The Role of Cross-border Supervisory Coordination when Dealing with Rapid Credit Growth in Emerging Countries— Home Country Perspective

Author(s):  
Linda van Goor
2021 ◽  
Author(s):  
Doriane Intungane

The recent financial crisis started a global debate on the role of financial policies, which led to financial system reforms in many countries. These reforms mainly consisted of increasing the usage of macroprudential policies. This dissertation seeks to understand whether macroprudential policies in financially integrated countries reduced their vulnerability to the impact of external shocks. Chapter 2 empirically examines the impact of macroprudential policies on cross-border bilateral credit growth. Capital requirements and loan-to-value (LTV) ratios, in 15 lending countries and 34 borrowing countries between 2000 and 2014, are used in the analysis. The results show that in some countries, the increase of capital requirements is not effective in reducing international credit flows during periods of financial vulnerability. The impact of tightening LTV ratios is more heterogeneous across countries because LTV ratios are mainly used in the housing sector and not all countries change their LTV ratio frequently. Hence, cooperation across countries is necessary but also countries should make sure that the change of macroprudential policies targeting lenders and those targeting borrowers complement each other to avoid international leakages. Chapter 3 analyzes issues related to the international spillover of macroprudential policies through international banking activities using a two-country dynamic stochastic general equilibrium model with heterogeneous and time-varying macroprudential policies. The results show that a combination of capital requirements and LTV ratios is effective in reducing credit growth despite the existence of cross-border banking activities and heterogeneous implementation of capital requirements across countries. In addition, international coordination of capital requirements is also effective in reducing credit growth but less effective than a combination of capital requirements and LTV ratios. Chapter 4 focuses on the role of countercyclical LTV ratios in reducing transmission of shocks when international investors, holding domestic and foreign assets, face collateral constraint. Using a two-country dynamic stochastic general equilibrium model, the analysis demonstrates that time-varying LTV ratios can reduce the transmission of shocks.


2021 ◽  
Vol 14 (10) ◽  
pp. 468
Author(s):  
Peter Zámborský ◽  
Zheng Joseph Yan ◽  
Erwann Sbaï ◽  
Matthew Larsen

The purpose of this paper is to analyze the relationship between home country institutions and cross-border merger and acquisition (M&A) motives of MNEs from the Asia-Pacific region, with a focus on the role of regulatory quality and dynamics. We empirically examine how M&A motives are affected by elements related to risk of the institutional environment of the acquiring firm’s home country regulatory quality over time. The study is grounded in the general theory of springboard MNEs, and the institutional views of cross-border operations, namely the institutional escapism and institutional fostering perspectives. Using data on over 700 cross-border M&As of European firms by Asia-Pacific MNEs in 2007–2017, we analyze the rationales for these deals and their relationship to the institutional characteristics of the buyers’ home countries including regulatory quality and voice and accountability. We found that the quality of home country regulatory environment is significantly related to domestic firms’ motivation for international M&As. However, the significance and sign of the effects differ for different types of motives and over time. Our findings contribute to the literature on general versus emerging MNE-specific internationalization theories (particularly the theory of springboard MNEs) by expounding on the types and dynamics of cross-border M&A motives.


2020 ◽  
Author(s):  
Armand Gutierrez

Abstract This study uses the concept of brokerage to explain how the transnational ties of the children of migrants born in the host country, i.e., the second generation, are initiated and sustained. By examining second generation Mexican- and Filipino-Americans, two groups that differ in linguistic proficiency, geographical proximity to the home country, and interpersonal contact with nonmigrants, this study highlights the common role of a broker for both groups. These findings also reveal the ways in which second generation ties can differ. The second generation utilized middleman brokerage, in which a broker is present throughout each connection; and catalyst brokerage, in which a broker facilitates only the initial ties. Overall, these forms of brokerage were shaped by the type of cross-border connection, linguistic proficiency, interpersonal contact, and emotional attachments between nonmigrants and the second generation. While Filipino-Americans in the sample generally required a middleman broker to be present throughout each connection, Mexican-Americans had a greater capacity to eventually engage in dyadic connections. Given the triadic nature of connections, cross-border ties were shaped and limited by the capacities and emotional attachments of those in the ancestral homeland, immigrant brokers, and the second generation.


2010 ◽  
Vol 104 (3) ◽  
pp. 584-600 ◽  
Author(s):  
DAVID LEBLANG

What explains cross-national patterns of international portfolio and foreign direct investment (FDI)? While existing explanations focus on the credibility of a policy maker's commitment, we emphasize the role of diaspora networks. We hypothesize that diaspora networks—connections between migrants residing in investing countries and their home country—influence global investment by reducing transaction and information costs. This hypothesis is tested using dyadic cross-sectional data for both portfolio and FDI. The findings indicate that even after controlling for a multitude of factors, disapora networks have both a substantively significant effect and a statistically significant effect on cross-border investment.


2021 ◽  
Author(s):  
Doriane Intungane

The recent financial crisis started a global debate on the role of financial policies, which led to financial system reforms in many countries. These reforms mainly consisted of increasing the usage of macroprudential policies. This dissertation seeks to understand whether macroprudential policies in financially integrated countries reduced their vulnerability to the impact of external shocks. Chapter 2 empirically examines the impact of macroprudential policies on cross-border bilateral credit growth. Capital requirements and loan-to-value (LTV) ratios, in 15 lending countries and 34 borrowing countries between 2000 and 2014, are used in the analysis. The results show that in some countries, the increase of capital requirements is not effective in reducing international credit flows during periods of financial vulnerability. The impact of tightening LTV ratios is more heterogeneous across countries because LTV ratios are mainly used in the housing sector and not all countries change their LTV ratio frequently. Hence, cooperation across countries is necessary but also countries should make sure that the change of macroprudential policies targeting lenders and those targeting borrowers complement each other to avoid international leakages. Chapter 3 analyzes issues related to the international spillover of macroprudential policies through international banking activities using a two-country dynamic stochastic general equilibrium model with heterogeneous and time-varying macroprudential policies. The results show that a combination of capital requirements and LTV ratios is effective in reducing credit growth despite the existence of cross-border banking activities and heterogeneous implementation of capital requirements across countries. In addition, international coordination of capital requirements is also effective in reducing credit growth but less effective than a combination of capital requirements and LTV ratios. Chapter 4 focuses on the role of countercyclical LTV ratios in reducing transmission of shocks when international investors, holding domestic and foreign assets, face collateral constraint. Using a two-country dynamic stochastic general equilibrium model, the analysis demonstrates that time-varying LTV ratios can reduce the transmission of shocks.


2014 ◽  
Author(s):  
Peter Mathias Fischer ◽  
◽  
Katharina P. Zeugner-Roth ◽  
Keyword(s):  

2019 ◽  
Vol 18 (Vol 18, No 4 (2019)) ◽  
pp. 439-453
Author(s):  
Ihor LISHCHYNSKYY

The article is devoted to the study of the implementation of territorial cohesion policy in the European Union in order to achieve a secure regional coexistence. In particular, the regulatory and institutional origins of territorial cohesion policy in the EU are considered. The evolution of ontological models of cohesion policy has been outlined. Specifically, the emphasis is placed on the key objective of political geography – effectively combining the need for "territorialization" and the growing importance of networking. The role of urbanization processes in the context of cohesion policy is highlighted. Cross-border dimensions of cohesion policy in the context of interregional cooperation are explored. Particular emphasis is placed on the features of integrated sustainable development strategies.


Author(s):  
Alison Carrol

In 1918 the end of the First World War triggered the return of Alsace to France after almost fifty years of annexation into the German Empire. Enthusiastic crowds in Paris and Alsace celebrated the homecoming of the so-called lost province, but return proved far less straightforward than anticipated. The region’s German-speaking population demonstrated strong commitment to local cultures and institutions, as well as their own visions of return to France. As a result, the following two decades saw politicians, administrators, industrialists, cultural elites, and others grapple with the question of how to make Alsace French again. The answer did not prove straightforward; differences of opinion emerged both inside and outside the region, and reintegration became a fiercely contested process that remained incomplete when war broke out in 1939. The Return of Alsace to France examines this story. Drawing upon national, regional, and local archives, it follows the difficult process of Alsace’s reintegration into French society, culture, political and economic systems, and legislative and administrative institutions. It connects the microhistory of the region with the macro levels of national policy, international relations, and transnational networks, and with the cross-border flows of ideas, goods, people, and cultural products that shaped daily life in Alsace. Revealing Alsace to be a site of exchange between a range of interest groups with different visions of the region’s future, this book underlines the role of regional populations and cross-border interactions in forging the French Third Republic.


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