How ETFs Amplify the Global Financial Cycle in Emerging Markets

Premiums, Discounts and Feedback Trading: Evidence from Emerging Markets’ ETFs

This study investigates the extent to which ETFs’ premiums and discounts motivate feedback trading in emerging markets’ ETFs. Using a sample of the first-ever launched broad-index ETFs from four emerging markets (Brazil, India, South Africa and South Korea), we produce evidence denoting that feedback trading grows in significance in the presence of lagged premiums. The significance of feedback ...

Emerging Markets Financial Openness and Financial Development

We examine the effect of financial openness on the development of financial systems in a panel of 35 emerging markets during the period of 1976 to 2003. A group of indicators including variables from banking sector, stock market, and national capital accounts are used as measures of financial openness and financial development. In addition, aggregate index measures are developed to incorporate ...

Emerging Markets and Financial Intermediaries

Over the last fifteen years, emerging economies have experienced abrupt changes in bond spreads and large movements in capital flows. We propose a simple general equilibrium model where international investors hire fund managers to invest their capital either in the bonds of an emerging economy or in a riskless asset. We model the emerging economy as a small-open economy subject to an aggregate...

The New Challenge for Global Financial Markets

Financial Stability: an Emerging Markets Perspective

It is a pleasure to participate in this meeting and to speak about the lessons for monetary policy the current crisis is teaching us. The big difference between the current crisis with previous ones in emerging economies is that this time “it was not our fault.” The evidence on the performance of emerging countries facing an unprecedented global downturn shows that some lessons have been proper...