Introduction
The global environment is very demanding and chaotic. An established government, challenges are monumental. Thus, a solid foundation should be laid and a clear sense of values and strength of purpose are required to become competitive politically, economically, socially, environmentally and globally (Crisholm, A 2002). Building a viable economy is very essential in keeping peace and state building. It certainly requires effective management of natural resources to attain economic, political and social recovery. As we move towards a self-functioning economy, a feasible long-term plan is much needed for sustainable growth development. It has been noted that bond market is regarded as the market for securities in which different industries and the government can raise long-term funds. Accordingly, the bond market worldwide is going through a period of unprecedented changes and growth which makes it a more interesting topic in the financial world.
The final decades of the twentieth century have seen the emergence of an era of finance that is the greatest since the 1890s and 1900s and, in terms of the values turned over in securities markets, the greatest era of finance in history (Crisholm, A 2002). By ‘era of finance’ is meant a period of history in which finance prospers with such apparent brilliance that it takes over from the industrial entrepreneur the leading role in capitalist development in which the bond market plays an important role (Valdez, S 2003). It is very easy to forget at the turn of the century, when the world’s economies are enchanted or bewitched by financial markets, The final decades of the twentieth century have seen the emergence of an era of finance that is the that this leading role of finance has not been the normal state of affairs in the capitalist economies in the past (Valdez, S 2003).
In this new generation, more and more countries are trying to develop a sustainable and efficient capital markets to ensure competitive advantage and economic development. Many believed that encouraging and sustaining an important capital market does more for the national economy. Primarily the main goal of this paper is to assess the significance of European bond market particularly the long term bond for the economic development of Romania.
In this research, the background, context and theme of the study are presented. Moreover, the objectives of the study and the research statements are formulated. Here, vital concepts, questions and assumptions are stated.
Aims and Objectives
The dissertation will focus the literature materials concerning to political aspects and economic progress. The research will also tackle the issues of economy’s improvement and direct implication of European bond market instability. Basically this study attempts to evaluate the long term bond of Romania. Moreover, the researcher aims to review the different variables concerning European bond market. Moreover, the aims and objectives of this dissertation are the following:
Background of the Study
Although debates over the future of Europe invariably focus on big-picture issues - the pros and cons of monetary union, full employment versus fiscal austerity or the challenges of sustaining social safety nets - the nature of European private sector seems virtually ignored (Valdez, S 2003). This omission is startling, since corporations are essentially the genetic code of European economic integration. Their characteristics and behaviour will ultimately define the shape of larger trends (Valdez, S 2003). Moreover, the continent's engagement with the global economy, whether through trade or investment, is mediated in large measure by the priorities of European companies and their interactions with the rest of the world (Demirgüç-Kunt, A & Levine, R 1996). Certainly, "Europe" itself encompasses some wide differences: distinct cultural, economic, and political factors have engendered diverse types of industrial enterprises (Demirgüç-Kunt, A & Levine, R 1996). True also, the forces of globalisation may be eroding the elements that once made European corporations unique. Still, historically speaking, and especially when compared with their American counterparts, European companies exhibit enough common traits for us to speak of an "old-continent model." The elements and the consequent network of personal relationships have given rise to the characterisation of European family business as "clubby," with all members of elite agreeing to play by a set of longstanding rules that place a premium above all on stability (Demirgüç-Kunt, A & Levine, R 1996). By the same token, for both cultural and social reasons, European corporations have traditionally tended to emphasise the interests of "stakeholders" added to the financial interests of shareholders.
The emphasis on stakeholders, as well as the large role played by businesses in many European countries as it meant that old-continent corporations tended to take a relatively long-term view of success. On the other hand, the technological change brought social change (Demirgüç-Kunt, A & Levine, R 1996). Translating the new technological opportunities into economic results led to enormous investments in productive as well as organisational infrastructure. The magnitude of capital required and the necessity to delegate responsibilities implied an enormous socialisation process into the mores of modern capitalism, at the bottom as well as the topmost levels of society. This process challenged leadership of the firm, leading to the enrolment and promotion of salaried managers in the final reallocation of power inside the company and, from there, into society.
European companies, aimed for agreements with competitors in order to control market fluctuations (Demirgüç-Kunt, A & Levine, R 1996). Thus, although free-enterprise values and an antitrust constituency, the same could not be said for Europe, where opportunities for growth were more limited and values were less market oriented. In other European countries, let say in Romania, businesses enjoyed far greater diffusion and business, enjoyed its own points of strength. From this discussion, more and more businesses in Europe create and formulate strategies to attain business success. Thus, as part of this development, companies should be aware to the factors that contribute to business progress. Long term bond in Romania should be analysed and evaluated.
Statement of the Problem
This dissertation seeks to investigate and evaluate the effect of European bond market to economic progress. Apparently, the discussion pertain to the economic development was facilitated.
Specifically, the following questions shall be answered:
1. What are the factors affect to the progress of a Romanian’s economy?
2. What are the developments in long term bond that affect economic progress of Romania?
3. Is there any relationship between the European bond market instability and economic progress?
Hypothesis
This study shall test the null hypothesis:
“European bond market stability has no significant effect to the progress of economy of Romania”.
Significance of the Study
It is obvious that stability in bond market affect the progress of a certain economy. The issues regarding long term bond in Romania might played significant effect to the progress of their economy. These advances have attracted substantial attention from academia, business, and government. This study shall be an informative guide to businesses, economist, government and consumers.
Scope and Limitation
This study will discuss the impact of European bond market instability to economic growth. The discussion shall outline the different factors affecting the success or failure of Romania in accordance to their long term bonds. It will also include political variables such as policy making and economic nature
The study intends to investigate the effects of political instability to the progress of economy. For this study, primary research and secondary research will be used. Primary research will be conducted using literature reviews related to politics and economic growth. The researcher will also be conducting focus group interview with politician, market analysts and economists regarding the possible effects of politics to economy.
Methodology
The research process “onion” of Saunders, Lewis and Thornhill (2003) will guide the researcher in order to come up with the most suitable research approaches and strategies for this study. It is safe to say that a research undertaking can be likened to the process of peeling the back layers of an onion. To apply the “onion” process, one must first recognise that in the case of a research, the central issue is how to collect the pertinent data that will answer the research questions and objectives. Second, in order to arrive at this central issue, several issues must be addressed: the first layer raises the question of the research philosophy to adopt, the second considers the subject of research approach that flows from the research philosophy, the third examines the research strategy most applicable, the fourth layer refers to the time horizon a researcher applies to his research, and the fifth layer is the data collection methods to be used (Saunders et al, 2003). With this process, albeit was possible to create an outline on what measures are most appropriate to be applied in the study.
Basically, this paper will be based on qualitative research method. There are two factors which stand to achieve from the use of qualitative research inquisition. First, researchers gain not only because of increased ease of use to pre-existing viewpoint and the contextually responsive nature of methodologies such as life history, but also for the reason that qualitative research methodology helps researchers address the "singularity of values" so ubiquitous in past research efforts and understand the nature of "intercontextual work.
This study can also be classified as being a descriptive research, a type of study that tries to explore the cause of a particular phenomenon, present facts concerning the nature and status of a situation, as it exists at the time of the study, and portray an accurate profile of persons, events or situations (Creswell, 1994; Robson, 2002).
This research approach was chosen for specific reasons: first, it is instant and flexible. Thus, when important new issues and questions arise during the duration of the study, a further investigation may be allowed; second, with this type of approach, it will be allowed to drop unproductive areas of research from the original plan of the study; and finally, a descriptive study is more practical (Creswell, 1994).
Description of the Data Used
This study has utilised secondary data. Secondary data include raw data and published summaries, as well qualitative data. Saunders et al (2003) said secondary data fall into three main subgroups—documentary data, and those compiled from different sources. Within this paper, survey data are not used but included from facts in documentary data.
Documentary secondary data are often used in research projects that also use primary data collection methods. Although such data can also be used on their own or be combined with other secondary data (e.g. written documents and non-written documents) (Saunders et al, 2003, pp. 190-191).
Finally, multiple-source secondary data are data that have been combined to form another set of data. Examples of these data are the various compilations of company information and various shares price listing for different stock markets in the financial sheet of a broadsheet newspaper (Saunders et al, 2003).
With this particular study, documentary secondary data (in the form of articles from books, journals, magazines, and newspapers that are generally about European bond market), and multiple-source secondary data.
Validation of the Data
According to Stewart and Kamins (1993), the use of secondary data is advantageous for a researcher since one can already evaluate the suitability of a data as it is already in existence. Thus, much time can be saved. An evaluation of potential secondary data is very important before incorporating it in into this thesis.
In this study, a three-stage process was adopted (Saunders et al 2003, p. 205):
The first stage is assessing the overall suitability of data to research questions and objectives. During this stage, the researcher paid particular attention to measurement validity (measuring / estimating whether the secondary data will result to a valid answer to the research questions and objectives) and coverage (this includes ensuring whether or not the data is wanted and can be included, as well as making sure that sufficient data remain for analyses to be undertaken once unwanted data have been excluded).
The second stage is evaluating precisely the suitability of data for analyses needed to answer and meet the research questions and objectives. In this stage, it is important to verify the validity and reliability of the secondary data (e.g. by assessing how it was previously gathered, which are its sources).
Outcomes
Based on this proposal, the research paper will have five chapters. The First Chapter will present the background of the study, the objectives, research problems, methodology, the study’s scope and limitation and its significance. In Chapter 2, literatures pertaining to European bond market, long term bond and economic growth of Romania are discussed. In Chapter 3, the methodology used for this study is discussed. In Chapter 4, the results of documentary and content analysis are presented. And in Chapter 5, the study summarises the findings and provides conclusion and recommendations.
The global environment is very demanding and chaotic. An established government, challenges are monumental. Thus, a solid foundation should be laid and a clear sense of values and strength of purpose are required to become competitive politically, economically, socially, environmentally and globally (Crisholm, A 2002). Building a viable economy is very essential in keeping peace and state building. It certainly requires effective management of natural resources to attain economic, political and social recovery. As we move towards a self-functioning economy, a feasible long-term plan is much needed for sustainable growth development. It has been noted that bond market is regarded as the market for securities in which different industries and the government can raise long-term funds. Accordingly, the bond market worldwide is going through a period of unprecedented changes and growth which makes it a more interesting topic in the financial world.
The final decades of the twentieth century have seen the emergence of an era of finance that is the greatest since the 1890s and 1900s and, in terms of the values turned over in securities markets, the greatest era of finance in history (Crisholm, A 2002). By ‘era of finance’ is meant a period of history in which finance prospers with such apparent brilliance that it takes over from the industrial entrepreneur the leading role in capitalist development in which the bond market plays an important role (Valdez, S 2003). It is very easy to forget at the turn of the century, when the world’s economies are enchanted or bewitched by financial markets, The final decades of the twentieth century have seen the emergence of an era of finance that is the that this leading role of finance has not been the normal state of affairs in the capitalist economies in the past (Valdez, S 2003).
In this new generation, more and more countries are trying to develop a sustainable and efficient capital markets to ensure competitive advantage and economic development. Many believed that encouraging and sustaining an important capital market does more for the national economy. Primarily the main goal of this paper is to assess the significance of European bond market particularly the long term bond for the economic development of Romania.
In this research, the background, context and theme of the study are presented. Moreover, the objectives of the study and the research statements are formulated. Here, vital concepts, questions and assumptions are stated.
Aims and Objectives
The dissertation will focus the literature materials concerning to political aspects and economic progress. The research will also tackle the issues of economy’s improvement and direct implication of European bond market instability. Basically this study attempts to evaluate the long term bond of Romania. Moreover, the researcher aims to review the different variables concerning European bond market. Moreover, the aims and objectives of this dissertation are the following:
- To identify the variables affecting to the progress of a certain economy.
- To determine the effect of European bond market to economic progress of Romania.
- Analysing the effect of European bond market in accordance to long term bond in Romania.
- To suggest suitable strategies for enhancing the progress and growth of an economy.
Background of the Study
Although debates over the future of Europe invariably focus on big-picture issues - the pros and cons of monetary union, full employment versus fiscal austerity or the challenges of sustaining social safety nets - the nature of European private sector seems virtually ignored (Valdez, S 2003). This omission is startling, since corporations are essentially the genetic code of European economic integration. Their characteristics and behaviour will ultimately define the shape of larger trends (Valdez, S 2003). Moreover, the continent's engagement with the global economy, whether through trade or investment, is mediated in large measure by the priorities of European companies and their interactions with the rest of the world (Demirgüç-Kunt, A & Levine, R 1996). Certainly, "Europe" itself encompasses some wide differences: distinct cultural, economic, and political factors have engendered diverse types of industrial enterprises (Demirgüç-Kunt, A & Levine, R 1996). True also, the forces of globalisation may be eroding the elements that once made European corporations unique. Still, historically speaking, and especially when compared with their American counterparts, European companies exhibit enough common traits for us to speak of an "old-continent model." The elements and the consequent network of personal relationships have given rise to the characterisation of European family business as "clubby," with all members of elite agreeing to play by a set of longstanding rules that place a premium above all on stability (Demirgüç-Kunt, A & Levine, R 1996). By the same token, for both cultural and social reasons, European corporations have traditionally tended to emphasise the interests of "stakeholders" added to the financial interests of shareholders.
The emphasis on stakeholders, as well as the large role played by businesses in many European countries as it meant that old-continent corporations tended to take a relatively long-term view of success. On the other hand, the technological change brought social change (Demirgüç-Kunt, A & Levine, R 1996). Translating the new technological opportunities into economic results led to enormous investments in productive as well as organisational infrastructure. The magnitude of capital required and the necessity to delegate responsibilities implied an enormous socialisation process into the mores of modern capitalism, at the bottom as well as the topmost levels of society. This process challenged leadership of the firm, leading to the enrolment and promotion of salaried managers in the final reallocation of power inside the company and, from there, into society.
European companies, aimed for agreements with competitors in order to control market fluctuations (Demirgüç-Kunt, A & Levine, R 1996). Thus, although free-enterprise values and an antitrust constituency, the same could not be said for Europe, where opportunities for growth were more limited and values were less market oriented. In other European countries, let say in Romania, businesses enjoyed far greater diffusion and business, enjoyed its own points of strength. From this discussion, more and more businesses in Europe create and formulate strategies to attain business success. Thus, as part of this development, companies should be aware to the factors that contribute to business progress. Long term bond in Romania should be analysed and evaluated.
Statement of the Problem
This dissertation seeks to investigate and evaluate the effect of European bond market to economic progress. Apparently, the discussion pertain to the economic development was facilitated.
Specifically, the following questions shall be answered:
1. What are the factors affect to the progress of a Romanian’s economy?
2. What are the developments in long term bond that affect economic progress of Romania?
3. Is there any relationship between the European bond market instability and economic progress?
Hypothesis
This study shall test the null hypothesis:
“European bond market stability has no significant effect to the progress of economy of Romania”.
Significance of the Study
It is obvious that stability in bond market affect the progress of a certain economy. The issues regarding long term bond in Romania might played significant effect to the progress of their economy. These advances have attracted substantial attention from academia, business, and government. This study shall be an informative guide to businesses, economist, government and consumers.
Scope and Limitation
This study will discuss the impact of European bond market instability to economic growth. The discussion shall outline the different factors affecting the success or failure of Romania in accordance to their long term bonds. It will also include political variables such as policy making and economic nature
The study intends to investigate the effects of political instability to the progress of economy. For this study, primary research and secondary research will be used. Primary research will be conducted using literature reviews related to politics and economic growth. The researcher will also be conducting focus group interview with politician, market analysts and economists regarding the possible effects of politics to economy.
Methodology
The research process “onion” of Saunders, Lewis and Thornhill (2003) will guide the researcher in order to come up with the most suitable research approaches and strategies for this study. It is safe to say that a research undertaking can be likened to the process of peeling the back layers of an onion. To apply the “onion” process, one must first recognise that in the case of a research, the central issue is how to collect the pertinent data that will answer the research questions and objectives. Second, in order to arrive at this central issue, several issues must be addressed: the first layer raises the question of the research philosophy to adopt, the second considers the subject of research approach that flows from the research philosophy, the third examines the research strategy most applicable, the fourth layer refers to the time horizon a researcher applies to his research, and the fifth layer is the data collection methods to be used (Saunders et al, 2003). With this process, albeit was possible to create an outline on what measures are most appropriate to be applied in the study.
Basically, this paper will be based on qualitative research method. There are two factors which stand to achieve from the use of qualitative research inquisition. First, researchers gain not only because of increased ease of use to pre-existing viewpoint and the contextually responsive nature of methodologies such as life history, but also for the reason that qualitative research methodology helps researchers address the "singularity of values" so ubiquitous in past research efforts and understand the nature of "intercontextual work.
This study can also be classified as being a descriptive research, a type of study that tries to explore the cause of a particular phenomenon, present facts concerning the nature and status of a situation, as it exists at the time of the study, and portray an accurate profile of persons, events or situations (Creswell, 1994; Robson, 2002).
This research approach was chosen for specific reasons: first, it is instant and flexible. Thus, when important new issues and questions arise during the duration of the study, a further investigation may be allowed; second, with this type of approach, it will be allowed to drop unproductive areas of research from the original plan of the study; and finally, a descriptive study is more practical (Creswell, 1994).
Description of the Data Used
This study has utilised secondary data. Secondary data include raw data and published summaries, as well qualitative data. Saunders et al (2003) said secondary data fall into three main subgroups—documentary data, and those compiled from different sources. Within this paper, survey data are not used but included from facts in documentary data.
Documentary secondary data are often used in research projects that also use primary data collection methods. Although such data can also be used on their own or be combined with other secondary data (e.g. written documents and non-written documents) (Saunders et al, 2003, pp. 190-191).
Finally, multiple-source secondary data are data that have been combined to form another set of data. Examples of these data are the various compilations of company information and various shares price listing for different stock markets in the financial sheet of a broadsheet newspaper (Saunders et al, 2003).
With this particular study, documentary secondary data (in the form of articles from books, journals, magazines, and newspapers that are generally about European bond market), and multiple-source secondary data.
Validation of the Data
According to Stewart and Kamins (1993), the use of secondary data is advantageous for a researcher since one can already evaluate the suitability of a data as it is already in existence. Thus, much time can be saved. An evaluation of potential secondary data is very important before incorporating it in into this thesis.
In this study, a three-stage process was adopted (Saunders et al 2003, p. 205):
The first stage is assessing the overall suitability of data to research questions and objectives. During this stage, the researcher paid particular attention to measurement validity (measuring / estimating whether the secondary data will result to a valid answer to the research questions and objectives) and coverage (this includes ensuring whether or not the data is wanted and can be included, as well as making sure that sufficient data remain for analyses to be undertaken once unwanted data have been excluded).
The second stage is evaluating precisely the suitability of data for analyses needed to answer and meet the research questions and objectives. In this stage, it is important to verify the validity and reliability of the secondary data (e.g. by assessing how it was previously gathered, which are its sources).
Outcomes
Based on this proposal, the research paper will have five chapters. The First Chapter will present the background of the study, the objectives, research problems, methodology, the study’s scope and limitation and its significance. In Chapter 2, literatures pertaining to European bond market, long term bond and economic growth of Romania are discussed. In Chapter 3, the methodology used for this study is discussed. In Chapter 4, the results of documentary and content analysis are presented. And in Chapter 5, the study summarises the findings and provides conclusion and recommendations.
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