Navigating the Economic Landscape in the Asian Pacific: A Study of Climate, Security, and Economic Spillovers across Stock Markets

doi: https://doi.org/10.35536/lje.2023.v28.i2.a4

Qingmei Tan, Muhammad Haroon Rasheed, Muhammad Shahid Rasheed and Kamran Ali



04
Received
July
2024
26
Revised
October
2024
31
Accepted
October
2024
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Abstract

The Asian Pacific region is spearheading the post-pandemic economic revival, and exploring regional dynamics is becoming increasingly relevant for researchers. In this regard, stock markets have always profoundly influenced a country's economic health, and its behavior varies significantly globally. This indicates stock markets' contextualized nature and response to varying incoming information. Therefore, the study examines the interplay of behavioral and developmental factors in selected stock markets from South Asia. This study draws upon data from 2014 to 2023 and utilizes VAR-based connectedness models to analyze the dynamics of stock market connectedness in the region. This study also considers the influence of pertinent regional climate, security, and economic challenges on stock market behavior. The findings indicate the presence of moderate spillovers among stock markets and from economic, environmental, and security information. Further, most of this spillover is attributed to the markets in developed nations and the economic news sentiments, while climate information's contagion is increasingly becoming relevant. These findings explain the intricate dynamics of these pertinent variables, significantly adding to the understanding of the region.

Keywords

South Asia, stock markets, spillover, sustainability, terrorism, sentiments

Citation:

“Tan, Q., Rasheed, H.R., Rasheed, M.H., and Ali, K. (2024). Navigating Economic Landscape in Asian Pacific: A Study of Climate, Security, and Economic Spillovers across Stock Markets.” Lahore Journal of Economics, 28(2), 77–97.

https://doi.org/10.35536/lje.2023.v28.i2.a4

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