scholarly journals Financial Frictions and Macroeconomy During Financial Crises: A Bayesian DSGE Assessment

2021 ◽  
Vol 24 (2) ◽  
pp. 62-99
Author(s):  
Eric Martial Etoundi Atenga ◽  
Maman Hassan Abdo ◽  
Mbodja Mougoué
Keyword(s):  
Financial Crisis ◽  
Financial Crises ◽  
Global Financial Crisis ◽  
Financial Frictions ◽  
Variance Decomposition ◽  
Macroeconomic Fluctuations ◽  
Financial Shocks ◽  
Empirical Estimates ◽  
The Global Financial Crisis

The recent global financial crisis and the Eurozone sovereign default have rekindled the debate on the interactions between the real sector and the financial sphere. The present paper provides an assessment of the role of financial frictions on business cycles in Canada, the Euro Area, the U.K., and the U.S. during these recent financial crises using an extension of the DSGE methodology described by Merola (2015). The main goal is to examine whether and the extent to which those crises enhanced the contribution of financial frictions in driving macroeconomic fluctuations. The models’ properties are examined with posteriors distributions, variance decomposition, and historical decomposition. Posteriors distributions show that the role of real shocks in driving macroeconomic fluctuations decrease with the incorporation of financial frictions in the core DSGE model. Variance decomposition shows that financial frictions and financial shocks affect the business cycle through investment. The empirical estimates also suggest that the contribution of financial frictions and financial shocks in driving investment increases during the global financial crisis.

A Discussion of Aida H. Hozic and Jacqui True’s Scandalous Economics: Gender and the Politics of Financial Crises

2017 ◽  
Vol 15 (2) ◽  
pp. 503-504
Author(s):  
Dara Z. Strolovitch
Keyword(s):  
Political Economy ◽  
Financial Crisis ◽  
Financial Institutions ◽  
Financial Crises ◽  
Global Financial Crisis ◽  
Economic Order ◽  
Macroeconomic Models ◽  
Gender And Race ◽  
Back Cover ◽  
The Global Financial Crisis

“Critical analyses of the global financial crisis of 2008 (GFC) have neglected the ways in which structural inequalities around gender and race factor into (and indeed make possible) the current economic order. Scandalous Economics breaks new ground by arguing that an explicitly gendered approach to the GFC and its ongoing effects can help us to understand both the root causes of the crisis and the failure to significantly reform financial institutions and macroeconomic models.” These words, from the blurb on the back cover of Scandalous Economics, nicely summarize the book’s topic and the general approach to it. Because the book contains contributions from a number of the top political scientists writing about the gendering of political economy, and because this topic is such an important one, we have invited a range of political scientists to comment on the book and on the broader theme of the gendering of political economy.

A Discussion of Aida H. Hozic and Jacqui True’s Scandalous Economics: Gender and the Politics of Financial Crises

2017 ◽  
Vol 15 (2) ◽  
pp. 511-512
Author(s):  
Daniel W. Drezner
Keyword(s):  
Political Economy ◽  
Financial Crisis ◽  
Financial Institutions ◽  
Financial Crises ◽  
Global Financial Crisis ◽  
Economic Order ◽  
Macroeconomic Models ◽  
Gender And Race ◽  
Back Cover ◽  
The Global Financial Crisis

“Critical analyses of the global financial crisis of 2008 (GFC) have neglected the ways in which structural inequalities around gender and race factor into (and indeed make possible) the current economic order. Scandalous Economics breaks new ground by arguing that an explicitly gendered approach to the GFC and its ongoing effects can help us to understand both the root causes of the crisis and the failure to significantly reform financial institutions and macroeconomic models.” These words, from the blurb on the back cover of Scandalous Economics, nicely summarize the book’s topic and the general approach to it. Because the book contains contributions from a number of the top political scientists writing about the gendering of political economy, and because this topic is such an important one, we have invited a range of political scientists to comment on the book and on the broader theme of the gendering of political economy.

After The Global Crisis, Is It Globalization or Globalonelization?

2015 ◽  
pp. 287-307
Author(s):  
Ayfer Gedikli ◽  
Seyfettin Erdoğan ◽  
Durmuş Çağrı Yıldırım
Keyword(s):  
Emerging Economies ◽  
Financial Crises ◽  
Local Governments ◽  
World Wide ◽  
Global Financial Crisis ◽  
Economic Consequences ◽  
Global Crisis ◽  
The World ◽  
The Global Financial Crisis

Since the rise of globalization which has abolished the role of nation-state gradually, the world has been increasingly dealing with world-wide pandemics and multi-regional financial crises. The nature of the Global Financial Crisis has made it clear that financially integrated and globalized markets which are poorly regulated with lax supervision, can pose significant risks, with disastrous economic consequences. Did global unfairness and loose monetary policy or lack of common fiscal policy deepen the crisis? Is globalization responsible from the loss of power of local governments on their economies? Finally, can “deglobalization” be an alternative solution for the emerging economies? The answers of these questions are even more crucial after the “FED tapering”. In this context, this chapter discusses the future of financial globalization with respect to its effects on the emerging economies during the global crisis.

Dating Banking and Currency Crises in Turkey, 1990-2014

2016 ◽  
pp. 240-273
Author(s):  
Ali Ari ◽  
Raif Cergibozan ◽  
Sedat Demir
Keyword(s):  
Financial Crisis ◽  
Financial Crises ◽  
Early Warning System ◽  
Currency Crises ◽  
Global Financial Crisis ◽  
Empirical Studies ◽  
Banking Crisis ◽  
Warning System ◽  
Turkish Economy ◽  
The Global Financial Crisis

The last two decades characterized by financial crisis episodes have seen a proliferation of empirical studies. These early warning system models allowed researchers to distinguish certain key determinants of financial crises, and helped predicting and preventing the occurrence of some crises. However, crises continue to arise as recently illustrated by the onset of the global financial crisis. This clarifies that there are still a lot to learn about financial crises. In this sense, this paper aimed to compare the performance of several currency and banking crisis indicators within the Turkish economy which underwent severe financial crises in the last twenty years. Different currency crisis indicators performed well by detecting the 1994, 2001 and 2008 currency crises, while banking crisis indicators had significant inconsistencies. However, two banking crisis indicators we developed stand for valuable efforts in dating banking crises by constructing aggregate indexes, and contribute significantly to the empirical crisis literature.

Transparency Regulation in Financial Markets – Moving into the Surveillance Age?

2011 ◽  
Vol 2 (3) ◽  
pp. 305-321
Author(s):  
Iris H-Y Chiu
Keyword(s):  
Financial Crisis ◽  
Financial Markets ◽  
Financial Regulation ◽  
Global Financial Crisis ◽  
Financial Sector ◽  
Regulatory Control ◽  
Legal Reforms ◽  
The Global Financial Crisis ◽  
Risk Oversight

In the wake of the global financial crisis, the trajectory of legal reforms is likely to turn towards more transparency regulation. This article argues that transparency regulation will take on a new role of surveillance as intelligence and data mining expand in the wholesale financial sector, supporting the creation of designated systemic risk oversight regulators.The role of market discipline, which has been acknowledged to be weak leading up to the financial crisis, is likely to be eclipsed by a more technocratic governance in the financial sector. In this article, however, concerns are raised about the expansion of technocratic surveillance and whether financial sector participants would internalise the discipline of regulatory control. Certain endemic features of the financial sector will pose challenges for financial regulation even in the surveillance age.

The impact of the global financial crisis on Millennium Development Goal attainment in Africa

2017 ◽  
Author(s):  
Leah McMillan Polonenko
Keyword(s):  
Financial Crisis ◽  
Goal Attainment ◽  
Global Financial Crisis ◽  
Adequate Funding ◽  
Development Goals ◽  
Education In Ghana ◽  
The Global Financial Crisis ◽  
The Impact ◽  
Global Initiatives

This chapter examines the challenges involved in attaining the Millennium Development Goals (MDGs) in Africa in the wake of the 2008 global financial crisis and highlights important lessons for future financing of global initiatives. The 2008 global financial crisis provided a very important caution: global initiatives are only as good as their global conditions. The crisis had very real consequences for the education sector, particularly through the reduction of adequate funding. The chapter first considers the consequences of the global financial crisis to education, taking into account the role of foreign aid, before discussing the cases of primary education in Ghana and Zimbabwe. It concludes by suggesting some best practices for learning from the failures to education from the 2008 agenda.

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