Both mean spillover and volatility spillover refer to the observable information transmission phenomenon between financial markets (including the same type of financial markets across countries and different financial markets within a country, and of course different financial markets across countries).

According to the strong efficient market hypothesis of financial markets, any information related to financial markets will be digested by all financial markets at the same time in the fastest time and reflected in the price level. That is to say, the price of each financial market will follow a random trend.

Wandering patterns, while market returns can exhibit white noise.

There should be no spillovers between financial markets because all information is absorbed by all markets at the same time.

However, through research by many scholars, it has been found that spillover effects exist and information can be observed to be transmitted across markets.

For the convenience of research, this spillover effect is artificially broken down into two types: mean spillover and fluctuation spillover.

Mean spillover generally refers to the impact of changes in one market price or return on other markets. This impact can be positive or negative. For example, rising interest rates will cause stock prices to fall.

Volatility spillover refers to the impact of changes in one market volatility (generally measured by variance) on other markets. This impact is not positive or negative, but only large or small.

It is easy to imagine that when the volatility of the U.S. stock market increases, or increases dramatically, the stock market volatility of other countries will also increase. This is actually a manifestation of "financial contagion."

Extended information: 1. Theoretical background of spillover effects: 1. Arrow was the first to use externalities to explain the role of spillover effects on economic growth.

He believes that new investments have a spillover effect. Not only can the investing manufacturers improve their productivity by accumulating production experience, but other manufacturers can also improve their productivity through learning.

2. Romer proposed the knowledge spillover model.

What makes knowledge different from ordinary commodities is that knowledge has a spillover effect.

This enables the knowledge produced by any manufacturer to improve the productivity of the entire society. "Endogenous technological progress is the driving force for economic growth. In the Romer model, the total production function describes the stock and output of capital stock, labor force, and creative technology.

3. Lucas’s human capital spillover model points out that the spillover effect of human capital can be explained as learning from others or learning from each other. A person with higher human capital will have more benefits for those around him.

It has a beneficial effect and increases the productivity of those around it. But he does not benefit from it. 4. Parent studied the relationship between technology diffusion, learning by doing and economic growth. He designed a specific manufacturer's choice of technology and absorption time.

Based on the learning-by-doing model, he believes that between the absorption of various technologies before and after, the proprietary technical knowledge accumulated by manufacturers through learning-by-doing has prepared them for further technology introduction. 5. Kegao believes that technology spillover effects occur.

It comes from two aspects: one is from demonstration, imitation and dissemination; the other is from competition. The former is an increasing function of technological information differences, and the latter mainly depends on the market characteristics and mutual influence of multinational companies and local manufacturers. 6. Prosperity.

and Blomstrom more comprehensively see the impact of the decision-making behavior of local manufacturers and MNC subsidiaries on spillovers. On the one hand, it is assumed that MNC subsidiaries are aware of the costs of technology diffusion. On the other hand, it is assumed that local manufacturers are aware of the costs of technology diffusion.

We can also be aware of the existence of spillovers. Under the premise of mutual constraints, we can obtain respective dynamic optimal solutions. In theory, both multinational corporations' subsidiaries and local enterprises may affect the level of spillovers through their investment decisions.

The more investment in new technologies, the more spillovers there are. The more local companies invest in learning, the stronger their ability to absorb spillovers. It can be seen that in addition to the original spillover effects, there is also a type of spillover that depends on local manufacturers and

The spillover effect of the investment decisions of multinational companies' subsidiaries is cumulative and has a positive feedback nature. 2. Effect theory 1. The development of one aspect of a thing drives the development of other aspects of the thing. 2. The total demand of a country and its citizens.

The impact of increased income on other countries. 3. Spillover effects: There are technology spillover effects. Multinational corporations are the main inventors of the world's advanced technologies and the main source of supply of the world's advanced technologies. Multinational corporations realize their technology transfer through internalization of foreign direct investment.

. This technology transfer behavior will bring external economies to the host country, that is, technology spillover is a specific case of positive externality, which is neither a benefit obtained within the economic activity itself nor caused by the project.

Users of the products of the activity gain benefits. In other words, this benefit is external to the economic activity itself and creates an external economy for society. For example, a multinational company invents a new technology, and then the technology is competed with.

Corporate copying or learning occurs when competing companies collect the basic knowledge of new technologies from multinational companies and combine them with their own research and development to produce research results similar to those of multinational companies; the benefits will be external, since it is the company that realizes or generates the benefits and

Companies that produce technology compete, that is, technology creates spillover effects.