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Open Access Publications from the University of California

Scholarly Works (6 results)

  • Article
Working Paper Series (2011)
The accumulated experience of emerging markets over the last two decades has laid bare thetenuous links between external financial integration and faster growth on the one hand and theproclivity of such integration to fuel costly crises on the other. These crises have not gonewithout learning. During the 1990s and 2000s, emerging markets converged to the middleground of the policy space defined by the macroeconomic trilemma, with growing financialintegration, controlled exchange rate flexibility and proactive monetary policy. The OECDcountries moved much faster towards financial integration, embracing financial liberalization,opting for a common currency in Europe, and for flexible exchange rates in other OECDcountries. Following their crises of 1997-2001, emerging markets added financial stability as agoal, self-insured by building up international reserves and adopted a public finance approach tofinancial integration. The global crisis of 2008-09, which originated in the financial sector ofadvanced economies, meant that the OECD “overshot” the optimal degree of financialderegulation while the remarkable resilience of the emerging markets validated their publicfinance approach to financial integration. The story is not over: with capital flowing in droves toemerging markets once again, history could repeat itself without dynamic measures to managecapital mobility as part of a comprehensive prudential regulation effort.
    Cover page: Managing Financial Integration and Capital Mobility— Policy lessons from the past two decades
    • Article
    Recent Work (2004)

    This paper proposes a new method for measuring the degree to which the domestic capital stock is self-financed. The main idea is to use the national accounts to construct a self-financing ratio, indicating what would have been the autarky stock of tangible capital supported by actual past domestic saving, relative to the actual stock of capital. We use the constructed measure of self-financing to evaluate the impact of the growing global financial integration on the sources of financing domestic capital stocks in developing countries. On average, 90% of the stock of capital in developing countries is self financed, and this fraction was surprisingly stable throughout the 1990s. The greater integration of financial markets has not changed the dispersion of self-financing rates, and the correlation between changes in de-facto financial integration and changes in self-financing ratios is statistically insignificant. There is no evidence of any “growth bonus” associated with increasing the financing share of foreign savings. In fact, the evidence suggests the opposite: throughout the 1990s, countries with higher selffinancing ratios grew significantly faster than countries with low self-financing ratios. This result persists even after controlling growth for the quality of institutions. We also find that higher volatility of the self-financing ratios is associated with lower growth rates, and that better institutions are associated with lower volatility of the self-financing ratios. These findings are consistent with the notion that financial integration may have facilitated diversification of assets and liabilities, but failed to offer new net sources of financing capital in developing countries.

      Cover page: Sources for Financing Domestic Capital - is Foreign Saving a Viable Option for Developing Countries?
      • Article
      Working Paper Series (2012)
      This paper examines how financial expansion and contraction cycles affect the broader economy throughtheir impact on eight real economic sectors in a panel of 28 countries over 1960-2005, paying particularattention to large, or sharp, contractions and magnifying and mitigating factors. We find that abruptfinancial contractions are more likely to follow periods of accelerated growth, indicative of ‘up by thestairs, down by the parachute’ dynamics. Sharp fluctuations in the financial sector have asymmetriceffects, with the majority of real sectors adversely affected by contractions but not helped by expansions.The adverse effects of financial contractions are transmitted almost exclusively by the financial opennesschannel with foreign reserves mitigating these effects with a sizeable (10 to 15 times greater) impactduring sharp financial contractions. Both effects are magnified during particularly large financialcontractions (with coefficients on interaction terms two to three times greater than when all contractionsare considered). Consequent upon a financial contraction, the most severe real sector contractions occur incountries with high financial openness; relative predominance of construction, manufacturing, andwholesale and retail sectors; and low international reserves.
        Cover page: Financial Sector Ups and Downs and the Real Sector: Up by the Stairs and Down by the Parachute
        • Article
        Working Paper Series (2004)

        This paper proposes a new method for measuring the degree to which the domestic capital stock is self-financed. The main idea is to use the national accounts to construct a self-financing ratio, indicating what would have been the stock of tangible capital supported by actual past national saving, relative to the actual stock of capital. We use the constructed measure of self-financing to evaluate the impact of the growing global financial integration on the sources of financing domestic capital stocks in developing countries. On average, 90% of the stock of capital in developing countries is self-financed, and this fraction was surprisingly stable throughout the 1990s. The greater integration of financial markets has not changed the dispersion of self-financing rates, and the correlation between changes in de-facto financial integration and changes in self-financing ratios is statistically insignificant. There is no evidence of any “growth bonus” associated with increasing the financing share of foreign savings. In fact, the evidence suggests the opposite: throughout the 1990s, countries with higher self-financing ratios grew significantly faster than countries with low self-financing ratios. This result persists even after controlling growth for the quality of institutions. We also find that higher volatility of the self-financing ratios is associated with lower growth rates, and that better institutions are associated with lower volatility of the self-financing ratios. These findings are consistent with the notion that financial integration may have facilitated diversification of assets and liabilities, but failed to offer new net sources of financing capital in developing countries.

          Cover page: Sources for Financing Domestic Capital – is Foreign Saving a Viable Option for Developing Countries?
          • Article
          • Peer Reviewed
          UC Davis Previously Published Works (2017)
          This study examines moisture sorption behaviors of two glassy polymers, epoxy and vinylester, immersed in different fluids at two temperatures below the glass transition temperatures of the polymers. The main purpose of this study is to understand the effect of volume-dependent temperatures and deformations on the diffusion process of solid polymers. Diffusivity coefficients are first determined by assuming the diffusion to follow the classical Fickian diffusion. In some cases, moisture sorption led to quite significant changes of volume, and the diffusion process cannot be well described by the Fickian diffusion. In such situation, the coupled deformation–diffusion model for linear elastic isotropic materials presented by Gurtin is adopted, as a first approximation. This coupled deformation-diffusion model reduces to a Fickian diffusion model when the coupling parameters are absent and the volume changes in the solid polymers during diffusion are negligible. A finite difference method is used in order to solve for the coupled deformation-diffusion model. The model is used to predict the one-dimensional moisture diffusion in thin plates and the multiaxial three-dimensional moisture diffusion in dogbone specimens. The multiaxial diffusion in the dogbone specimens is used to validate the calibrated material parameters from the standard thin plate diffusion characterization. © 2017 Wiley Periodicals, Inc. J. Appl. Polym. Sci. 2017, 134, 45151.
            Cover page: The effects of temperatures and volumetric expansion on the diffusion of fluids through solid polymers
            • Article
            • Peer Reviewed
            UC Davis Previously Published Works (2016)
            This work describes the application of electrical resistance tomography (ERT) in sensing damage in fiber-reinforced polymer composites under uniaxial quasi-static tension. Damage is manifested as numerous matrix cracks which are distributed across the composite volume and which eventually coalesce into intralayer cracks. Hence, tensile damage is distributed throughout the volume, and could be more significant outside the sensor area. In this work, tensile damage of unidirectional glass fiber-reinforced polymer composites (GFRP) and plain weave carbon fiber-reinforced polymer composites (CFRP) is sensed by utilizing a spray-on nanocomposite sensor, which is then instrumented by boundary electrodes. The resistance change distribution within the sensor area is reconstructed from a series of boundary voltage measurements, and ERT is implemented using a maximum a posteriori approach and assumptions on the type of noise in the reconstruction. Results show that this technique has promise in tracking uniaxial damage in composites. The different fiber architectures (unidirectional GFRP, plain weave CFRP) give distinct features in the ERT, which are consistent with the physical behavior of the tested samples.
              Cover page: Sensing uniaxial tensile damage in fiber-reinforced polymer composites using electrical resistance tomography
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