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Liquidity, Institutional Quality and the Composition of International Equity Flows

Goldstein, Itay - 2010

FDI investors control the management of the firms, whereas FPI investors delegate decisions to managers. Therefore, direct investors are more informed than portfolio investors about the prospects of projects. This information enables them to manage their projects more efficiently. However, if...

Persistent link: https://www.econbiz.de/10012462924

Liquidity, Institutional Quality and the Composition of International Equity Outflows

Goldstein, Itay - 2008

We examine the choice between Foreign Direct Investment and Foreign Portfolio Investment at the level of the source country. Based on a theoretical model, we predict that (1) source countries with higher probability of aggregate liquidity crises export relatively more FPI than FDI, and (2) this...

Persistent link: https://www.econbiz.de/10012464879

Expectations, Asset Prices, and Monetary Policy : The Role of Learning

Gilchrist, Simon - 2006

This paper studies the implications of financial market imperfections represented by a countercyclical external finance premium and the gradual recognition of changes in the drift of technology growth for the design of an interest rate rule. Asset price movements induced by changes in trend...

Persistent link: https://www.econbiz.de/10012466222

Evaluation of Exchange-Rate, Capital Market, and Dollarization Regimes in the Presence of Sudden Stops

Razin, Assaf - 2005

The literature has not being able to identify clear-cut real effects of exchange-rate regimes on output growth … the effects of exchange rate and capital-market liberalization regimes, on the macroeconomic performance. The paper … of 100 low and middle-income countries. Findings indicate that the effects of exchange rate regimes, and liberalization …

Persistent link: https://www.econbiz.de/10012467554

An Information-Based Model of Foreign Direct Investment : The Gains from Trade Revisited

Razin, Assaf - 1999

Foreign direct investment (FDI) is observed to be a predominant form of capital flows to emerging economies, especially when they are liquidity-constrained internationally during a global financial crisis. The financial aspects of FDI are the focus of the paper. We analyze the problem of...

Persistent link: https://www.econbiz.de/10012471927

What Happened : Financial Factors in the Great Recession

Gertler, Mark - 2018

Since the onset of the Great Recession, an explosion of both theoretical and empirical research has investigated how the financial crisis emerged and how it was transmitted to the real sector. The goal of this paper is to describe what we have learned from this new research and how it can be...

Persistent link: https://www.econbiz.de/10012452974

Credit Spreads as Predictors of Real-Time Economic Activity : A Bayesian Model-Averaging Approach

Faust, Jon - 2011

Employing a large number of real and financial indicators, we use Bayesian Model Averaging (BMA) to forecast real-time measures of economic activity. Importantly, the predictor set includes option-adjusted credit spread indexes based on bond portfolios sorted by maturity and credit risk as...

Persistent link: https://www.econbiz.de/10012461932

Credit Market Shocks and Economic Fluctuations : Evidence from Corporate Bond and Stock Markets

Gilchrist, Simon - 2009

To identify disruptions in credit markets, research on the role of asset prices in economic fluctuations has focused on the information content of various corporate credit spreads. We re-examine this evidence using a broad array of credit spreads constructed directly from the secondary bond...

Persistent link: https://www.econbiz.de/10012463785

Credit Constraints and Stock Price Volatility

Hale, Galina - 2007

This paper addresses how creditor protection affects the volatility of stock market prices. Credit protection reduces the probability of oscillations between binding and non-binding states of the credit constraint; thereby lowering the rate of return variance. We test this prediction of a...

Persistent link: https://www.econbiz.de/10012465565

The Financial Accelerator in a Quantitative Business Cycle Framework

Bernanke, Ben - 1998

This paper develops a dynamic general equilibrium model that is intended to help clarify the role of credit market frictions in business fluctuations, from both a qualitative and a quantitative standpoint. The model is a synthesis of the leading approaches in the literature. In particular, the...

Persistent link: https://www.econbiz.de/10012472350