EXAMINING MACROECONOMIC POLICIES AND THEIR IMPACT ON CORPORATE FINANCE: A COMPARATIVE ASSESSMENT OF DEVELOPED AND EMERGING ECONOMIES

Abstract

This study explores corporate finance and investment determinants across developed and emerging economies. It employs both quantitative and qualitative approaches to provide insights for policymakers, business executives, and investors. The quantitative analysis evaluates macroeconomic policies and corporate financial dynamics through summary statistics, correlation assessments, and panel regression modelling. The qualitative segment utilises thematic charts and word clouds to visualise key themes and concerns derived from interviews with financial managers and policymakers. The research examines 500 firms—250 from developed economies and 250 from emerging markets—spanning the period from 2010 to 2023. It assesses the impact of the global financial crisis and the COVID-19 pandemic on corporate finance and investment strategies. Well-regulated businesses foster long-term investment by ensuring stability and predictability. Conversely, emerging economies prioritise rapid growth and industrialisation despite challenges such as market volatility, infrastructure deficiencies, and governance constraints. These obstacles are mitigated through foreign investment, technology transfer, and the integration of specialised expertise, which collectively stimulate economic development.  Qualitative interviews underscore the significance of effective business strategies, sound governance, and efficient public administration across both economic contexts. This study contributes to the literature on corporate finance and investment decision-making across diverse economic environments. The findings advocate for the enhancement of governance structures, market stability, innovation, and regulatory frameworks in developed economies. Furthermore, research and development (R&D), technological integration, governance improvements, and market stability are identified as essential factors for sustaining competitiveness and financial resilience in developed markets.