Brief Report - (2025) Volume 13, Issue 2
Received: 03-Mar-2025, Manuscript No. economics-25-172319;
Editor assigned: 05-Mar-2025, Pre QC No. P-172319;
Reviewed: 19-Mar-2025, QC No. Q-172319;
Revised: 24-Mar-2025, Manuscript No. R-172319;
Published:
31-Mar-2025
, DOI: 10.37421/2375-4389.2025.13.515
Citation: Lie, Chen. ”Global Finance: Dynamics, Risks, Transformation.” J Glob Econ 13 (2025):515.
Copyright: © 2025 Lie C. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution
and reproduction in any medium, provided the original author and source are credited.
This study really gets into how financial crises spread across international markets. It highlights how interconnected banks are and the flow of capital, showing us what actually drives contagion when things go wrong globally. What this really means is that national financial health is increasingly tied to global vulnerabilities, making strong oversight crucial. This understanding is vital for mitigating widespread economic disruption [1].
Here's the thing: this research looks at how investing in companies focused on Environmental, Social, and Governance (ESG) factors plays out across different global markets. It finds that the impact of ESG on portfolio performance isn't always the same everywhere; it really depends on how developed the market is and how much investors care about these issues. This underscores the need for nuanced approaches to sustainable investing [2].
This paper dives deep into the emerging connection between cryptocurrencies, blockchain tech, and the broader international financial system. It explores what this all means for market efficiency, how we should regulate these new assets, and their potential effect on overall financial stability. It's a look at the future of finance, essentially, demanding adaptive regulatory frameworks [3].
This study looks at how decisions made by the US Federal Reserve on monetary policy don't just stay in the US. They actually spill over into global financial markets, particularly impacting capital flows and financial conditions in emerging market economies. It shows just how interconnected global finance truly is, requiring careful international policy coordination [4].
This research explores the link between countries opening up their financial markets and economic growth, especially in developing nations. What they found is that while financial integration can boost growth, it's not a given; it really depends on the quality of a country's institutions and how stable its economy is. Supportive domestic conditions are paramount for positive outcomes [5].
Let's break it down: this study examines how financial technology, or FinTech, is changing the stability of banking systems across different countries. It points out that while FinTech offers exciting new possibilities, it also introduces new kinds of risks that regulators and banks need to manage carefully to preserve financial stability [6].
This research explores how geopolitical events â?? things like political instability or conflicts â?? really shake up international financial markets. It specifically looks at how these risks affect returns across different types of assets, showing that geopolitical tensions aren't just political; they have direct economic consequences globally [7].
This study examines how different systems for managing exchange rates impact how well capital controls work to regulate money flowing in and out of a country. It's a crucial look at how policy choices can enhance or diminish efforts to maintain financial stability in an interconnected world [8].
This paper looks at the intricate dance between global value chains â?? how products are made across different countries â?? and the world of international trade finance. Using data from individual firms, it illustrates how deeply global production networks influence financial decisions and operations. This highlights the complex financial architecture underpinning global trade [9].
This study explores how climate risk is increasingly becoming a factor in international financial markets. It particularly highlights the growing importance of green bonds as a tool for directing capital towards sustainable investments and managing environmental-related financial risks globally. The integration of climate considerations into financial decision-making is becoming an imperative [10].
International financial markets are inherently interconnected, a characteristic profoundly underscored by various studies. Research demonstrates how financial crises propagate across international markets, highlighting the critical role of bank interdependencies and capital flows in driving contagion. What this really means is that national financial health is increasingly tied to global vulnerabilities, emphasizing the crucial need for robust and coordinated oversight to prevent widespread economic disruption [1]. Further illustrating this global interdependence, decisions made by the US Federal Reserve on monetary policy are not confined domestically; they spill over into global financial markets, significantly impacting capital flows and financial conditions, particularly in emerging market economies [4]. These findings collectively assert that financial stability is a shared global responsibility, demanding strong international cooperation and harmonized policy responses to manage systemic risks effectively.
The landscape of international finance is undergoing rapid transformation, driven by both technological advancements and evolving investment philosophies. One area of significant interest is the emerging connection between cryptocurrencies, blockchain technology, and the broader international financial system. This exploration delves into the implications for market efficiency, the complexities of regulating these novel assets, and their potential effects on overall financial stability, essentially providing a roadmap for the future of finance [3]. Simultaneously, financial technology, or FinTech, is actively reshaping the stability of banking systems across diverse countries. While FinTech undoubtedly presents exciting new possibilities for efficiency and broader access, it also introduces novel categories of risks that require meticulous management by regulators and financial institutions to preserve systemic stability [6]. Beyond technological shifts, there's a growing emphasis on sustainable investing, with research examining how Environmental, Social, and Governance (ESG) factors influence portfolio performance across various global markets, noting that the impact isn't uniform and largely depends on market development and investor awareness [2].
Financial integration represents a critical yet complex pathway for economic development, particularly for developing nations. Studies explore the intricate link between countries opening up their financial markets and subsequent economic growth. What they found is that while financial integration holds substantial potential to boost growth, this benefit is by no means automatic; it fundamentally relies on the quality of a country's institutional framework and the stability of its broader economic environment [5]. This suggests that simply liberalizing markets without foundational reforms can be insufficient or even counterproductive. In parallel, the effectiveness of policy tools designed to maintain financial stability, such as capital controls, is scrutinized. Research examines how different exchange rate regimes profoundly impact how well these controls work to regulate money flowing in and out of a country, offering crucial insights into how policy choices can either strengthen or diminish efforts to maintain stability in a globally connected world [8].
International financial markets are increasingly exposed to a range of evolving, non-traditional risks. Geopolitical events, encompassing political instability, regional conflicts, or major international disputes, are shown to significantly disrupt these markets. Research specifically analyzes how these heightened risks translate into direct effects on returns across different types of assets, clearly demonstrating that geopolitical tensions are not merely political phenomena; they carry profound and tangible economic consequences globally, influencing investment decisions and market volatility [7]. In a related vein, climate risk is rapidly emerging as a critical factor influencing international financial markets. This study specifically underscores the growing importance of green bonds as a vital mechanism for directing capital towards sustainable investments and effectively managing environmental-related financial risks on a global scale, showcasing a proactive approach to integrating climate considerations into mainstream financial decision-making [10].
The intricate relationship between global production systems and financial mechanisms is also a central theme in contemporary research. One paper delves into the complex interplay between global value chains â?? which illustrate how products are manufactured across various countries through a series of interconnected stages â?? and the world of international trade finance. Utilizing granular data from individual firms, it vividly demonstrates the profound extent to which global production networks influence financial decisions and operational strategies. This highlights the essential, often overlooked, financial architecture that underpins and enables international trade, emphasizing the need for a comprehensive understanding of how goods, services, and capital move across borders to effectively manage global economic flows and foster resilient supply chains [9].
This collection of research underscores the dynamic and interconnected nature of international financial markets, highlighting key drivers of stability and vulnerability. Studies reveal how financial crises propagate globally due to interconnected banks and capital flows, making robust oversight crucial [1]. Similarly, US Federal Reserve monetary policy decisions exert significant cross-border effects, particularly on emerging market economies [4]. The role of financial technology (FinTech) and digital assets like cryptocurrencies is explored, noting their potential to reshape banking stability and market efficiency while introducing new regulatory challenges [3, 6]. Investor focus on Environmental, Social, and Governance (ESG) factors is also examined, with findings indicating varied impacts on portfolio performance depending on market development and investor priorities [2]. Financial integration is presented as a double-edged sword: while it can foster economic growth in developing nations, its success is contingent on strong institutions and economic stability [5]. Effective policy tools, such as capital controls, are crucial, and their efficacy is shown to be influenced by prevailing exchange rate regimes [8]. Emerging global risks are also a significant concern. Geopolitical events are demonstrated to directly impact asset returns across international markets, while climate risk is increasingly influencing financial decisions, with green bonds emerging as a vital tool for sustainable investment and risk management [7, 10]. Finally, the intricate link between global value chains and international trade finance illustrates how deeply global production networks influence financial operations at the firm level [9]. Together, these studies paint a comprehensive picture of the challenges and transformations within the global financial system.
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Journal of Global Economics received 2175 citations as per Google Scholar report
