Suchergebnisse

This short and final empirical chapter looks at net lending flows – incomes minus expenditures – over time for the government, private, and rest of the world "institutional sectors", normalized in all cases by GDP. Long debates and many policy recommendations have followed from the interpretation of how net lending by different sectors relate to each other. We therefore review the conceptual debate first. This also serves as an introduction to the short-term macroeconomic analysis of Chapter 7.

Abstract
Using a novel dataset, I quantify the magnitude of the EU-27 countries' output gap revisions in 2002–2014, and study the implications of this uncertainty for the optimal fiscal policy with a DSGE model. I find that taking into account the output gap uncertainty (i.e. the difficulty to distinguish between cyclical and trend shocks in real time) has large implications for both the net lending and fiscal policy. In the median EU country, the primary net lending turns mildly countercyclical; a feature that is consistent with the data, but contrasts with the procyclical net lending under the full output gap information. The optimal fiscal policy, as measured by the changes in the cyclically-adjusted budget balance (CAB), is cautious and turns from strongly to weakly countercyclical because of the uncertainty. During fiscal crises, the CAB is allowed to deteriorate less and the adjustment of the CAB is gradual, while underestimation of the uncertainty may lead to more volatile policy. The uncertainty generates a substantial amount of cross-country heterogeneity in the dynamics of the total net lending, but not so much in the CAB-based fiscal policy.

The 1997–1998 Asian financial crisis and the 2007–2008 global financial crisis highlighted the need for global and regional financial safety nets to safeguard financial stability and enhance resilience to future crises. Over the past decade, Asian economies have made progress in establishing financing arrangements to strengthen the region's financial safety net. These arrangements have enhanced regional macroeconomic and financial surveillance, strengthened crisis management, and bolstered cooperation for financial stability and resilience. This report examines the evolution and the toolkits of regional financing arrangements and assesses the Asian Development Bank's role in providing crisis response mechanisms through its policy based lending facilities.

Official ending is much larger than commonly known, often surpassing total private cross-border capital flows, especially during wars, financial crises and natural catastrophes. This paper assembles the first comprehensive long-run dataset of official international loans, covering 230,000 loans, grants and guarantees extended by governments, central banks, and multilateral institutions in the period 1790–2015. Historically, wars have been the main catalyst of government-to-government lending. The scale of official credits granted in and around WW1 and WW2 was particularly large, easily surpassing the scale of total international bailout lending after the 2008 crash. During peacetime, development finance and financial crises are the main drivers of official cross-border finance, with official flows often stepping in when private flows retrench. In line with predictions of recent theoretical contributions, this paper finds that official lending increases with the degree of economic integration. In financial crises, governments help those countries to which they have greater trade and banking exposure, hoping to reduce the collateral damage to their own economies. Since the 2000s, official finance has made a sharp comeback, largely due to the rise of China as an international creditor and the return of central bank cross-border lending in times of stress, this time through swap lines.