Global Imbalances and Financial Fragility

  • Jong Kook Shin
  • Chetan Subramanian


The global financial crisis of 2008 has brought the role of global imbalances (net capital flows) front and center in the debate on the international economic outlook. The presence of large and sustained current account imbalances has led academics and policy makers to ponder over how big a threat they represent to the global economy. In this note, we argue that it is the gross rather than the net capital flows which are a better indicator of the fragility of the global financial system.


Monetary Policy Central Bank Current Account Real Interest Rate Global Financial Crisis 
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Copyright information

© Springer India 2014

Authors and Affiliations

  1. 1.Management School Riddel HallQueen’s UniversityBelfastUK
  2. 2.Department of Economics and Social SciencesIndian Institute of Management BangaloreBengaluruIndia

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