Macrofinancial Linkages and Growth at Risk in the Dominican Republic
IMF Working Papers, November 13, 2019
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Bibliographic details
- Authors: Olga Bespalova, Marina V Rousset
- Published: November 13, 2019
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781513519203.001
Methodology and data
- Uses the Growth-at-Risk (GaR) methodology to examine how macrofinancial conditions affect the growth outlook and its probability distribution.
- Evaluates risks to GDP growth in the Dominican Republic using quarterly data for 1996-2018.
- Groups macrofinancial conditions into five principal determinants, based on 32 indicators.
Key findings
- The Dominican Republic’s growth distribution appears most vulnerable to negative shocks to:
- domestic financial conditions
- domestic leverage
- domestic demand
- external demand
- There are additional repercussions from the external cost of borrowing in the longer run.
- Domestic monetary policy plays a particularly important role in reducing growth vulnerabilities when the economy is weak.
Policy implications and transmission
- Emphasizes the role of domestic monetary policy in mitigating downside growth risks, especially under weak economic conditions.
- Highlights channels where macrofinancial conditions (financial conditions, leverage, demand, external borrowing costs) transmit to GDP growth risk.
Publication and metadata
- Title: Macrofinancial Linkages and Growth at Risk in the Dominican Republic
- Authors: Olga Bespalova, Marina V Rousset
- Date: November 13, 2019
- Series: Working Paper No. 2019/246
- Issue: 246
- Volume: 2019
- Pages: 19
- ISBN: 9781513519203
- ISSN: 1018-5941
- Stock No: WPIEA2019246
- DOI: https://doi.org/10.5089/9781513519203.001
IMF Working Paper — Macrofinancial Linkages and Growth at Risk in the Dominican Republic (Olga Bespalova, Marina V Rousset, November 13, 2019).
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