공지사항

Exchange rate regimes and the international transmission of business cycles: Capital account openness matters
Journal of International Money and Finance
Volume 87, October 2018, Pages 44-61
 
Kim, K.(a)Pyun, J.H.(b)
a Korea Institute for International Economic Policy, Building C, Sejong National Research Complex, 370 Sicheongdaero, Sejong-si, 30147, South Korea
b Business School, Korea University, 145 Anam-Ro, Seongbuk-Gu, Seoul, 02841, South Korea



Abstract
We investigate the role of exchange rate regimes in the international transmission of business cycles during the global financial crisis. We find that exchange rate regimes alone did not account for differences in the international transmission of business cycles during the crisis. However, analysis considering capital account openness and countries with currencies pegged to the U.S. dollar indicates that exchange rate regimes play an important role in shaping business cycle co-movement: adopting a fixed regime with high capital account openness(additionally) increased business cycle co-movement with the United States during the crisis, whereas U.S. dollar peggers with relatively restrictive capital accounts during the crisis were not found to affect business cycle transmission. © 2018 Elsevier Ltd



Keywords
Business cycle co-movement;
Capital account openness;
Exchange rate regime;
Global financial crisis;
Trilemma;
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