Santa Cruz, CA, 95064
NBER Working Papers and Publications
|October 2009||The financial crisis and sizable international reserves depletion: From 'fear of floating' to the 'fear of losing international reserves'?|
with Joshua Aizenman: w15308
In this paper we study the degree to which Emerging Markets (EMs) adjusted to the global liquidity crisis by drawing down their international reserves (IR). Overall, we find a mixed and complex picture. Intriguingly, only about half of the EMs depleted their IR as part of the adjustment mechanism. To gain further insight, we compare pre-crisis demand for IR of countries that experienced sizable IR depletion, to that of countries that did not, and find different patterns between the two groups. Trade related factors (such as trade openness, primary goods export ratio, especially large oil export) seem to play a significant role in accounting for the pre-crisis IR/GDP level of countries that experienced a sizable IR depletion during the first phase of crisis. Our findings suggest that countr...
Published: “The financial crisis and sizable international reserves depletion: From 'fear of floating' to the 'fear of losing international reserves'?” (with Y. Sun) International Review of Economics and Finance, 2012, 24, pp. 250-269. citation courtesy of
|January 2008||Globalization and the Sustainability of Large Current Account Imbalances: Size Matters|
with Joshua Aizenman: w13734
This paper evaluates the sustainability of large current account imbalances in the era when the Chinese GDP growth rate and current account/GDP exceed 10%. We investigate the size distribution and the durability of current account deficits during 1966-2005, and report the results of a simulation that relies on the adding-up property of global current account balances. Excluding the US, we find that size does matter: the length of current account deficit spells is negatively related to the relative size of the countries' GDP. We conclude that the continuation of the fast growth rate of China, while maintaining its large current account/GPD surpluses, would be constrained by the limited sustainability of the larger current account deficits/GDP of countries that grow at a much slower rate. Co...
Published: Aizenman, Joshua & Sun, Yi, 2010.
"Globalization and the sustainability of large current account imbalances: Size matters,"
Journal of Macroeconomics,
Elsevier, vol. 32(1), pages 35-44, March.
citation courtesy of