Assessing the impact of monetary fundamentals on exchange rate fluctuations a Bayesian network approach

Charfi, Sahar; BenHamad, Salah; Masmoudi, Afif

doi:10.1108/jm2-09-2018-0130

Cited by 2 publications

(1 citation statement)

References 36 publications

(41 reference statements)

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“…Nielsen and Jensen (2009) and Alexander (2003), have used the Bayesian network analysis in the business field, for multi-variate and integrated analysis of the risks, for monitoring and evaluating intervention strategies. Bayesian network analysis has also been used to examine the fluctuations in exchange rates caused by monetary fundamentals (Charfi et al , 2019). Dalla Valle and Giudici (2008), used the Bayesian methods to integrate the scarce and inaccurate quantitative data with prior information provided by the experts to estimate operational loss distributions.…”

Section: Literature Reviewmentioning

confidence: 99%

Analysis of demand risks for the Indian automotive sector in globally competitive environment

Kumar

Jain

Kain

et al. 2020

IJOA

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Purpose The purpose of this study is to understand the different types of risks affecting the demand for the automotive sector in India. The study is further trying to illustrate an approach for analyzing the relative intensities of these risks in the present uncertain business environment. Design/methodology/approach Risk on the overall demand is assessed by a combined Bayesian – multi-criteria decision-making approach. Data related to the different factors, affecting their product demand is collected from major automobile firms. Then, weights for these factors are evaluated by applying the analytic hierarchy process approach. Further, these weights are used in the Bayesian analysis network to evaluate the risk intensity for different subgroups, namely, political, economic, social, technological and environmental. Findings From the literature and experts’ opinion, total 16 risk factors have been finalized and these are further grouped into 5 categories i.e. political, economic, social, technological and environmental. It is observed that the demand for organizations functioning in the automotive sector is more vulnerable to economic risk as compared to other risks considered in the study. Practical implications Managers and decision makers of associated organizations can use the proposed framework to assess the demand risks so as to pre-evaluate their demand corresponding to future changes. Factors can be added or removed and importance could be assigned to different risk factors according to the prevailing business environment for an organization or sector. This will also help the organizations to conduct a more effective risk management in an uncertain business environment. Originality/value The study will help in better understanding of the various demand risks prevalent in the Indian auto sector. The methodology used, provides a novel approach for assessing the macroeconomic demand risks and can be used by the firms working in the automotive sector. The proposed methodology could be used for assessing supply chain risk or any other business initiative risk. The suggested approach will help managers in devising flexible management techniques so as to mitigate the risk.

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Section: Literature Reviewmentioning

confidence: 99%