Re-examining the Contagion Channels of Global Financial Crises: Evidence from the Twelve Years since the US Subprime Crisis

Hai Jiang*, Shenfeng Tang*, Lifang Li*, Fangming Xu*, Qian Di*

*Corresponding author for this work

Research output: Contribution to journalArticle (Academic Journal)peer-review

15 Citations (Scopus)
56 Downloads (Pure)

Abstract

This study examines the contagion of the US subprime crisis across the world by focusing on four transmission mechanisms: macroeconomic fundamentals, political similarities, international trade and financial linkages. Using spatial analysis and a sample of 36 countries from 2002 to 2018, we find that all four contagion channels contribute to the rapid spread of financial crises around the world, with international trade and financial linkages playing the most prominent roles. Countries with higher inflation and domestic credit or lower exchange rates and current accounts tend to suffer more from financial crises.
Original languageEnglish
Article number101617
Number of pages40
JournalResearch in International Business and Finance
Volume60
Early online date19 Jan 2022
DOIs
Publication statusPublished - 1 Apr 2022

Bibliographical note

Funding Information:
We are grateful to the National Natural Science Foundation of China ( 71973053 , 71803066 ) and Jinan University Research Institute of Finance Base Self-found Project for supporting this research.

Publisher Copyright:
© 2022 Elsevier B.V.

Research Groups and Themes

  • AF Financial Markets

Keywords

  • financial crises
  • contagion channels
  • Spatial econometrics
  • subprime crisis

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