This paper analyses the impact of global and regional spillovers to GCC equity markets. GCC equity markets were impacted by spillovers from US equity markets despite varying degrees of foreign participation. Spillovers from regional equity markets were also important but the magnitude of the...

This paper analyzes the experiences of emerging market economies (EMEs) that have liberalized capital flows over the past 15 years with respect to macroeconomic performance and risks to financial stability. The results of the panel data regressions indicate that greater openness to capital flows...

This paper assesses empirically the key drivers of private capital flows to a large sample of emerging market economies in the last decade. It analyzes the effect of the global financial cycle, measured by the VIX, on capital flows and investigates the role of fundamentals and country...

This paper investigates whether emerging market countries can implement monetary policies to cope with financial crises as advanced countries did during the recent global crisis—injecting significant amounts of money into the financial system without facing major short-run adverse...

This paper asks whether interest rate rules that respond aggressively to inflation, following the Taylor principle, are feasible in countries that suffer from fiscal dominance. We find that if interest rates are allowed to also respond to government debt, they can produce unique equilibria. But...

This paper describes the behavior of tax policies under incomplete financial markets. The government finances a stochastic stream of expenditures by collecting the capital income and the labor income taxes, and issuing a one-period bond which pays state-contingent returns. We show that putting...