THE EURO AND THE GEOGRAPHY OF INTERNATIONAL DEBT FLOWS

• 成果类型: Article
• 署名作者: Hale, Galina; Obstfeld, Maurice
• 署名单位: Federal Reserve System - USA; University of California System; University of California Berkeley
• 刊物名称: JOURNAL OF THE EUROPEAN ECONOMIC ASSOCIATION
• ISSN/ISSBN: 1542-4766
• DOI: 10.1111/jeea.12160
• 发表日期: 2016
• 页码: 115-144
• 关键词: financial integration; imbalances; monetary; MARKETS

摘要

Greater financial integration between core and peripheral European Monetary Union (EMU) members not only had an effect on both sets of countries but also spilled over beyond the euro area. Lower interest rates allowed peripheral countries to run bigger deficits, which inflated their economies by allowing credit booms. Core EMU countries took on extra foreign leverage to expose themselves to the peripherals. We present a stylized model that illustrates possible mechanisms for these developments. We then analyze the geography of international debt flows using multiple data sources and provide evidence that after the euro's introduction, core EMU countries increased their borrowing from outside of the EMU and their lending to the EMU periphery. Moreover, we present evidence that large core EMU banks' lending to periphery borrowers was linked to their borrowing from outside of the euro area.