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The Influence of “Big Brothers :, ” How Important are Regional Factors for Uruguay?, Sebastian Sosa

This paper examines the role played by regional factors in Uruguay, identifies the sources and transmission mechanisms of shocks stemming from the region, and assesses how vulnerable Uruguay is to a potential crisis in the region. Using a VAR model with block exogeneity restrictions, it finds that shocks from Argentina-which account for about 20 percent of Uruguayan output fluctuations-have large and rapid effects. This is mainly due to the existence of idiosyncratic real and financial linkages between Uruguay and Argentina, which also explain the very high correlation between their business cycles. The analysis of previous crises in the region suggests that despite the importance of these strong linkages, and despite the fact the two deepest crises in recent Uruguayan history followed crises in Argentina, Uruguay is now clearly less vulnerable to financial contagion from the region
Table Of Contents
Cover Page; Title Page; Copyright Page; Contents; I. Introduction; II. Literature Review; III. Regional Linkages: The Influence of "Big Brothers"; A. Regional Business Cycle Comovements; B. Idiosyncratic Linkages Between Uruguay and Argentina; IV. How Important are Regional Factors? An Econometric Approach; A. The Empirical Approach; B. Estimation Results; V. How Vulnerable is Uruguay to a Crisis in the Region? A Case Study Approach; A. Crisis Episodes in the Region: A Closer Look; B. How Vulnerable is Uruguay Today to Disruptions in the Region?; VI. Final Remarks; Appendix; References
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (43 p.)
Specific Material Designation
Form Of Item

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