Objective Financial liberalization in emerging markets has not produced the benefits predicted by conventional, neoclassical models. There is consensus that in reality financial frictions must play a larger role than these models anticipated. The objective of this research project is to enhance our understanding of how this happens, emphasizing the interactions between financial integration and the workings of domestic financial markets.The project is structured around a set of related questions. (i) Can these interactions account for the macroeconomic effects of financial liberalization? (ii) How should emerging markets manage financial integration? Should they rely on financial systems that facilitate segmentation between domestic and international markets, as in the 70s and 80s? (iii) What are the implications for the global imbalances that contributed to the recent crisis? Can emerging markets export their vulnerabilities to advanced countries? (iv) Can these interactions explain the appearance of bubbles? What are their effects on the workings of international and domestic financial markets?Gross capital flows reflect risk in domestic financial markets and also raise this risk by increasing the incentives to default. This complementarity is highly destabilizing. (v) Does the recent global financial crisis and associated collapse in gross capital flows reflect such forces? Have they been present in previous crises, particularly in emerging markets?Emerging markets are more financially integrated than during the cold war. But the current situation has an antecedent in the late 19th century. Traditionally, integration is taken as exogenous. I will explore the forces that shape the process of integration. (vi) Is there any relationship between the existence of a hegemonic power, Britain in the late 19th century and the US since the 1980s, and financial integration? (vii) What will be the effect of the ongoing weakening of the hegemonic power of the US? Fields of science social scienceseconomics and businesseconomicsmonetary and financeshumanitieshistory and archaeologyhistorycontemporary history Programme(s) FP7-IDEAS-ERC - Specific programme: "Ideas" implementing the Seventh Framework Programme of the European Community for research, technological development and demonstration activities (2007 to 2013) Topic(s) ERC-SG-SH1 - ERC Starting Grant - Individuals, institutions and markets Call for proposal ERC-2010-StG_20091209 See other projects for this call Funding Scheme ERC-SG - ERC Starting Grant Host institution Centre de Recerca en Economia Internacional (CREI) EU contribution € 900 000,00 Address RAMON TRIAS FARGAS 25/27 08005 Barcelona Spain See on map Region Este Cataluña Barcelona Activity type Research Organisations Principal investigator Fernando Ariel Broner (Dr.) Administrative Contact Anna Rios (Ms.) Links Contact the organisation Opens in new window Website Opens in new window Total cost No data Beneficiaries (1) Sort alphabetically Sort by EU Contribution Expand all Collapse all Centre de Recerca en Economia Internacional (CREI) Spain EU contribution € 900 000,00 Address RAMON TRIAS FARGAS 25/27 08005 Barcelona See on map Region Este Cataluña Barcelona Activity type Research Organisations Principal investigator Fernando Ariel Broner (Dr.) Administrative Contact Anna Rios (Ms.) Links Contact the organisation Opens in new window Website Opens in new window Total cost No data
