Coping in the subprime region

Gabor, D. (2010) Coping in the subprime region. The Journal of Development Studies. ISSN 0022-0388 Available from: http://eprints.uwe.ac.uk/12562

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Abstract/Description

This paper focuses on Eastern Europe’s experience before and during the 2007-2009 crisis to discuss emerging countries’ options to address global liquidity cycles. It argues that sequencing strategies envisaging capital controls as last-resort option can have perverse effects where banks play multiple roles: from intermediaries of capital inflows to directly accessing global interbank markets to fund foreign-currency lending. A strategy combining sterilizations at long-term maturities with the creation of narrow banks to support sovereign debt dynamics and caps on foreign-currency exposure would contain banks’ involvement in carry trades, curb innovations seeking to circumvent capital controls and restore policy autonomy.

Item Type:Article
Uncontrolled Keywords:emerging countries, financial crisis, central bank liquidity management, quantitative easing, financialized globalization, sovereign debt markets
Faculty/Department:Faculty of Business and Law > Department of Business Management
ID Code:12562
Deposited By: Dr D. Gabor
Deposited On:20 Dec 2010 14:51
Last Modified:15 Nov 2016 23:11

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