Credit constraints and growth in a global economy

Keyu Jin, Stéphane Guibaud and Nicolas Coeurdacier

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We show that in an open-economy OLG model, the interaction between growth differentials and household credit constraints, more severe in fast-growing countries, can explain three prominent global trends: a divergence in private saving rates between advanced and emerging economies, large net capital outflows from the latter, and a sustained decline in the world interest rate. Micro-level evidence on the evolution of age-saving profiles in the U.S. and China corroborates our mechanism. Quantitatively, our model explains about 40 percent of the divergence in aggregate saving rates, and a significant portion of the variations in age-saving profiles across countries and over time

JEL-codes: F21 F32 F41 (search for similar items in EconPapers)
Pages: 73 pages
Date: 2013-04-30
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://eprints.lse.ac.uk/54261/ Open access version. (application/pdf)

Related works:
Journal Article: Credit Constraints and Growth in a Global Economy (2015)
Working Paper: Credit constraints and growth in a global economy (2015)
Working Paper: Credit Constraints and Growth in a Global Economy (2015)
Working Paper: Credit Constraints and Growth in a Global Economy (2015)
Working Paper: Credit Constraints and Growth in a Global Economy (2012)
Working Paper: Credit Constraints and Growth in a Global Economy (2012)
Working Paper: Credit Constraints and Growth in a Global Economy (2012)
Working Paper: Credit constraints and growth in a global economy (2011)
Working Paper: Credit Constraints and Growth in a Global Economy (2011)
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