Research Theme
The Mechanism and Stability of Global Imbalances
Lead Researcher
Prof. Tomoo KIKUCHI
(1)Objective
Most economies in East Asia have run current account surpluses while the United States run deficits over the past decades leading to global imbalances. Meanwhile, the GDP share of economies in Asia in the world has dramatically increased, but that of the United States has declined. However, global finance is still dominated by the United States, who is the largest debtor in the world. The purpose of this project is to investigate theoretically and empirically the channels how various international capital flows – foreign direct investment, portfolio investment, reserves, and other investment – interact with macroeconomic variables and affect economic development of both investing and host countries, and thereby examining the mechanism and stability of global imbalances.
(2)Significance
By investigating the determinants and mechanisms of international capital flows we would like to understand how sustainable the current dominance of the United States in global finance is. Equally important is to understand how the region depends on the global capital market for economic development. More than Europe the region might be vulnerable to changes in the status quo without a unified currency and strong regional institutions. Through our research we would like to draw policy implications for regional financial integration.
(3)Method
The research group plans to hold seminars and conferences to exchange ideas and receive feedback on ongoing research projects. We also plan to hold public lectures for a wider dissemination of our research projects and results.
(4)Expected Outcome
We would like to facilitate research collaboration among the group members with an aim of publishing papers in top journals in the field of international economics.
