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International transmission of financial shocks without financial integration

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  • Ohdoi, Ryoji

Abstract

In a two-country model of Ricardian trade with a continuum of goods and financial frictions, it is shown that a credit crunch in a country can trigger a synchronized economic downturn even in the absence of international financial transactions.

Suggested Citation

  • Ohdoi, Ryoji, 2018. "International transmission of financial shocks without financial integration," Economics Letters, Elsevier, vol. 170(C), pages 46-49.
    • Handle: RePEc:eee:ecolet:v:170:y:2018:i:c:p:46-49
    DOI: 10.1016/j.econlet.2018.05.030
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    Cited by:

    1. Ohdoi, Ryoji, 2020. "Trade, Growth, and the International Transmission of Financial Shocks," MPRA Paper 100756, University Library of Munich, Germany.
    2. Md. Morshadul Hasan & Lu Yajuan & Appel Mahmud, 2020. "Regional Development of China’s Inclusive Finance Through Financial Technology," SAGE Open, , vol. 10(1), pages 21582440199, February.

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    More about this item

    Keywords

    Financial frictions; Ricardian trade with a continuum of goods; Heterogeneous agents; Credit crunch;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F44 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Business Cycles

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