scholarly journals De-Leveraging and Mitigating Pro-Cyclicality of Capital Flows in Emerging Market Economies: Role of Macro-Prudential Policies

2013 ◽  
Author(s):  
Tolga Dağlaroğlu ◽  
Baki Demirel ◽  
Serdar Varlık
Keyword(s):  
Interest Rates ◽  
Capital Flows ◽  
Foreign Currency ◽  
Emerging Market ◽  
Capital Inflows ◽  
Emerging Market Economies ◽  
Strongly Correlated ◽  
International Capital ◽  
Market Economies

International capital flows have been on an unprecedented roller-coaster ride in recent years. Capital flows to emerging market economies have been strongly correlated with changes in global financing conditions, rising sharply during periods with relatively low global interest rates and low VIX (called risk-on) and shrinking afterward. In open emerging market economies, interest rate increases can attract excessive capital inflows appreciating the exchange rate, and leading to excessive borrowing in foreign currency, and encouraging leverage. A well-designed macro prudential policy prevents credit –driven bubble and mitigating pro-cyclicality of capital flows.

scholarly journals Harinder S. Kohli (ed.). Growth and Development in Emerging Market Economies: International Private Capital Flows, Financial Markets and Globalisation. New Delhi: Sage Publication 2008. 369 pages. Hardbound. Indian Rs 695.00.

2007 ◽  
Vol 46 (3) ◽  
pp. 304-305
Author(s):  
Henna Ahsan
Keyword(s):  
Capital Flows ◽  
Growth And Development ◽  
Global Economy ◽  
Emerging Market ◽  
Emerging Market Economies ◽  
New Delhi ◽  
Infrastructure Development ◽  
International Capital ◽  
Market Economies ◽  
Trade And Investment

The book discusses the different experiences in Asia and Latin America, while covering the closely related areas under the purview of Emerging Market Economies (EMEs). The first chapter, “Introduction and Overview” has written by Harinder S. Kohli gives an excellent review of the existing literature on the subject. The book discusses six related topics which include nine papers presented at the Emerging Markets Forum Meeting held in Jakarta, Indonesia, in September 2006. The book highlights the main factors of growth and development in Emerging Market Economies (EMEs) now closely related with international capital flows, development of financial market, the countries’ ability to integrate successfully with the global economy through trade and investment and their ability to forge public-private partnerships including infrastructure development.

scholarly journals Capital Flows and Growth in Emerging Market Economies: The Case of Turkey

2013 ◽  
Author(s):  
Ercan Uygur
Keyword(s):  
Capital Flows ◽  
Emerging Market ◽  
Capital Inflows ◽  
Policy Implications ◽  
Emerging Market Economies ◽  
Market Economies ◽  
Long Run ◽  
Total Capital ◽  
Advanced Economies ◽  
Recent Developments

Since May 2013, we have witnessed sudden stops and large reversals in the flow of capital to the emerging market economies (EMEs). What we have witnessed is the reversal of the surge of capital that started in 2009 from the advanced economies to the emerging ones, as has been expected. The episodes of capital surges and retrenchments have been observed repeatedly in the last three decades. In this period, capital flows across countries have increased dramatically, but their fluctuations and volatility have been even more dramatic. Furthermore, these flows have played an increasingly important role in the business cycles of both advanced economies and EMEs and during episodes of crises. Why then, in spite of cycles and crises, there is free flow of capital to EMEs? One answer is that these flows might be used to finance investments and to contribute to the long run growth of the EMEs. The basic aim of this paper is to examine the validity of this assertion. Thus, the paper attempts to establish the effect of capital flows on the growth performance of the EMEs, with special reference to Turkey. After a survey of research on the subject, the paper first provides an account of the recent developments in international capital flows. The paper concentrates more on capital flows to Turkey in terms of categories, namely, foreign direct investment, portfolio investment and credit flows. The paper then empirically investigates the effect of these three categories and total capital inflows on the growth of the EMEs. Policy implications of the findings are also discussed.

Harinder S. Kohli (ed.). Growth and Development in Emerging Market Economies: International Private Capital Flows, Financial Markets and Globalisation. New Delhi: Sage Publication 2008. 369 pages. Hardbound. Indian Rs 695.00.

2008 ◽  
Vol 47 (3) ◽  
pp. 304-305
Author(s):  
Henna Ahsan
Keyword(s):  
Capital Flows ◽  
Growth And Development ◽  
Global Economy ◽  
Emerging Market ◽  
Balance Sheet ◽  
Emerging Market Economies ◽  
New Delhi ◽  
Infrastructure Development ◽  
Market Economies ◽  
Emerging Market Countries

The book discusses the different experiences in Asia and Latin America, while covering the closely related areas under the purview of Emerging Market Economies (EMEs). The first chapter, “Introduction and Overview” has written by Harinder S. Kohli gives an excellent review of the existing literature on the subject. The book discusses six related topics which include nine papers presented at the Emerging Markets Forum Meeting held in Jakarta, Indonesia, in September 2006. The book highlights the main factors of growth and development in Emerging Market Economies (EMEs) now closely related with international capital flows, development of financial market, the countries’ ability to integrate successfully with the global economy through trade and investment and their ability to forge public-private partnerships including infrastructure development. Chapter 2, of the book is an article titled “Global Imbalances, Oil Revenues and Capital Flows to Emerging Market Countries” by Jack Boorman explains the favourable global environment and its impact on capital flows to Emerging Market Countries (EMCs). The EMCs got advantage from this benign global economic environment, such as high economic growth rate, increase in exports, better national balance sheet and increase in foreign exchange reserves, but due to high oil prices the situation has been changed.

scholarly journals The Main Determinants of Capital Inflows in Emerging Market Economies: Does the Exchange Rate Regime Matter?

2020 ◽  
Vol 6 (2) ◽  
pp. 163-167
Author(s):  
Fatma Taşdemir
Keyword(s):  
Exchange Rate ◽  
Exchange Rate Regime ◽  
Emerging Market ◽  
Capital Inflows ◽  
Emerging Market Economies ◽  
Foreign Direct Investments ◽  
Market Economies ◽  
Real Gdp ◽  
Long Run ◽  
Main Determinants

There is a bulk of literature in analyzing the impacts of exchange rate regimes (ERRs) on capital flows into emerging market economies. However, these studies mainly do not take into account integration and cointegration properties of variables. This paper aims to tackle this important issue by investigating whether ERRs matter for the impacts of the main push (global financial conditions, GFC) and pull (real GDP) factors on capital inflows into emerging market economies. We find that worsening GFC decreases all types of capital inflow except foreign direct investments in case of floating ERR. This impact is statistically significant only for portfolio inflows in case of managed ERR. The pull factor is often positive and statistically significant in determining capital inflows in the long-run only under floating ERRs. These results suggest that the long-run impacts of the main pull and push factors on capital inflows are often magnified under more flexible ERRs.

Growth Prospects for Advanced and Emerging Market Economies

2016 ◽  
Vol 16 (4) ◽  
pp. 599-614 ◽  
Author(s):  
Dominick Salvatore
Keyword(s):  
Financial Crisis ◽  
Interest Rates ◽  
Global Financial Crisis ◽  
Emerging Market ◽  
Emerging Market Economies ◽  
Fiscal Stimulus ◽  
Secular Stagnation ◽  
Market Economies ◽  
The World ◽  
Growth Prospects

This paper examines the reasons for the slow growth in the advanced countries since the recent global financial crisis, the slowdown in growth or recession in emerging market economies, the danger that the world may be drifting toward a new global financial crisis, and that it may face even secular stagnation. The paper concludes that growth is likely to remain slow for the rest of this decade in advanced countries and to continue to decline in emerging market economies. It also examines the danger that with interest rates at the zero-bound level in advanced nations, a new financial bubble may be in the making as investors, in search of returns, undertake excessively risky investments, and that this may lead to a new global financial crisis. It is not certain, however, that the world is facing secular stagnation and, if so, that a new massive fiscal stimulus (as advocated but some) would prevent it or correct it.

Capital Flows, Asset Prices and Output in Emerging Market Economies

2015 ◽  
Vol 50 (1) ◽  
pp. 1-20
Author(s):  
Ranjanendra Narayan Nag ◽  
Sayan Baksi ◽  
Sayantan Bandhu Majumder
Keyword(s):  
Capital Flows ◽  
Asset Prices ◽  
Emerging Market ◽  
Emerging Market Economies ◽  
Market Economies
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