Open AccessConflict Risk and Its Implication on Economy and Financial System
Author(s) -
Ümit Hacıoğlu,
Hasan Di̇nçer,
İsmail Erkan Çelik
Publication year - 2016
Publication title -
international journal of finance and banking studies
Language(s) - English
Resource type - Journals
ISSN - 2147-4486
DOI - 10.20525/ijfbs.v2i2.638
Subject(s) - monetary economics , economics , equity (law) , profitability index , volatility (finance) , financial market , risk appetite , profit (economics) , financial economics , finance , risk management , microeconomics , political science , law
Considering the impacts of the conflict on the economic parameters in terms of macroeconomics, the following factors might affect the profitability of the company: foreign capital outflows, decrease in exports, increase in the interest rates, disruption of the investment climate, increase in the exchange rates, increase in the costs of import entry etc. Due to the expectable decrease in profit shares as to the investors, the contraction in the risk appetite will cause volatility in the prices of equity securities markets based on the impacts of the conflict, and the equity securities will depreciate. In this study, the main contributions on conflict risk and related econometric models have been discussed.