Emerging Market Economies and Financial Globalization: Argentina, Brazil, China, India and South Korea (Anthem Frontiers of Global Political Economy) ... of Global Political Economy and Development) - Hardcover

Stanley, Leonardo E.

Hardcover

ISBN 10: 1783086742 ISBN 13: 9781783086740

Publisher: Anthem Press, 2018

Synopsis

In the past, foreign shocks arrived to national economies mainly through trade channels, and transmissions of such shocks took time to come into effect. However, after capital globalization, shocks spread to markets almost immediately. Despite the increasing macroeconomic dangers that the situation generated at emerging markets in the South, nobody at the North was ready to acknowledge the pro-cyclicality of the financial system and the inner weakness of “decontrolled” financial innovations because they were enjoying from the “great moderation.” Monetary policy was primarily centered on price stability objectives, without considering the mounting credit and asset price booms being generated by market liquidity and the problems generated by this glut. Mainstream economists, in turn, were not majorly attracted in integrating financial factors in their models. External pressures on emerging market economies (EMEs) were not eliminated after 2008, but even increased as international capital flows augmented in relevance thereafter. Initially economic authorities accurately responded to the challenge, but unconventional monetary policies in the US began to create important spillovers in EMEs. Furthermore, in contrast to a previous surge in liquidity, funds were now transmitted to EMEs throughout the bond market. The perspective of an increase in US interest rates by the FED is generating a reversal of expectations and a sudden flight to quality. Emerging countries’ currencies began to experience higher volatility levels, and depreciation movements against a newly strong US dollar are also increasingly observed. Consequently, there are increasing doubts that the “unexpected” favorable outcome observed in most EMEs at the aftermath of the Global Financial Crisis (GFC) would remain.

About this title

Review:

‘The book is original as it encompasses theoretical chapters, using an international political economy framework as well as case studies of emerging economies in the financial globalization setting.’
―Daniela Magalhães Prates, Associate Professor of Economics, University of Campinas, Brazil

‘This [...] work insightfully analyses the political economic problems entailed by international capital flow and financial globalization, which bring new serious challenges at macro and micro levels to such emerging markets as those in Latin America and Asia.’
―Won-Ho Kim, Dean and Professor, Graduate School of International and Area Studies, Hankuk University of Foreign Studies, South Korea

Book Description:

A comparative analysis of the capital account liberalization process.

About this edition

• Publisher: Anthem Press
• Publication date: 2018
• ISBN 10: 1783086742
• ISBN 13: 9781783086740
• Binding: Hardcover
• Number of pages: 258