EIRP Proceedings, Vol 6 (2011)

Abstract

Objectives It’s very important to quantify the influence of various factors in the development of
financial crisis. Once these factors can be determined we can attempt to stop this phenomenon or at least
minimize its effects. Prior Work Previous studies have shown that the phenomenon of globalization makes
extremely disturbing phenomena quickly transmitted from one market to another, provided that these markets
will be connected. But what is the explanation when countries not linked in any way react in same way at the
appearance of disturbances in one of the country? Approach We study the phenomenon of contagion by
comparing the economy and financial market evolution, in Romania, during the last global financial crisis.
Results We can conclude that the Romanian market actually reacts to the behavior of investors while the in
the real economy effects are felt much later and/or have a weaker intensity. Implications For investors it’s
important to follow their expectations of the market evolution much more than the current economic
conditions. Value Knowing the influence of various factors in the evolution of financial markets we will
know what steps must be taken so that these crises will not be felt in the real economy or their impact will be
reduced.