Abstract
This paper examines two issues that are central to the macroeconomic implications of large external shock for an emerging market economy. First, the paper examines how capital reversal and credit squeeze can reduce aggregate demand that lead to cascading contraction in employment. Secondly, the paper investigates alternative policy options, when an economy is in the depths of financial crisis. What we chose for analytical purpose is an effective model of Blinder-Bernanke type which is modified in several directions so as to examine how financial shocks produce macroeconomic outcomes in a large class of emerging market economies.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
