Structural Economic Model for Ecuador: a Dollar-ized and Oil-ized

El trabajo desarrolla un Modelo Estructural con las principales características macroeconómicas de la economía ecuatoriana. Modela los principales canales de transmisión de una economía pequeña, abierta y dolarizada, altamente dependiente de la producción de petróleo y las remesas del exterior. Se estima por métodos bayesianos para el período 2001-2010. El modelo permite analizar los principales riesgos que afectan el desempeño macroeconómico, incluyendo los shocks externos. También se subraya el efecto de la política fiscal así como el papel independiente y significativo del valor agregado petrolero en la economía doméstica.The paper develops a Structural Model with the main macroeconomic features of the Ecuadorian economy. It models the main transmission channels of a small open and dollarized economy, highly dependent on oil production and foreign remittances. It is estimated by Bayesian methodsfor the period 2001- 2010. The framework highlights the main risks affecting the macroeconomic performance, including the importance of international shocks. It also underscores the importance of the fiscal policies and the independent and significant role of the oil value added in the domestic economy.Facultad de Ciencias Económica

Risky Banking: Optimal Loan Quantity and Portfolio Quality Choices

In this paper we construct a model of a "risky bank". The bank faces excess demand in the loan market, can sort loan applicants by an observable measure of quality, and faces a small but positive probability of default on its loan portfolio. The bank uses two policies to allocate credit: - Tighten restrictions on loan quality - Limit the number of loans of a given quality We show that the level of default risk and other structural conditions have important e®ects on the market for loanable funds and the bank's optimal policies (loan rates, deposit rates, and lending standards). The structural conditions that we examine are monitoring costs, returns on alternative investments, firms' minimum funding requirements, and the level of the reserve requirement. The model provides insight into several stylized facts observed in loan markets, especially in developing countries.Facultad de Ciencias Económica

Risky Banking: Optimal Loan Quantity and Portfolio Quality Choices

In this paper we construct a model of a "risky bank". The bank faces excess demand in the loan market, can sort loan applicants by an observable measure of quality, and faces a small but positive probability of default on its loan portfolio. The bank uses two policies to allocate credit: - Tighten restrictions on loan quality - Limit the number of loans of a given quality We show that the level of default risk and other structural conditions have important e®ects on the market for loanable funds and the bank's optimal policies (loan rates, deposit rates, and lending standards). The structural conditions that we examine are monitoring costs, returns on alternative investments, firms' minimum funding requirements, and the level of the reserve requirement. The model provides insight into several stylized facts observed in loan markets, especially in developing countries.Facultad de Ciencias Económica

Structural Economic Model for Ecuador: a Dollar-ized and Oil-ized Economy

The paper develops a Structural Model with the main macroeconomic features of the Ecuadorian economy. It models the main transmission channels of a small open and dollarized economy, highly dependent on oil production and foreign remittances. It is estimated by Bayesian methods for the period 2001-2010. The framework highlights the main risks affecting the macroeconomic performance, including the importance of international shocks. It also underscores the importance of the fiscal policies and the independent and significant role of the oil value added in the domestic economy

Structural Economic Model for Ecuador: a Dollar-ized and Oil-ized Economy

The paper develops a Structural Model with the main macroeconomic features of the Ecuadorian economy. It models the main transmission channels of a small open and dollarized economy, highly dependent on oil production and foreign remittances. It is estimated by Bayesian methods for the period 2001-2010. The framework highlights the main risks affecting the macroeconomic performance, including the importance of international shocks. It also underscores the importance of the fiscal policies and the independent and significant role of the oil value added in the domestic economy

Structural Economic Model for Ecuador: a Dollar-ized and Oil-ized

El trabajo desarrolla un Modelo Estructural con las principales características macroeconómicas de la economía ecuatoriana. Modela los principales canales de transmisión de una economía pequeña, abierta y dolarizada, altamente dependiente de la producción de petróleo y las remesas del exterior. Se estima por métodos bayesianos para el período 2001-2010. El modelo permite analizar los principales riesgos que afectan el desempeño macroeconómico, incluyendo los shocks externos. También se subraya el efecto de la política fiscal así como el papel independiente y significativo del valor agregado petrolero en la economía doméstica.The paper develops a Structural Model with the main macroeconomic features of the Ecuadorian economy. It models the main transmission channels of a small open and dollarized economy, highly dependent on oil production and foreign remittances. It is estimated by Bayesian methodsfor the period 2001- 2010. The framework highlights the main risks affecting the macroeconomic performance, including the importance of international shocks. It also underscores the importance of the fiscal policies and the independent and significant role of the oil value added in the domestic economy.Facultad de Ciencias Económica

Network structure and fragmentation of the Argentinean interbank markets

This paper studies the network structure and fragmentation of the Argentinean interbank market. The unsecured (CALL) and secured (REPO) markets are examined, applying complex network analysis. Results indicate that although the secured market has fewer participants, its nodes are more densely connected than the ones in the unsecured market. The interrelationships in the unsecured market are less stable, making its structure more volatile and vulnerable to negative shocks. The analysis identifies two hidden underlying subnetworks within the REPO market: one based on the transactions collateralized by Treasury bonds (REPO-T) and the other based on the operations collateralized by Central Bank (CB) securities (REPO-CB). The changes in monetary policy stance and monetary conditions seem to have a substantially smaller effect in the former submarket than in the latter one. The connectivity levels within the REPO-T market and its structure remain relatively unaffected by the (occasionally pronounced) swings in the other market segment. Hence, the REPO market shows signs of fragmentation in its inner structure, according to the type of collateral asset involved in the transactions, so the average REPO interest rate reflects the interplay between these two partially fragmented submarkets. The REPO market´s mixed structure entails one of the main sources of differentiation with respect to the CALL market.Fil: Elosegui, Pedro Luis. Banco Central de la República Argentina; ArgentinaFil: Forte, Federico. Universidad de Buenos Aires. Facultad de Ciencias Económicas. Departamento de Economía; Argentina. Banco BBVA Argentina; ArgentinaFil: Montes Rojas, Gabriel Victorio. Consejo Nacional de Investigaciones Científicas y Técnicas. Oficina de Coordinación Administrativa Saavedra 15. Instituto Interdisciplinario de Economía Política de Buenos Aires. Universidad de Buenos Aires. Facultad de Ciencias Económicas. Instituto Interdisciplinario de Economía Política de Buenos Aires; Argentin

Risky Banking: Optimal Loan Quantity and Portfolio Quality Choices

In this paper we construct a model of a "risky bank". The bank faces excess demand in the loan market, can sort loan applicants by an observable measure of quality, and faces a small but positive probability of default on its loan portfolio. The bank uses two policies to allocate credit: - Tighten restrictions on loan quality - Limit the number of loans of a given quality We show that the level of default risk and other structural conditions have important e®ects on the market for loanable funds and the bank's optimal policies (loan rates, deposit rates, and lending standards). The structural conditions that we examine are monitoring costs, returns on alternative investments, firms' minimum funding requirements, and the level of the reserve requirement. The model provides insight into several stylized facts observed in loan markets, especially in developing countries.Facultad de Ciencias Económica

Regional and state heterogeneity of monetary shocks in Argentina

This paper empirically investigates how economic activity in Argentina at regional and provincial (i.e., state) levels responds to central national monetary policy shocks, as given by a change in the interest rate. Regional heterogeneity of monetary shocks exists in Argentina. At the regional level the long-term effects of increasing the interest rate are negative and statistically significant. At the provincial level, 11 provinces show a negative and significant impact of a shock on the interest rate over employment. However, there are 13 provinces in which the effect is not statistically significant, including the City of Buenos Aires and Buenos Aires Province. Bayesian methods are implemented to study the discrepancies in the impact on different provinces.Fil: Blanco, Emilio. Banco Central de la República Argentina; ArgentinaFil: Elosegui, Pedro Luis. Banco Central de la República Argentina; Argentina. Universidad Nacional de La Plata; Argentina. University of Illinois. Urbana - Champaign; Estados UnidosFil: Izaguirre, Alejandro. Universidad de San Andrés; ArgentinaFil: Montes Rojas, Gabriel Victorio. Universidad Nacional de La Plata; Argentina. Consejo Nacional de Investigaciones Científicas y Técnicas; Argentin

Regional and state heterogeneity of monetary shocks in Argentina

This paper empirically investigates how economic activity in Argentina at regional and provincial (i.e., state) levels responds to central national monetary policy shocks, as given by a change in the interest rate. Regional heterogeneity of monetary shocks exists in Argentina. At the regional level the long-term effects of increasing the interest rate are negative and statistically significant. At the provincial level, 11 provinces show a negative and significant impact of a shock on the interest rate over employment. However, there are 13 provinces in which the effect is not statistically significant, including the City of Buenos Aires and Buenos Aires Province. Bayesian methods are implemented to study the discrepancies in the impact on different provinces.Facultad de Ciencias Económica