Research Article
The Heterogeneous Impacts of US’ Monetary Policy Adjustment on Emerging Markets
@INPROCEEDINGS{10.4108/eai.18-11-2022.2326881, author={Chi Gong and Xiaoye Lu and Lu Zhang}, title={The Heterogeneous Impacts of US’ Monetary Policy Adjustment on Emerging Markets}, proceedings={Proceedings of the 4th International Conference on Economic Management and Model Engineering, ICEMME 2022, November 18-20, 2022, Nanjing, China}, publisher={EAI}, proceedings_a={ICEMME}, year={2023}, month={2}, keywords={monetary policy adjustment heterogeneous impacts trade flow capital flow}, doi={10.4108/eai.18-11-2022.2326881} }- Chi Gong
Xiaoye Lu
Lu Zhang
Year: 2023
The Heterogeneous Impacts of US’ Monetary Policy Adjustment on Emerging Markets
ICEMME
EAI
DOI: 10.4108/eai.18-11-2022.2326881
Abstract
In this paper, we examine the impacts of the changes in the monetary policy of US on trade, capital flow, and economy of emerging markets. We find that the impacts vary across the emerging markets in three different regions: Central-East Europe, Latin America, and East Asia. Based on an empirical investigation using Panel-VAR analysis, we reveal that the degree of capital control by emerging markets is a key factor affecting the impacts. Although less capital control will lead to higher volatility on the capital flow of an economy, it may reduce its macro risks. Moreover, we find that the differences in trade openness and the trade structure have little effect on the impacts.
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