Home About Latest Browse RSS Advanced Search

Federal Reserve Bank of San Francisco
Working Paper Series
International financial remoteness and macroeconomic volatility
Andrew K. Rose
Mark M. Spiegel

This paper shows that proximity to major international financial centers seems to reduce business cycle volatility. In particular, we show that countries that are further from major locations of international financial activity systematically experience more volatile growth rates in both output and consumption, even after accounting for domestic financial depth, political institutions, and other controls. Our results are relatively robust in the sense that more financially remote countries are more volatile, though the results are not always statistically significant. The comparative strength of this finding is in contrast to the more ambiguous evidence found in the literature.

Download Full text
Cite this item
Andrew K. Rose & Mark M. Spiegel, International financial remoteness and macroeconomic volatility, Federal Reserve Bank of San Francisco, Working Paper Series 2008-01, 2007.
More from this series
JEL Classification:
Subject headings:
Keywords: Business cycles
For corrections, contact Noah Pollaczek ()
Fed-in-Print is the central catalog of publications within the Federal Reserve System. It is managed and hosted by the Economic Research Division, Federal Reserve Bank of St. Louis.

Privacy Legal