Xu Zhiwei | International Credit Cycle
December 8-9, 2023，Initiated by the Center for International Finance and Economics Research (CIFER) of Tsinghua University's PBC School of Finance, hosted by Liaoning University, and co-organized by the Center for International Finance and Economics Research (CIFER) and the School of Finance and Trade of Liaoning University, this event..."2023 International Trade Disputes and Globalization Restructuring Academic Symposium"The meeting was successfully held.
Professor at Fudan UniversityXu ZhiweiAttendAssociate Research Fellow at the Institute of World Economics and Politics, Chinese Academy of Social Sciences, and CIFER Research FellowXia GuangtaoHostSub-forum 10: Capital Flows [Online]，Share itWith collaborators, titled "International credit cycleThe article.
Xu Zhiwei, Professor and Doctoral Supervisor, School of Economics, Fudan UniversityShe graduated from the Department of Economics at the Hong Kong University of Science and Technology with a PhD in Economics. Her main research interests include macro-finance and the Chinese economy. She has led projects such as the National Natural Science Foundation of China's Excellent Young Scientists Fund. Her major papers have been published in [Journal Name - not specified].American Economic Journal: Macro, Economic Journal, Journal of Development Economics, Journal of Economic Theory, Quantitative Economicsand journals such as *Economic Research Journal* and *Management World*. Currently serving as... China and World Economy, Economic Modelling Deputy Editor-in-Chief of the Economic Journal.
Xu Zhiwei
In sharing his paper, Xu Zhiwei pointed out that this paper proposes a new transmission mechanism for international financial cycles through cross-border capital flows. The paper establishes an operational model of banking crises in an open economy to understand the international spillover effects of credit cycles. This model is characterized by the heterogeneity and financial constraints of banks in the two countries. Excessive foreign credit expansion may trigger a collapse in its interbank market, leading to capital flight to the home country, the scale of which increases with the abundance of foreign credit. When the home country's banking sector operates normally, capital inflows have a non-monotonic effect on the home country's real economy. Sufficiently large capital flight caused by excessive foreign credit expansion may trigger a credit market collapse, resulting in a discontinuous decline in home country output. The effectiveness of home country responses, such as capital controls and credit policies, depends on the scale and composition of capital inflows. In a fully mature dynamic model, this paper further describes various patterns of international financial risk contagion and endogenous boom-bust credit cycles in the global economy.