This paper analytically and empirically examines the effects of financial shocks and volatility on market functioning and institutional resilience, drawing on recent empirical research published by major international economic institutions between 2024 and 2025. Since 2024, the global economy has been exposed to compound shocks, including rising trade barriers, intensified geopolitical tensions, and heightened policy uncertainty, which have collectively increased macro-financial instability. Through a comparative analysis of advanced economies and emerging market economies, this study demonstrates that institutional quality plays a decisive role in determining shock absorption capacity and the management of financial volatility. The findings indicate that economies characterized by robust institutional frameworks exhibit significantly greater resilience to external disturbances, maintaining stability in economic performance. By contrast, economies with institutional vulnerabilities tend to experience amplified shocks, prolonged volatility, and persistent deviations from long-term growth trajectories. The analysis further suggests that financial shocks interact with institutional structures, shaping heterogeneous adjustment paths across countries. This paper argues that, in an era of elevated global uncertainty, sustained investment in institution-building constitutes a fundamental prerequisite for enhancing economic resilience and ensuring durable macroeconomic stability.
城穂 参川 (Tue,) studied this question.