Recent empirical research finds that pairs of countries with stronger trade linkages tend to have more highly correlated business cycles. We assess whether the standard international business cycle framework can replicate this intuitive result. We employ a three-country model with transportation...

The financial crisis has re-ignited the fierce debate about the merits of financial globalizationand its implications for growth, especially for developing countries. The empirical literaturehas not been able to conclusively establish the presumed growth benefits of financialintegration. Indeed,...

We review the large literature on various economic policies that could help developingeconomies effectively manage the process of financial globalization. Our central findingsindicate that policies promoting financial sector development, institutional quality and tradeopenness appear to help...

In theory, one of the main benefits of financial globalization is that it should allow for moreefficient international risk sharing. In this paper, we provide a comprehensive empiricalevaluation of the patterns of risk sharing among different groups of countries and examinehow international...

The financial crisis has re-ignited the fierce debate about the merits of financial globalization and its implications for growth, especially for developing countries. The empirical literature has not been able to conclusively establish the presumed growth benefits of financial integration....

This paper studies how the sensitivity of consumption to income has changed over time as the degree of financial integration has risen. In standard theory, greater financial integration facilitates international borrowing and lending, helping to reduce the sensitivity of consumption growth to...

We review the large literature on various economic policies that could help developing economies effectively manage the process of financial globalization. Our central findings indicate that policies promoting financial sector development, institutional quality and trade openness appear to help...

The financial crisis has re-ignited the fierce debate about the merits of financial globalization and its implications for growth, especially for developing countries. The empirical literature has not been able to conclusively establish the presumed growth benefits of financial integration....

Recent empirical research finds that pairs of countries with stronger trade linkages tend to have more highly correlated business cycles. We assess whether the standard international business cycle framework can replicate this intuitive result. We employ a three-country model with transportation...

In theory, one of the main benefits of financial globalization is that it should allow for more efficient international risk sharing. In this paper, we provide a comprehensive empirical evaluation of the patterns of risk sharing among different groups of countries and examine how international...