Revista Finanzas y Política Económica <p>The <em>Revista Finanzas y Política Económica</em> - Journal of Economics (ISSN:&nbsp;2248-6046,&nbsp;E-ISSN: 2011-7663), is the official publication of the Faculty of Economics of Catholic University of Colombia. Since 2007 until today, the journal has created a research and scientific space&nbsp;where the issues related to economic policies, finance and other topics linked to economics in the Colombian, Latin American, and global context, are analyzed and discussed by top-level researchers.</p> en-US <p>This journal is licensed by a Creative Commons Attribution License (CC BY-NC-SA 4.0) <a href="" target="_blank" rel="noopener">Attribution-Non Commercial 4.0 International</a>. For the CC licenses, the principle isthe creative freedom. This system complements the copyright without opposing it, conscious of its importance in our culture. The content of the articles is the responsibility of each author, and does not compromise in any way, to the magazine or the university. It allows the transmission and reproduction of titles, abstracts and full content, with academic, scientific, cultural ends, provided acknowledgment of the respective source. This work cannot be used for commercial purposes.&nbsp;</p> <p><a href="" rel="license"><img src="" alt="Licencia de Creative Commons"></a></p> (Joan Miguel Tejedor Estupiñán, PhD (c)) (Héctor Renán Soto) Wed, 11 Sep 2019 00:00:00 -0500 OJS 60 The implementation of the Peace Agreements and Development in Colombia <p>Colombia is a multicultural and multiethnic country, surrounded by two oceans, with thousands of paramos, lagoons, and rivers born in a complex geography created by three mountain range systems. A territory that, from its highest points to its plains and jungles—like the Darién Gap or the Amazon—, offers an almost infinite variety of ecosystems and ways of life, due to which the country has been included in the exclusive group of megadiverse nations of the world. A nation rich in solar, wind, river, mineral, agricultural, and maritime resources, but with its industrial and service sectors still under development, where high levels of violence, poverty, and inequality are still part of the country’s reality.</p> Joan Miguel Tejedor-Estupiñán Copyright (c) 2019 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:04:04 -0500 A simple extension of Rolle’s theorem and its relation with multiple internal rates of return (IRR) <p>This paper presents a simple extension of Rolle’s Theorem. This extension allows determining the amount of numbers <em>ξ<sub>i</sub></em> in which <em>f'</em>(<em>ξ<sub>i</sub></em>) = 0 in a given interval, using the characteristics of the function f in that interval. The extension has been proved, and the geometric interpretation has been presented. Illustrative examples have also been developed for each case that can be obtained by applying the extension. Finally, the study examines the relation of this theorem with the problem of multiple internal rates of return (IRR).</p> Fernando Gómez Villarraga Copyright (c) 2019 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:02:41 -0500 Determinants of Mexico’s Bilateral Trade Balance: Income, Exchange Rate, and Export Composition <p>Using dynamic panel data models, this paper studies the determinants of Mexico’s bilateral trade balance with 39 trade partners from 1990 to 2016. The literature points to income and real exchange rate as key independent variables. This study includes export composition as an explanatory variable (a previously neglected aspect). Results differ from other researches: there is no robust evidence on the effect of income; there is evidence of the association between bilateral balance and real exchange rate; and there is a weak positive link with exports consisting of high-tech goods, partially explaining Mexico’s persistent trade deficit.&nbsp;</p> Carlos Alberto Carrasco, Edgar Demetrio Tovar-García Copyright (c) Mon, 02 Mar 2020 11:05:10 -0500 Analysis of Transport Infrastructure Development and Competitiveness in the Member Countries of Pacific Alliance (2007-2016) <p>The development of transport infrastructure is a key element for increasing competitiveness, as it reduces the distance effect and freight transport costs, allowing the generation of efficiencies in market integration. This descriptive study uses a comparative methodology, taking as variables the indicators of global competitiveness of the member countries of the Pacific Alliance during the period 2007-2016. The analysis of the results shows a weak trend in the infrastructure development of the Pacific Alliance group and a notable asymmetry among the member countries. There is a need for an individual strategy in each country that is in line with the objectives of trade integration in Asia. Another finding suggests that the achievement of better indicators depends on other significant variables and on the way in which the costs of transport infrastructure investments are passed on to agents who move freight.</p> Raul Alberto Cortes-Villafradez, Nicolas de la Peña-Cárdenas Copyright (c) 2019 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:06:17 -0500 The effects of credit cards on consumption structure and inequality in Mexican households <p>This paper analyzes the effects of credit card holding on the structure and distribution of household expenditure in Mexico in 2016. To the effect, two-stage quantile regressions are used to estimate models for consumption determinants, using instrumental variables on credit card holding. The study evidences that credit cards have a positive effect on aggregate consumption, driven mainly by increased health expenditure and items such as clothing, communications, and entertainment. Results show that credit card holding does not have statistical effects on education expenditure, nor on durable goods consumption. Also, the effects of credit cards are greater on the top of consumption distribution; thus, the effects of such financial services on the reduction of inequality and the future well-being of families are questioned, given that preconditions for financial inclusion have not been enough.&nbsp;</p> Owen Eli Ceballos-Mina, Luis Enrique Santiago-Ayala Copyright (c) 2019 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:06:56 -0500 Urban solid waste management in Latin America: An analysis from the perspective of waste generation <p>Solid waste management is a working agenda for sustainable development. Latin America has adopted policies and promulgated regulations that have led to the prohibition of open-air dumps, an inclusion of recyclers into the management process, and incentives to reduce the generation of urban solid waste. This article analyzes the correlation between the generation of urban solid waste and some other factors in nine cities of the region, between 2007 and 2014, using official statistics from each country. Results show that there is a significant correlation between per capita income and school coverage rate. Although there have been some improvements, there also remain challenges in order to raise awareness among citizens about their role in reducing the generation of solid waste.</p> María del Pilar Sánchez-Muñoz, José Gabriel Cruz-Cerón, Paula Carolina Maldonado-Espinel Copyright (c) 2019 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:07:55 -0500 Integration among world and low quality crude oil markets based on dynamic conditional correlations <p>This paper tests the degree of integration between Mexico’s and world crude oil markets throughout the evolution of dynamics correlations during the stable, crisis and volatile periods. The estimations of DCC-GARCH model show that the correlations are positive and time-varying in responds to the origin of the oil price shocks in periods of relative calm and financial turmoil. Likewise, the results of statistic-t and bootstrap p-value confirm strongly that the correlations in the crisis period are significantly different from those in the stable and volatile periods, which provides evidence in favor of the regionalization hypothesis between crude oil markets. The findings have important economic and financial implications for the government and consumers.</p> Raúl de Jesús-Gutiérrez Copyright (c) 2020 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:09:18 -0500 Capital Structure-Firm Value Nexus: Moderating Role of Profitability <p>This study aims to investigate the moderating role of profitability in the relationship between capital structure and firm value in Jordan, as an example of an emerging economy. For this purpose, two functional models were formulated to capture the direct relationship as well as the interaction impact of capital structure on firm value. The robust empirical findings of panel data analysis provide strong evidence of an adverse relationship between capital structure and firm value. The findings confirm that the impact of capital structure appears to be complicated in nature and difficult to examine without controlling for the interaction of profitability as one of the major determinants. Therefore, studying the interaction effect provides ample evidence and enhances the understanding of the link between firm value and capital structure. The empirical results of the study may provide important insights and policy implications to decision-makers.</p> Hamed Ahmad Almahadin, Yazan Salameh Oroud Copyright (c) 2020 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:09:56 -0500 Effect of heuristic anchoring and adjustment, and optimism bias, in stock market forecasts <p>Stock market forecasting is an important and challenging process that influences investment decisions. This paper presents an experimental design that aims to measure the influence of the anchoring and adjustment heuristic and optimism bias in these forecasts. The study was conducted using information from the S&amp;P MILA Pacific Alliance Select financial index; this was presented to 670 students from the cities of Concepción (Chile), Cali (Colombia), and Lima (Peru). Data was collected and presented through an instrument that asked participants to make a forecast judgment of the said financial index, based on the presented graphics, representing a year, a month, a week, and the last closing value of the index. Thus, it was possible to measure the influence of the anchor and adjustment heuristic in order to establish whether the presence of an initial value affected the financial forecast. Similarly, the study sought to determine whether the judgment issued was biased toward an optimistic or pessimistic position, thereby proving the presence of an error or expectation bias, known as optimism bias. The results were analyzed using the least squares method, and the data panel confirmed that the anchoring and adjustment heuristic influences the forecast of the financial index used in the study. Similarly, the presence of optimism bias in the cognitive process of forecasting in finance was inferred.</p> Victor Alberto Peña , Alina Gómez-Mejía Copyright (c) 2020 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:10:46 -0500 Scenarios of a turbulent Brexit <p>The decision made by the United Kingdom to leave the European Union has been one of the most delicate moments in the history of the European integration project. Given the difficulties of doing other types of evaluations at the moment, this work aims to analyze the causes and the process followed, since it is the first time that a member country—one of the most prominent ones—takes this path. The conversations carried out for this purpose have posed unanswered questions of economic, political, and social nature about how to carry out this order successfully; this has raised serious doubts about its advantages, which were discussed at the time of voting for the exit from the European Union. This situation has created a climate of distrust between European and British citizens regarding their politicians, as it is not very clear if the latter are really defending the interests of the country or others.</p> Margarita Navarro-Pabsdorf, Eduardo Cuenca-García, Angela Andrea Caviedes Copyright (c) 20 Revista Finanzas y Política Económica Mon, 02 Mar 2020 11:08:34 -0500