Global Liquidity Determinants Across Emerging and Advanced Countries
The paper explores the concept of global liquidity and its determinants, focusing on the banking system in advanced and emerging markets. We explore the implications of the interaction between liquidity and its local, global and financial markets determinants. We also analyze the global liquidity...
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| Main Author: | |
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| Format: | Article |
| Language: | English |
| Published: |
University of Warsaw
2015-05-01
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| Series: | Journal of Banking and Financial Economics |
| Subjects: | |
| Online Access: | https://press.wz.uw.edu.pl/cgi/viewcontent.cgi?article=1094&context=jbfe |
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| Summary: | The paper explores the concept of global liquidity and its determinants, focusing on the banking
system in advanced and emerging markets. We explore the implications of the interaction between
liquidity and its local, global and financial markets determinants. We also analyze the global
liquidity channels, i.e. whether foreign banks play a significant role in the country’s financial
system. The study focuses on the investigation of banks’ liquidity determinants in 42 countries
(advanced and emerging/developing countries) over the 2000–2011 period. The results show the
significance of the differences in global liquidity depending on the country’s level of development.
We find support to the conjecture that globalization and global banks’ leverage may convey some
useful information on global liquidity. We also present an important observation that banks’
lending in advanced countries is shielded from the monetary policy because of their ability to
freely access alternative sources of funds. |
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| ISSN: | 2353-6845 |