Can Countries Manage Their Financial Conditions amid Globalization? Evidence from Vietnam
Abstract
This research aims to determine whether global conditions influence the control of Vietnam's national financial condition or not by using internal and external variables. The financial markets in the world have been rapidly integrating into the global market that today the concept of "financial integration" is gradually being replaced by a new broader concept that is "financial globalization". That is considered an indispensable part of the process of economic globalization. However, this level of deepening integration can be seen as a factor increasing the extent of the impact of global financial conditions on financial conditions in each country. This article examines the practice in Vietnam based on comparing the FCI Vietnam index with the FCI Singapore in the period 2000-2020. The research results show that global financial conditions impact Vietnam's national financial condition index in the context of integration. By applying different methods of constructing the financial condition index, the financial condition variables show different relationships with the corresponding FCI curves.
Keywords: financial condition index, financial integration, globalization.
https://doi.org/10.55463/issn.1674-2974.49.4.25
Full Text:
PDFReferences
OBSTFIELD M. Trilemmas and Tradeoffs: Living with Financial Globalization. Bank for International Settlements, Basel, 2015. https://www.bis.org/publ/work480.pdf
KEARNS J., & PATEL N. Does the financial channel of exchange rates offset the trade channel? BIS Quarterly Review, 2016: 95-113. https://www.bis.org/publ/qtrpdf/r_qt1612i.pdf
CALVO S. G., & REINHART C. Capital Flows to Latin America: Is There Evidence of Contagion Effects? In: CALVO G., GOLDSTEIN M., HOCHREITER E. (eds) Private Capital Flows to Emerging Markets After the Mexican Crisis. Institute for International Economics, Washington DC, 1996. https://www.researchgate.net/publication/24115359_Capital_Flows_to_Latin_America_Is_There_Evidence_of_Contagion_Effects
BRUNO V., & SHIN H. S. Cross-border banking and global liquidity. Review of Economic Studies, 2013, 82(2): 535–564. https://doi.org/10.1093/restud/rdu042
FRATZSCHER M. Capital flows, push versus pull factors and the global financial crisis. Journal of International Economics, 2012, 88(2): 341-356. https://doi.org/10.1016/j.jinteco.2012.05.003
DI GIOVANNI J., KALEMLI-OZCAN S., ULU M. F., and BASKAYA Y. S. International Spillovers and Local Credit Cycles, 2017. https://doi.org/10.3386/w23149
REY H. Dilemma not Trilemma: The Global Financial Cycle and Monetary Policy Independence. National Bureau of Economic Research, Cambridge MA, 2015. https://doi.org/10.3386/w21162
AIZENMAN J., CHINN M. D., and ITO H. Monetary Policy Spillovers and the Trilemma in the new Normal: Periphery Country Sensitivity to Core Country Conditions. Journal of International Money and Finance, 2016, 68: 298-330. https://doi.org/10.1016/j.jimonfin.2016.02.008
FORBES K. J., & CHINN M. D. A Decomposition of Global Linkages in Financial Markets over Time. Review of Economics and Statistics, 2004, 86(3): 705–722. https://doi.org/10.1162/0034653041811743
SAHAY R., CIHAK M., N'DIAYE P., BARAJAS A., AYALA PENA D., BI R., GAO Y., KYOBE A., NGUYEN L., SABOROWSKI C., SVIRYDZENKA K., and YOUSEFI R. Rethinking Financial Deepening: Stability And Growth In Emerging Markets. Staff Discussion Notes, 2015, 15(8). https://doi.org/10.5089/9781498312615.006
ALFARO L., KALEMLI-OZCAN S., and VOLOSOVYCH V. Why doesn’t Capital Flow from Rich to Poor Countries? An Empirical Investigation. Review of Economics and Statistics, 2008, 90(2): 347–368. https://doi.org/10.1162/rest.90.2.347
MạNH P. T., & HƯƠNG T. T. T. Nâng Cao Hiệu Quả Hoạt Động Của Doanh Nghiệp Ngành Dệt May Việt Nam Trong Bối Cảnh Hiệp Định EVFTA. Tạp Chí Khoa Học & Công Nghệ Việt Nam, 2021, 63(4): 8–12. https://doi.org/10.31276/VJST.63(4).08-12
ANH T. T. X. Nghiên Cứu Định Lượng Mức Độ Hội Nhập Thị Trường Tài Chính Việt Nam. N.d., 2018.
ARREGUI N., ELEKDAG S., GELOS R., LAFARGUETTE R., and SENEVIRATNE D. Can Countries Manage Their Financial Conditions Amid Globalization? IMF Working Papers, 2018, 15. https://doi.org/10.5089/9781484338612.001
CHINN M. D., & ITO H. Current Account Balances, Financial Development and Institutions: Assaying the World “Saving Glut.” Journal of International Money And Finance, 2007, 26(4): 546-569. https://doi.org/10.1016/j.jimonfin.2007.03.006
OSORIO C., UNSAL D. F., and PONGSAPARN R. A Quantitative Assessment of Financial Conditions in Asia. IMF Working Papers, 2011, 170. https://doi.org/10.5089/9781462314331.001
BAKAR Z.-F. A., & BADRUDIN I. Financial Conditions Index for Malaysia. Bank Negara Malaysia, Quarterly Bulletin, 2017, 3.
IYKE N. B., & JUHRO S. M. Monetary Policy And Financial Conditions in Indonesia. Buletin Ekonomi Moneter Dan Perbankan, 2019, 21(3): 283–302. https://doi.org/10.21098/bemp.v21i3.1005
IYKE N. B. A Test of Efficiency of the Foreign Exchange Market in Indonesia. Buletin Ekonomi Moneter Dan Perbankan, 2019, 21: 439–464. https://doi.org/10.21098/bemp.v0i0.976
DEBUQUE GONZALES M., BAUTISTA G., and SOCORRO M. Financial Conditions Indexes And Monetary Policy in Asia. Asian Economic Papers, 2017, 16(2): 83–117. https://doi.org/10.1162/asep_a_00522
ANH T. T. X., PHUONG N. T., HUONG T. T. T., and MANH P. T. Identifying Financial Condition Indexes For Vietnam. Journal of Southwest Jiaotong University, 2021, 56(6): 196–208. https://doi.org/10.35741/issn.0258-2724.56.6.16
PHUONG N. T., ANH T. T. X., MANH P. T., and HUONG T. T. T. Financial Condition Index Construction Methods and the Problems Posed for Vietnam in The Context of Financial Integration. Banking Science & Training Review, 2021, 224: 15–29.
Refbacks
- There are currently no refbacks.