Regional Financial Arrangements in the Global Financial Safety Net: The Arab Monetary Fund and the Eurasian Fund for Stabilization and Development

The so‐called global financial safety net provides backstop insurance during financial crises. The three elements of the global safety net — the IMF, regional financial arrangements (RFAs) and bilateral swap agreements — underwent substantial changes after the global financial crisis. How have these changes influenced their use? What role do RFAs have in the safety net? This contribution addresses these questions by examining the timeliness, volume and policy conditionality of liquidity provision of each of the three elements, using a data set of 50 RFA member countries from the period 1976–2015. The article presents case studies of the Arab Monetary Fund (AMF) and the Eurasian Fund for Stabilization and Development (EFSD) to create a deeper institutional understanding of the governance mechanisms of regional funds. The authors find that today's global financial safety net produces inequalities in emergency liquidity provision. In terms of volume, RFAs improve the safety net only for small member countries — about one‐third of the countries in the sample can access sufficient liquidity regionally. The experiences of AMF and EFSD demonstrate that intra‐regional asymmetries of RFAs play a contradictory role: while the participation of large economies leverages liquidity provision, it simultaneously creates difficulties for the governance of the regional body.     

EMU versus the regions? Regional convergence and divergence in Euroland

There is currently considerable interest in and debate overthe impact of increasing European economic and monetary integration(EMU) on the regions of the EU. Opinion is sharply divided overwhether EMU is leading to regional economic convergence or regionaleconomic divergence. This paper examines the theoretical argumentsand empirical evidence for these opposing views, and presentssome additional analysis of patterns of regional productivitytrends and employment growth over the period 1975–98.The picture that emerges is a complex one: whilst worker productivityshows only very weak convergence across the EU regions (a processwhich halted altogether after the mid-1980s), regional employmentgrowth has been sharply divergent. Although there is littlesupport for the claim that EMU will lead to regional convergence,these findings suggest that until much more detailed investigationof the specific impacts on particular types of region is undertaken,the regional implications of EMU will remain a contentious issue.     

Shifts in the Global Capitalist Economy and the National Economic Domain

The greater part of regional development theory and thinking focuses most attention either upon spatial structure within nation states or upon inherent tendencies/free market forces within capitalist social formations/domestic economies. The great significance that is attached to the nation state is entirely understandable in terms of the historical specificity of the re-emergence of regional development studies in the post-war era. It is, however, no longer a sufficiently adequate basis for analysis Rather, it is necessary to commence analyses with a consideration of shifts in the global capitalist economy. Whilst the significance of the impacts of the growth in the internationalisation of production have been noted, more attention needs to be devoted to shifts from public to private economic power and from order to disorder in international finance markets. These shifts are not accidental They can be traced to internal weaknesses and inconsistencies in the Bretton Woods arrangements which eroded their ultimate foundation, that of monetary stability. As one consequence, the unregulated growth of private economic power, endemic instability and extreme volatility in international finance markets have all directly and indirectly undermined and eroded the extent of control over domestic economic policy on the part of the nation state     

REGIONAL FINANCIAL SEGMENTATION IN THE UNITED STATES*

ABSTRACT. Responding to continuing discussions in this Journal regarding the importance of regional money supply and credit, a simple reduced-form regional money supply model is posited and an investigation of real regional money supplies is performed for several states around the country. Hypothesis tests are performed regarding the question of regional financial market segmentation, concluding that segmentation still exists in the United States. The empirical results also imply that interregional trade, presumably via the consequent constraint on regional banks, has at least as much effect on regional money supplies as Federal Reserve policies. These results lend further support for the assertion that regionally available money matters at the local level, and that regional analysis should continue to include regional money and credit as explanatory variables. The implications for policy makers are that: 1) national monetary policy cannot cure regional ills if the problems are manifested in regional industry mixes; and 2) some proposed banking reforms now being debated in Congress, i.e, nationwide branch banking and, particularly, industrial ownership of banks, are suspect. A healthy caution is warranted without more tests of these reforms.     

Monetary and Multidimensional Child Poverty: A Contradiction in Terms?

Although the multidimensional nature of poverty is widely recognized, the extent to which monetary measures can serve as a proxy for non‐monetary measures remains unresolved. This is of particular concern for children given their dependence on others for fulfilment of basic needs and assumptions about intra‐household distribution that underpin monetary measures. This article adopts an innovative mixed‐methods approach to investigate child poverty overlap and mismatch in the low‐ and middle‐income countries of Ethiopia and Vietnam using secondary longitudinal survey data and primary qualitative data from adults and children. Findings indicate that monetary and multidimensional poverty are distinct constructs that are linked, but cannot serve as a proxy for one another. While the degree of dissonance depends on the types of indicators under consideration, poverty mismatch persists regardless of time, place and multidimensional measure under consideration.     

The lagging regions of the EC in the face of economic and monetary union

Nationwide economic policies required to satisfy the Treaty of Maastricht will have a deep regional impact. This paper reflects on the trade‐offs, possibilities and transformations which the process leading towards economic and monetary union imposes on the development policies of peripheral regions. The space left for regional policy is reduced. Regional governments of peripheral regions should decode the pseudo‐modernizing language of neo‐liberal positions, press for greater fiscal resources and propose supply strategies within the framework of industrial policies on a regional basis.     

ON THE IMPACT OF LABOR MARKET MATCHING ON REGIONAL DISPARITIES*

ABSTRACT We propose a model where imperfect matching between firms and workers on local labor markets leads to incentives for spatial agglomeration. We show that the occurrence of spatial agglomeration depends on initial size differences in terms of both number of workers and firms. Allowing for dynamics of workers' and firms' location choices, we show that the spatial outcome depends crucially on different dimensions of agents' mobility. The effect of a higher level of human capital on regional disparities depends on whether it makes workers more mobile or more specialized on the labor market.     

从货币流通量看清代前期的经济增长与波动

The eighteenth century was the heyday of Chinese traditional economic development, that the monetization and sharp increase in the supply of silver stimulated long-distance trade and the rise of regional merchants groups, and increased industrial and agricultural production all reflecting the overall economic development of this period. Along with commoditization and monetization of the economy, monetary supplies and government financial behavior had increasing influence on the economy. The shortage of monetary supplies gave rise to three economic depressions: the early years of the Qing Dynasty, Jiaqing’s reign, and Daoguang’s reign. This study clearly indicates that the scholarly debate over the “stagnation” or “growth” of the Qing economy perhaps merely depends on the period of time and aspect of the economy one examines. The two viewpoints can be somewhat reconciled. Translated by Feng Mei from Qingshi Yanjiu 清史研究 (Studies in Qing History), 2008, (3): 24–43     

Malaysia and the End of the Bretton Woods System 1965–72: Disentangling from Sterling

This article examines the tense and complex monetary relationship between Britain, Singapore and Malaysia in the period from 1965 to 1972. It questions the assumption that Malaysia's economic significance to Britain was ‘on the wane’ by the 1960s. As the second largest government holder of sterling assets in the world, Malaysia should have been able to exert considerable leverage in London over the disposition of these assets. Ultimately, however, the very scale of these assets limited Malaysia's room for manoeuvre, as it could not sell off a significant proportion of them without undermining international confidence in the exchange rate of the pound and thereby precipitating the devaluation of its remaining sterling assets. The devaluation of sterling in 1967 emerges as a watershed in relations between London and Kuala Lumpur, with the Malaysians thereafter seeking to forge a more independent monetary policy. It is clear, however, that they did not actually succeed in doing so until 1972.     

The Duration of Book Credit in Colonial New England

Account books show that merchants frequently used book credit in exchanges with consumers. The ability of credit to act as a substitute for currency in payments depends on the terms attached to the credit, such as its duration. To investigate duration more systematically, the author employs life table analysis and the singulate mean age at marriage, methods commonly used in demography, to analyze debt records from eighteenth-century Connecticut and Massachusetts. He arrives at expected duration estimates in excess of those in the literature. Given the expected duration, book credit seems to be a good substitute for other forms of payment. If this is so, a major revision of literature on colonial monetary matters may be in order.     

物流地理学研究内容与趋势评述

在对物流地理学产生的基础学科交通地理学、物流管理学研究综述基础上,分析交通地理学、物流管理学与物流地理学在研究目的、领域与方法等方面的联系与差异,阐明物流地理学研究对象、内容与方法,进而提出我国物流地理学的发展方向:现代物流区域效应研究、基于现代物流的经济组织空间结构再造及内在机理研究、产业与大型企业物流网络空间优化模型研究、区域物流体系规划研究。     

Remaking the architecture: the emerging powers,self‐insuring and regional insulation

This article examines the interaction between the emerging and traditional powers in global governance reform, and asks whether we are heading towards an international financial system that is more fragmented, where power is more diffused and national and regional arrangements play a more prominent role, at the expense of global multilateral institutions. It begins with a brief discussion of the global systemic and country‐specific factors that motivate Brazil, China and other emerging countries to accumulate large currency reserves. We find that national arrangements for managing financial and currency crises will continue to hold sway for emerging countries in the wake of the global crisis. However, the actual capacity of regional arrangements in managing future financial crises is uncertain, and the significance of regional alternatives in the emerging architecture should not be overstated. The real capacity of East Asian regional arrangements to manage financial crises, payments problems or currency attacks is still untested, and key thresholds in multilateralization still lie ahead. In South America, multilateral lender‐of‐last‐resort support inside the region is largely confined to the sub‐regional level and is limited by Brazil's reticence. Enduring reliance on bilateral measures for financial crisis management is noted. Where there has been progress in regional solutions, since the global crisis, has been in the role of regional development banks in providing financing for developing countries to enact counter‐cyclical policies. Such support also provides insulation for states in the region against the contagion effects of international financial crisis. We are in the midst of transitioning to a more diverse and multi‐tiered global financial and monetary system. A reformed IMF could have a role to play in addressing global imbalances and encouraging a shift from national reserves to collective insurance, however, it would be preconditioned by significant shifts in the policy, lending operations, and internal governance of the Fund, and willingness among the G20 to strike a new consensus on how to deal with imbalances, and new accommodation on acceptable reserve levels.     

Bank Liquidity Creation in Russia

Two EU-based senior economists analyze the contribution of bank liquidity creation to the Russian economy, as well as changes in creation of liquidity occurring during the global financial crisis. Applying the methodology of Berger and Bouwman's (2009) study of U.S. banking to a rich panel dataset for Russian banks for the period 1999-2009, the authors compute three alternative measures of bank liquidity creation. They find evidence of increased creation of liquidity in real terms over the period and also determine that state-controlled (versus private) banks and Russia's largest banks (versus intermediate-size and small banks) contributed most to liquidity creation (lower in Russia than in the U.S.). Their findings suggest that consolidation of the Russian banking sector may prove more instrumental in increasing liquidity creation than privatization per se.     

Who is in control of the international monetary system?

Although the financial and economic crisis did not directly hit the international monetary system, it has lead to the rethinking of the overall architecture that underpins the world economy. Can the current system of floating currency blocs with dollar‐based trade and reserves withstand the strains of the global adjustment ahead? It is time to consider alternatives. This article argues that the existing system needs to evolve into a multicurrency one in which a number of international currencies, ideally representing the main trading areas, have the function of storing value and providing the unit of measure. A multicurrency system would respond more flexibly to the demand for liquidity and would provide a way to diversify the accumulation of reserve assets. It is also more appropriate for the increasingly multipolar world economy. The article discusses how in today's larger and more integrated world economy the dependence on the dollar as the basis of both trade flows and financial reserves has become excessive, creating some fundamental imbalances. However, while the rationale for change is clear, the current system is locked in a form of stable disequilibrium where the status quo carries the lowest risk for most players in the short‐term. Any abrupt move away from the dollar could trigger trade flow disruption and exchange value losses. Policy cooperation should keep the imbalances under control and manage the transition to a more stable system. The system will evolve, albeit gradually. Looking at the steps taken by some countries, notably China, there is the gathering impression that this decade is one of transition, rather than a ‘Bretton Woods moment’. Any reshaping will have to bring in the views of the ‘rising powers’, China in particular, and their concerns about the limitations of the existing system and the increasingly asymmetric burden of adjustment that it imposes.     

Geographies of Monetary Exclusion in Kenyan Slums: Financial Inclusion in Question

Financial inclusion has become a prominent development policy objective. Its promotion rests on the understanding that poverty and underdevelopment mainly result from financial constraints that individuals face. Better access to financial services, in particular via the use of mobile money services, is supposed to lift these constraints and allow for growth and development. After outlining this dominant approach and detailing its theory of change, this article challenges it on the basis of the mesoeconomic study (at territorial level) of areas particularly targeted by financial inclusion policies: Kenyan informal settlements. The study of their geography of money shows how the socio-spatial flows of money shape people's economic constraints and opportunities. Based on this empirical account, it is argued that the poor are, first and foremost, in a situation of monetary exclusion, rather than being primarily financially constrained. The article conceptualizes monetary exclusion and highlights the theory and policy implications of this situation.     

Interactions between urban systems and localized productive systems: An approach to endogenous regional development in terms of innovative milieu

From the 1970s onwards, the regional development suffers a change in its nature: it becomes more and more endogenous. The transition from a perspective of development from above to a perspective of development from below, and the transition from a problematic of redistribution to a problematic of resources creation, need more than a readjustment of the existing regional theories. It turns out to be necessary to focus on the endogeneization of the development mechanism, i.e. on the interactions leading to transformations and adaptations of localized production systems. In fact, it is a matter of building up theories of change that would be able to explain how a region can generate mechanism of wealth creation from its specific resources. Now, these different processes are closely connected to urban organization and their implementation depends on the milieu (i.e. innovative or non‐innovative).     

东亚经济一体化现状与趋势分析

本文以1985-2005年的经济数据和相关理论模型分析为基础,较为系统地探讨了东亚经济一体化的进展和未来趋势,并着重从东亚区域内贸易发展与贸易结构、资本流动、区域经济的货币金融相关度、区域一体化的福利效应和推进一体化的制度安排等方面进行了定量分析和政策探讨。     

梯度理论综述

作为区域经济学的主要理论之一-梯度理论自20世纪70年代创立以来受到了诸多经济学家的关注,其理论基础也得以不断完善和巩固。该理论自20年世纪80年代初引入我国以来,在我国的经济战略制定中发挥了很重要的作用。随着其在我国经济社会中的实践,它也经历了传统(狭义)梯度理论、反梯度理论、广义梯度理论等诸阶段的演变,而每一个理论发展阶段都是对已有理论的重新审视和扬弃。以梯度理论的产生、发展演变为脉络,围绕该理论在不同发展阶段的代表性观点进行了归纳、总结梳理,并对传统(狭义)梯度理论、反梯度理论、广义梯度理论进行了简单评论。     

我对区域经济地理学的认识与几点实践体会

本文介绍了作者近半个世纪从事经济地理,尤其是区域经济地理学习、教学和科学研究实践的历程,对区域经济地理学科理论与实践的探索,是作者一生的主要学术活动领域。文中介绍了作者在区域经济地理研究中五个方面的贡献,总结了在教学与科学研究实践中的四点切身体会。科学的事业是万古长青的,建设具有中国特色的区域经济地理学科理论体系和方法论体系,还任重而道远,还须有志者进行长期艰苦的努力。作者的学习、教学与科学实践经历对青年学者或许有一定的借鉴作用。     

Scale economies and the geographic concentration of industry

In recent empirical literature on spatial agglomeration, manypapers find evidence consistent with location-specific externalitiesof some sort. Our willingness to accept evidence of agglomerationeconomies depends on how well key estimation problems have beenaddressed. Three issues are particularly troublesome for identifyingagglomeration effects: unobserved regional characteristics,simultaneity in regional data, and multiple sources of externalities.Two empirical results appear to be robust to problems createdby the first two issues: (a) individual wages are increasingin the presence of more-educated workers in the local laborforce, which is consistent with localized human-capital externalities,and (b) long-run industry growth is higher in locations witha wider range of industrial activities, which suggests thatfirms benefit from being in more diverse urban environments.Other evidence is supportive of agglomeration effects relatedto regional demand linkages and short-run, industry-specificexternalities.