CURRENCY MISMATCHES IN EMERGING MARKET ECONOMIES: IS WINTER COMING?
| Autor: | Gourishankar S. Hiremath, Hari Venkatesh |
|---|---|
| Rok vydání: | 2020 |
| Předmět: |
foreign currency debt
Index (economics) Latin Americans media_common.quotation_subject macroprudential policies monetary independence Monetary economics External debt currency mismatch Independence Original sin Currency lcsh:Finance lcsh:HG1-9999 Openness to experience Economics Finance Panel data media_common |
| Zdroj: | Bulletin Ekonomi Moneter dan Perbankan, Vol 23, Iss 1, Pp 25-54 (2020) |
| ISSN: | 2460-9196 1410-8046 |
| DOI: | 10.21098/bemp.v23i1.1182 |
| Popis: | We develop a currency mismatch index and examine the causes of currency mismatchesin emerging market economies. This study is based on a unique dataset on 22economies from 2008 to 2017. We also construct the original sin index using granulardata on international debt securities. We find Latin American countries, followedby Central European countries, suffer from the original sin and currency mismatchproblems. The panel regression estimates show that country size, trade openness, andthe level of economic and financial development explain cross-country variations incurrency mismatches. Our empirical results suggest that unstable monetary and fiscalpolicies are the primary causes of currency mismatches. The results indicate that abetter institutional environment reduces currency mismatches. These findings call formonetary independence, stable fiscal policy, and macroprudential policy measures tominimize currency mismatches. |
| Databáze: | OpenAIRE |
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