Search Results
Working Paper
Crisis, contagion, and country funds: effects on East Asia and Latin America
Spillovers effects, from one country or region to other countries and regions, have attracted renewed attention in the aftermath of the Mexican crisis of December 1994. This paper uses data on closed-end country funds to study how a negative shock in Mexican equities is transmitted to Asia and Latin America, and to particular countries within each region. Country funds allow us to study the transmission to other fund net asset values (NAVs) and prices, which are traded in local stock markets in New York, respectively. The evidence indicates that shocks such as the Mexican crisis produce ...
Working Paper
Trade and growth in East Asian countries: cause and effect?
Estimates of growth equations have found a role for openness, particularly in explaining rapid growth among East Asian countries. But major concerns of simultaneous causality between growth and trade have been expressed. This study aims to deal with the endogeneity of trade by using as instrumental variables the exogenous determinants from the gravity model of bilateral trade, such as proximity to trading partners. Our preliminary finding is that the effect of openness on growth is even clearer when we correct for the endogeneity of openness than in standard OLS estimates. We conclude ...
Working Paper
Liberalized portfolio capital inflows in emerging markets: sterilization, expectations and the incompleteness of interest rate convergence
The paper examines interest rates in nine Latin American and East Asian countries during the period 1987-1994. The goal is to discover why interest rates have remained high, failing to converge to U.S. levels, despite capital market liberalization and a resurgence of portfolio capital inflows during the second half of this sample period. Related questions are whether portfolio capital flows are strong enough to equalize expected returns between these "emerging markets" and the U.S., and whether there is any scope left for the authorities to sterilize inflows. The conclusion of the study ...
Working Paper
On the dollar and the yen
Conference Paper
International capital mobility and exchange rate volatility