The Universidad Carlos III de Madrid (UC3M) has been awarded two prestigious Consolidator Grants from the European Research Council (ERC), one of the most competitive calls in the EU Framework Programme. The selected projects —ROCINANTE, focused on researching and developing disruptive space-propulsion technologies, and EXKIN, dedicated to studying social mobility and the persistence of inequality— will receive nearly €4 million in total funding over the next five years.

Nicole Karwowski examined the economic impact of the federal Wetland Reserve Program in a new paper published last month.

 Researchers from BI Norwegian Business School and NHH Norwegian School of Economics have developed a new behavioral credit-risk model that integrates credit and debit transactions. The model significantly outperforms state-of-the-art machine learning methods in predicting credit card delinquency and offers clearer insight into the behavioral drivers behind repayment problems.

Abstract

Purpose – This study aims to explore the impacts of U.S. debt ceiling uncertainty on crude oil markets and further reveal the specific influence mechanisms.

Design/methodology/approach – This paper introduces a debt ceiling uncertainty index based on news reports and selects six representative crude oil futures and spot markets to investigate the heterogeneous impacts of U.S. debt ceiling uncertainty on crude oil markets. More specifically, on the one hand, the nonparametric causality-inquantiles test method is used to discuss the asymmetric impacts of debt ceiling uncertainty on the different conditional distributions of crude oil series. On the other hand, the dynamic effects of debt ceiling uncertainty on crude oil markets are analyzed, combining with the time-varying parameter vector autoregressive model.

Findings – The conclusions of this paper are as follows: First, the U.S. debt ceiling uncertainty has obvious nonlinear impacts on each crude oil market, and the effects are greater under the normal condition of crude oil markets rather than under their extreme conditions. Second, the shocks from debt ceiling uncertainty to crude oil markets are mainly illustrated as negative and can be significantly enhanced by important debt-related events. Over time, the reactions of crude oil markets turn to weak positive and gradually dissipate after 6 months. Finally, enterprise production, investor sentiment and government shutdown play important roles as transmission intermediaries for the influence of debt ceiling uncertainty on the crude oil market.

Originality/value – The findings are beneficial for investors to accurately judge oil price trends and prevent investment losses caused by debt risks and also help producers prevent the impacts of crude oil price changes on production and operation activities. Moreover, it is conducive to the management department to maintain the stability of the crude oil market, thus enabling the crude oil financial market to better serve the real economy.