the development of bond markets in Asia is the center of interest of the governments of the region. This effort reflects the prevalent view recently emphasized the importance of domestic bond markets in the prevention of financial fragility in an open capital flows context. The aim of this article is to investigate about the nature and mechanisms of the links between the development of bond markets and financial stability. The analysis focuses on the experience of nine Asian countries over the period 1997 - 2009. The tests cover specific aspects of the development of a bond market hand, and financial stability indicators of capital adequacy, asset quality and profitability in the other hand. The empirical study reveals a significant role of the domestic bond markets in reducing financial vulnerability of the region.



[1]  Kaminsky, G. L., & Schmukler, S. L. (2008). Short-run pain, long-run gain: Financial liberalization and stock market cycles*. Review of Finance, 12(2), 253-292.
[2]  Modigliani, F., & Miller, M. H. (1958). The cost of capital, corporation finance and the theory of investment. The American economic review, 48(3), 261-297.
[3]  Levine, R. (2000). Bank-based or market-based financial systems: which is better?. University of Minnesota, mimeo.
[4]  Stiglitz, J. E. (1985). Credit markets and the control of capital. Journal of Money, credit and banking, 17(2), 133-152.
[5]  Levine, R. (2002). Bank-based or market-based financial systems: which is better?. Journal of financial intermediation, 11(4), 398-428.
Show More References
[6]  Kumar, K. B., Rajan, R. G., & Zingales, L. (1999). What determines firm size? (No. w7208). National Bureau of Economic Research.
[7]  Shleifer, A., & Vishny, R. W. (1997). A survey of corporate governance. The journal of finance, 52(2), 737-783.
[8]  Grossman, S. J., & Hart, O. D. (1980). Takeover bids, the free-rider problem, and the theory of the corporation. The Bell Journal of Economics, 42-64.
[9]  DeAngelo, H., & Rice, E. M. (1983). Antitakeover charter amendments and stockholder wealth. Journal of Financial Economics, 11(1-4), 329-359.
[10]  Jensen, M. C. (1993). The modern industrial revolution, exit, and the failure of internal control systems. the Journal of Finance, 48(3), 831-880.
[11]  Allen, F., & Gale, D. (2000). Comparing financial systems. MIT press.
[12]  Chakraborty, S., & Ray, T. (2007). The development and structure of financial systems. Journal of Economic Dynamics and Control, 31(9), 2920-2956.
[13]  Shleifer, A., & Summers, L. H. (1988). Breach of trust in hostile takeovers. InCorporate takeovers: Causes and consequences (pp. 33-68). University of Chicago Press.
[14]  Bhide, A. (1993). The hidden costs of stock market liquidity. Journal of financial economics, 34(1), 31-51.
[15]  Acemoglu, D., & Zilibotti, F. (1997). Was Prometheus unbound by chance? Risk, diversification, and growth. Journal of political economy, 105(4), 709-751.
[16]  Hmida, M. (2014). Financial Contagion Crisis Effect of Subprime on G7: Evidence through the Adjusted Correlation Test and Non-linear Error Correction Models (ECM). International Journal of Econometrics and Financial Management, 2(5), 180-187.
[17]  Hmida, M. (2014). The financial contagion effects of the subprime crisis on BRIC countries. International Journal of Managerial and Financial Accounting,6(3), 175-188.
[18]  Boot, A. W., & Thakor, A. V. (2000). Can relationship banking survive competition?. The journal of Finance, 55(2), 679-713.
[19]  Weinstein, D. E., & Yafeh, Y. (1998). On the costs of a bank‐centered financial system: Evidence from the changing main bank relations in Japan. The journal of Finance, 53(2), 635-672.
[20]  Dewatripont, M., & Maskin, E. (1995). Credit and efficiency in centralized and decentralized economies. The Review of Economic Studies, 62(4), 541-555.
[21]  Black, S. W., & Moersch, M. (1998). Financial structure, investment and economic growth in OECD countries. ADVANCES IN FINANCE INVESTMENT AND BANKING, 5(1), 157-174.
[22]  Wenger, E., & Kaserer, C. (1998). German banks and corporate governance: A critical view. Comparative Corporate Governance-The State of the Art and Emerging Research, 499-536.
[23]  Rajan, R. G., & Zingales, L. (2003). Banks and markets: The changing character of European finance.
[24]  Caprio, G., & Levine, R. (2002). Corporate governance in finance: Concepts and international observations. Financial sector governance: The roles of the public and private sectors, 17-50.
[25]  Haber, S. (2005). Mexico’s experiments with bank privatization and liberalization, 1991–2003. Journal of Banking & Finance, 29(8), 2325-2353.
[26]  Arestis, P., Luintel, A. D., & Luintel, K. B. (2004). Does financial structure matter?.
[27]  Billmeier, A., & Massa, I. (2009). What drives stock market development in emerging markets—institutions, remittances, or natural resources?. Emerging Markets Review, 10(1), 23-35.
[28]  Demirgüç-Kunt, A., & Maksimovic, V. (1996). Stock market development and financing choices of firms. The World Bank Economic Review, 10(2), 341-369.
[29]  Krugman, P. R., Dominquez, K. M., & Rogoff, K. (1998). It's baaack: Japan's slump and the return of the liquidity trap. Brookings Papers on Economic Activity, 1998(2), 137-205.
[30]  Chinn, M. D. (1997). Paper pushers or paper money? Empirical assessment of fiscal and monetary models of exchange rate determination. Journal of Policy Modeling, 19(1), 51-78.
[31]  Chinn, M. D., & Dooley, M. P. (1999). International monetary arrangements in the Asia-Pacific before and after. Journal of Asian Economics, 10(3), 361-384.
[32]  Wade, R., & Veneroso, F. (1998). The Asian crisis: the high debt model versus the Wall Street-Treasury-IMF complex. New Left Review, (228), 3.
[33]  Fan, J. P., & Wong, T. J. (2005). Do external auditors perform a corporate governance role in emerging markets? Evidence from East Asia. Journal of accounting research, 43(1), 35-72.
[34]  Bikker, J. A., & Metzemakers, P. A. J. (2002). „Bank provisioning behavior and procyclicality‖, DNB Staff Reports, Nr. 111.
[35]  Quagliariello, M. (2003). Macroeconomics indicators useful in predicting bank loan quality? Evidence from Italy, Rome: Bank of Italy.
[36]  Babihuga, R. (2007). Macroeconomic and financial soundness indicators: an empirical investigation (No. 7-115). International Monetary Fund.
Show Less References


A New Cointegration Econometric Analysis for Contagious and Volatility Spillovers of Subprime Crisis Effects

1Department of Quantitative Methods, Faculty of economic sciences and Management of Mahdia

2Department of Quantitative Methods, Higher Institute of Society Administration

International Journal of Econometrics and Financial Management. 2016, 4(2), 29-38
doi: 10.12691/ijefm-4-2-1
Copyright © 2016 Science and Education Publishing

Cite this paper:
Tarek Sadraoui, Bechir Deghachi, Rahma Ben Aissa. A New Cointegration Econometric Analysis for Contagious and Volatility Spillovers of Subprime Crisis Effects. International Journal of Econometrics and Financial Management. 2016; 4(2):29-38. doi: 10.12691/ijefm-4-2-1.

Correspondence to: Tarek  Sadraoui, Department of Quantitative Methods, Faculty of economic sciences and Management of Mahdia. Email:,


We examine spillover effects of the recent U.S. financial crisis on five emerging Asian countries by estimating conditional correlations of financial asset returns across countries using multivariate GARCH models. We propose a novel approach that simultaneously estimates the conditional correlation coefficient and the effects of its determining factors over time, which can be used to identify the channels of spillovers. We find a dominant role of foreign investment for the conditional correlations in international equity markets. The dollar Libor OIS spread, the sovereign CDS premium, and foreign investment are found to be significant factors affecting foreign exchange markets.



[1]  Akerlof, G.A. and Shiller, R.J. (2009) Animal Spirits, How Human Psychology Drives the Economy, and Why it Matters for Global Capitalism, Princeton University Press.
[2]  Ayadi, M., Boudhina, R., Khallouli, W. and Sandretto, R. (2006) ‘La contagion de la crise asiatique: Dynamiques de court terme et court terme et de long terme’, Économie internationale, Vol. 105, pp.113-135.
[3]  Climent, F. and Meneu, V. (2003) ‘Has 1997 Asian crisis increased information flows between international markets’, International Review of Economics and Finance, Vol. 12, pp.111-143.
[4]  Paul R. Masson, 1999. “Multiple Equilibria, Contagion, and the Emerging Market Crises,” IMF Working Papers 99/164, International Monetary Fund.
[5]  Roberto Rigobon, 2000. “Identification through Heteroskedasticity: Measuring “Contagion: betweenArgentinean and Mexican Sovereign Bonds,” NBER Working Papers 7493, National Bureau of Economic Research, Inc.
Show More References
[6]  Kristin Forbes & Roberto Rigobon, 2000. “Contagion in Latin America: Definitions, Measurement, and Policy Implications,” NBER Working Papers 7885, National Bureau of Economic Research, Inc.
[7]  Horta, P. A., Amancio, C. E., Coimbra, C. S. & Oliveira, E. C. 2001. Considerações sobre a distribuição e origem da flora de macroalgas marinhas brasileiras. Hoehnea, 28: 243-265.
[8]  Lee, H. K. (2012). Cases for the nugget in modeling computer experiments. Statistics and Computing, 22(3), 713-722.
[9]  Escribano, A. and Pfann, A.G. (1998) ‘Non-linear error correction, asymmetric adjustment and cointegration’, Economic Modelling, Vol. 15, No. 2, pp.197-216.
[10]  Engele, R.F. and Granger, C.W.J. (1987) ‘Co-integration and error correction: representation, estimation and testing’, Econometrica, Vol. 55, pp.251-276.
[11]  Favero, C.A. and Giavazzi, F. (2002) ‘Is the international propagation of financial shocks non-linear? Evidence from the ERM’, Journal of International Economics, Vol. 57, No. 1, pp.231-246.
[12]  Forbes, K. and Rigobon, R. (2001) ‘Contagion in Latin America: definition, measurement, and policy implications’, MIT Sloan School of Management and NBER, Janvier, Vol. 17.
[13]  Fry, R., Martin, V. and Tang, C. (2008a) ‘A new class of tests of contagion with applications’, International Workshop on Contagion and Financial Stability, 30 May, Paris, available via Banque de France at http://www.banquefrance.
[14]  Fry, R., Martin, V.L. and Tang, C. (2008b) ‘A new class of tests of contagion with applications to real estate markets’, CAMA Working Paper Series 1/2008.
[15]  Granger, C.W.J. and Lee, T.H. (1987) ‘Investigation of production, sales and non-symmetric error correction models’, Journal of Applied Econometrics, Vol. 4, pp.145-159, Supplement.
[16]  Horta, P., Mendes, C. and Vieira, I. (2008) ‘Contagion effects of the US subprime crisis on developed countries’, CEFAGE-UE Working Papers 2008_08, University of Evora, CEFAGE-UE, Portugal.
[17]  Horta, P., Mendes, C. and Vieira, I. (2009) ‘Contagion effects of the subprime crisis in the European Nyse-Euronext’, CEFAGE-UE Working Papers 2009_01, University of Evora, EFAGE-UE, Portugal.
[18]  Kwiatkowski, D., Phillips, P.C.B., Schmidt, P. and Shin, Y. (1992) ‘Testing the null hypothesis of stationarity against the alternative of a unit root: how sure are we that economic time series have a unit root?’, Journal of Econometrics, Vol. 54, Nos. 1-3, pp.159-178, Elsevier.
[19]  Lewis, M.K. (2009) ‘The origins of the sub-prime crisis: inappropriate policies, regulations, or both?’, Accounting Forum, Vol. 33, pp.114-126.
[20]  MacKinnon, J.G. (1994) ‘Approximate asymptotic distribution functions for unit-root and Cointegration tests’, Journal of Business & Economic Statistics, Vol. 12, No. 2, pp.167-176, American Statistical Association.
[21]  Masson, P.R. (1999) ‘Contagion: macroeconomic models with multiple equilibria’, Journal of International Money and Finance, Vol. 18, No. 4, pp.587-602.
Show Less References


Investigating Method on Client Contentment in Hotel Sector: A Case Study of the Mariador Palace Hotel

1School of Mathematics and Statistics, Central China Normal University, 152 Luoyu Avenue, Wuhan, Hubei, P.R. China

2School of Economics, Central China Normal University

International Journal of Econometrics and Financial Management. 2016, 4(2), 39-47
doi: 10.12691/ijefm-4-2-2
Copyright © 2016 Science and Education Publishing

Cite this paper:
Alhassane Touré, Zuo Guoxin, Sory Kaba. Investigating Method on Client Contentment in Hotel Sector: A Case Study of the Mariador Palace Hotel. International Journal of Econometrics and Financial Management. 2016; 4(2):39-47. doi: 10.12691/ijefm-4-2-2.

Correspondence to: Zuo  Guoxin, School of Mathematics and Statistics, Central China Normal University, 152 Luoyu Avenue, Wuhan, Hubei, P.R. China. Email:


Today, we live in a world where the development of the country is partly dependent on the building of hotels. Hence, this is considered as a very important factor. The purpose of this study is to investigate the concept of client contentment in the hotel sector. In carrying out this study, the Mariador Palace was selected, and a study was conducted on 200 clients of this company. They were interviewed to answer a questionnaire which was used as a sample for the client contentment. In addition, some investigation method was used. From the results of this study, we have found that adopting client contentment concept in the Mariador palace Hotel will be a positive contribution in achieving objectives, getting client’s acquisition, maintaining retention, and decreasing client’s loss. This study recommends that the Mariador palace hotel should be based more on the development of the nature of their services, treatment of customer’s complaints, and obtaining feedback from clients who are loyal in patronizing the hotel. Thus, this is with the view of improving the quality of their service delivery again.



[1]  Alan Clarke & Wei Chen. International hospitality management: concepts and cases, MPG books Ltd, Great Britain, 6(12), 2007. [Online].
[2]  Bradley, N. Marketing Research: tools and techniques, Oxford University Press Inc., New York. (2007).
[3]  Chisnall, P. Marketing Research, 6th ed. McGraw-Hill, Berkshire. (2001).
[4]  Edvardsson, B., Johnson, M. D., Gustafsson, A., & Strandvik, T. The effects of satisfaction and loyalty on profit and growth: products versus services. Total Quality Management, 11, 917 -927. (2000).
[5]  Hart, C.W.L., Heskett, J.L. and Sasser, E.W. Jr. The profitable art of service recovery, Harvard Business Review, Vol. 68 No. 4, (1990).
Show More References
[6]  Gale, B. Monitoring Customer Satisfaction and Market Perceived Quality, Worth Repeating Series, No. 922CS01, American Marketing Association, Chicago, IL. (1992).
[7]  [Online].available:
[8]  Jones, T.O. and Sasser, W.E. Jr. Why satisfied customers defect, Harvard Business Review, Vol. 73, November-December, pp. 88-99. (1995).
[9]  Kothari C.R .Research Methodology: Methods & Techniques, Mcmillan. (2000:149).
[10]  Kotler, P. Marketing Management. New Jersey: Prentice-Hall, Inc. (2000).
[11]  Levesque, T. and McDougall, G.H.G. Determinants of customer satisfaction, International Journal of Bank Marketing, Vol. 14 No. 7. (1996).
[12]  Lewis, R.C. The measurement of gaps in the quality of hotel services, International Journal of Hospitality Management, Vol. 6 No. 2. (1987). [Online]
[13]  Oliver, R.L. Measurement and evaluation of satisfaction process in retail setting, Journal of Retailing, Vol. 57. (1981).
[14]  Parasuraman, A., Zeithaml, V.A. and Berry, L.L. SERVQUAL: a multiple-item scale for measuring consumer perceptions of service quality, Journal of Retailing, Vol. 64, Spring, pp. 2-40. (1988)
[15]  Parker, C., and Mathews, B.P. Customer satisfaction: contrasting academic and consumers' interpretations, Marketing Intelligence and Planning, 19/1. (2001).
[16]  Patton, M. Qualitative Research & Evaluation Methods (3ed.). Thousand Oaks: Sage Publication. (2002).
[17]  Ravald, A. and Grönroos, C. The value concept and relationship marketing», European Journal of Marketing, Vol. 30 No. 2, pp. 19-30. (1996).
[18]  Roger Hallowell. The relationships of customer satisfaction, customer loyalty, and profitability: an empirical study, International Journal of Service Industry Management, Vol. 7 No. 4. (1996). [Online].available:
[19]  Werth, J. Customer satisfaction measurement, complying with the ISO 9001:2000 requirement, available at (2002).
[20]  Zeithaml, V.A. Consumer perceptions of price, quality, and value: a means-end model and synthesis of evidence”, Journal of Marketing, Vol. 52, July. (1988).
[21]  Zeithaml, V., Bitner, M. & Gremler, D. Services Marketing integrating Customer Focus across the Firm, 5th ed. McGraw-Hill International Edition, Singapore. (2009).
Show Less References