■ Domestic consumption by foreigners tumbled in 2017, partly amplifying the fluctuations in domestic consumption and having a negative impact on consumption-related sectors e.g. services in Korea. ■ Chinese tourists are behind the current sluggishness of domestic consumption, implying that...

Purpose: In this study, we empirically demonstrate how the new variable of "cyclical consumption" can capture consumption risk and predict expected stock returns, which relationship is stronger and should be considered as the primary macro indicator for stock markets between KOSPI and KOSDAQ,...

This paper sets up a small open economy TANK model with constrained households to address the driving forces of business cycles in Korea. The estimated model via Bayesian methodology shows that nearly half of households have lacked access to financial markets before the Asian financial crisis....

Keynesian theory suggests that a reduction in government expenditure has a negative effect on private demand and therefore on output. Contrary, neoclassical theory argues that reduced public expenditure makes room for an expansion of the private sector and thus has a stimulating effect on the...