Economic Analysis: Theory and Practice
 

A factor analysis of trends in financial soundness of member states of the Shanghai Cooperation Organization

Vol. 17, Iss. 8, AUGUST 2018

Received: 13 March 2018

Received in revised form: 29 March 2018

Accepted: 30 April 2018

Available online: 29 August 2018

Subject Heading: MATHEMATICAL METHODS AND MODELS

JEL Classification: C13, C43, E02, E10, F01, F15, F62

Pages: 1545–1563

https://doi.org/10.24891/ea.17.8.1545

Smirnov V.V. I.N. Ulianov Chuvash State University, Cheboksary, Chuvash Republic, Russian Federation
walera712006@mail.ru

https://orcid.org/0000-0002-6198-3157

Mulendeeva A.V. I.N. Ulianov Chuvash State University, Cheboksary, Chuvash Republic, Russian Federation
alena-mulendeeva@yandex.ru

ORCID id: not available

Subject The article addresses the financial viability of member States of the Shanghai Cooperation Organization.
Objectives The study aims to perform a factor analysis of trends in the financial soundness of member States of the Shanghai Cooperation Organization, including the estimation of growth rates of a set of interdependent indicators, with subsequent polynomial approximation.
Methods The study draws on fundamental premises of the theory and practice of factor analysis, financial and economic laws, results of scientific research in the field of equilibrium and non-equilibrium country development of the global economy and world order.
Results We reveal countries with high and low growth rates of a set of interdependent indicators, and also with high and low instability in absolute magnitudes. The findings may be used in the process of formation and updating the foreign trade policy with member States of the Shanghai Cooperation Organization, and for improving the implementation mechanism.
Conclusions We conclude that the following countries have high growth rates for 2006–2016: Tajikistan (bank liquid reserves to assets), Kyrgyzstan (broad money supply, inflation, consumer prices), Kazakhstan (exchange rate), Uzbekistan (deflator index), Russia (interest rate on loans in the private sector), China (listed domestic companies); and high absolute amplitude values of instability: Kazakhstan (bank liquid reserves to assets), Tajikistan (broad money supply), India (exchange rate), Russia (deflator index, listed domestic companies), China (inflation, consumer prices), Kyrgyzstan (interest rate on loans in the private sector).

Keywords: amplitude, polynomial approximation, growth rate, factor analysis, financial soundness

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