Financial Integration And Risk Adjusted Growth Opportunities
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Financial Integration and Risk-Adjusted Growth Opportunities
| Author | : Gianni De Nicoló |
| Publisher | : INTERNATIONAL MONETARY FUND |
| Total Pages | : 24 |
| Release | : 2008-05-01 |
| Genre | : |
| ISBN | : 9781451869866 |
This paper documents the evolution of measures of financial integration for major advanced and emerging markets economies, assesses whether advances in integration have had a significant positive impact on countries' risk-adjusted growth opportunities, and identifies some of the channels through which financial integration may foster growth. Three main results obtain. First, financial integration has progressed significantly worldwide, particularly in emerging markets, and regional integration has advanced at the fastest pace in Europe. Second, a country's speed of integration predicts future country's risk-adjusted growth opportunities, while improved risk-adjusted growth opportunities predict future advances in integration, indicating that the countries whose integration has been faster may have benefited most from a virtuous dynamics in which financial integration and improved real prospects are mutually reinforcing. Third, financial integration predicts globalization but the reverse does not necessarily hold, while advances in financial integration predict advances in financial development and improvements in the liquidity of equity markets.
IMF Working Papers
| Author | : Gianni De Nicoló |
| Publisher | : |
| Total Pages | : |
| Release | : 2008 |
| Genre | : Electronic books |
| ISBN | : |
Financial Integration, Entrepreneurial Risk and Global Dynamics
| Author | : George-Marios Angeletos |
| Publisher | : DIANE Publishing |
| Total Pages | : 42 |
| Release | : 2011-04 |
| Genre | : Reference |
| ISBN | : 1437980244 |
How does financial integration impact capital accumulation, current-account dynamics, and cross-country inequality? This paper investigates this question within a two-country, general-equilibrium, incomplete-markets model that focuses on the importance of idiosyncratic entrepreneurial risk -- a risk that introduces, not only a precautionary motive for saving, but also a wedge between the interest rate and the marginal product of capital. This friction provides a simple resolution to the empirical puzzle that capital often fails to flow from the rich or slow-growing countries to the poor or fast-growing ones, and a distinct set of policy lessons regarding the intertemporal costs and benefits of capital-account liberalization. Illus. A print on demand report.
OECD Sovereign Borrowing Outlook 2021
| Author | : OECD |
| Publisher | : OECD Publishing |
| Total Pages | : 94 |
| Release | : 2021-05-20 |
| Genre | : |
| ISBN | : 9264852395 |
This edition of the OECD Sovereign Borrowing Outlook reviews developments in response to the COVID-19 pandemic for government borrowing needs, funding conditions and funding strategies in the OECD area.
Benefits of Global and Regional Financial Integration in Latin America
| Author | : Luc Eyraud |
| Publisher | : International Monetary Fund |
| Total Pages | : 32 |
| Release | : 2017-01-18 |
| Genre | : Business & Economics |
| ISBN | : 1475568681 |
The timing is ripe to pursue greater regional financial integration in Latin America given the withdrawal of some global banks from the region and the weakening of growth prospects. Important initiatives are ongoing to foster financial integration. Failure to capitalize on this would represent a significant missed opportunity. This paper examines the scope for further global and regional financial integration in Latin America, based on economic fundamentals and comparisons to other emerging regions, and quantifies the potential macroeconomic gains that such integration could bring. The analysis suggests that closing the financial integration gap could boost GDP growth be 1⁄4 - 3⁄4 percentage point in these countries, on average.
Globalization and Systemic Risk
| Author | : Douglas Darrell Evanoff |
| Publisher | : World Scientific |
| Total Pages | : 455 |
| Release | : 2009 |
| Genre | : Business & Economics |
| ISBN | : 9812833382 |
The impact of globalization of financial markets is a highly debated topic, particularly in recent months when the issue of globalization and contagion of financial distress has become a focus of intense policy debate. The papers in this volume provide an up-to-date overview of the key issues in this debate. While most of the contributions were prepared after the initial outbreak of the current global turmoil and financial crisis, they identify the relative strengths of the risk diversification and risk transmission processes and examine the empirical evidence to date. The book considers the relative roles of banks, nonbank financial institutions and capital markets in both risk diversification and risk transmission. It then evaluates the current status of crisis resolution in a global context, and speculates where to go from here in terms of understanding, resolution, prevention and public policy.
Financial Integration
| Author | : Robert P. Flood |
| Publisher | : |
| Total Pages | : 20 |
| Release | : 2006 |
| Genre | : |
| ISBN | : |
This paper develops a simple methodology to test for asset integration, and applies it within and between American stock markets. Our technique relies on estimating and comparing expected risk-free rates across assets. Expected risk-free rates are allowed to vary freely over time, constrained only by the fact that they must be equal across (risk-adjusted) assets in well integrated markets. Assets are allowed to have standard risk characteristics, and are constrained by a factor model of covariances over short time periods. We find that implied expected risk-free rates vary dramatically over time, unlike short interest rates. Further, internal integration in the Samp;P 500 market is never rejected and is generally not rejected in the NASDAQ. Integration between the NASDAQ and the Samp;P, however, is always rejected dramatically.
Financial Integration, Growth, and Volatility
| Author | : Anne Epaulard |
| Publisher | : |
| Total Pages | : 44 |
| Release | : 2005 |
| Genre | : Capital movements |
| ISBN | : |
The aim of this paper is to evaluate the welfare gains from financial integration for developing and emerging market economies. To do so, we build a stochastic endogenous growth model for a small open economy that can (i) borrow from the rest of the world, (ii) invest in foreign assets, and (iii) receive foreign direct investment (FDI). The model is calibrated on 32 emerging market and developing economies for which we evaluate the upper bound for the welfare gain from financial integration. For plausible values of preference parameters and actual levels of financial integration, the mean welfare gain from financial integration is about 10 percent of initial wealth. Compared with financial autarky, actual levels of financial integration translate into slightly higher annual growth rates (around 0.4 percentage point per year.).
