## Spillovers to Low-Income Countries: Importance of Systemic Emerging Markets

_IMF Working Papers, February 1, 2012_

## Source details

**Canonical URL:** [Spillovers to Low-Income Countries: Importance of Systemic Emerging Markets](https://www.imf.org/en/publications/wp/issues/2016/12/31/spillovers-to-low-income-countries-importance-of-systemic-emerging-markets-25729)

## Other formats

- [Markdown version](/en/publications/wp/issues/2016/12/31/spillovers-to-low-income-countries-importance-of-systemic-emerging-markets-25729/index.md)
- [Structured JSON version](/en/publications/wp/issues/2016/12/31/spillovers-to-low-income-countries-importance-of-systemic-emerging-markets-25729/index.json)
- [Bundle manifest](/en/publications/wp/issues/2016/12/31/spillovers-to-low-income-countries-importance-of-systemic-emerging-markets-25729/bundle-manifest.json)

## Bibliographic details
- Authors: Era Dabla-Norris, Raphael A Espinoza, Sarwat Jahan
- Published: February 1, 2012
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781463937102.001

---

### Summary and research objectives
- Documents expanding economic linkages between low-income countries (LICs) and a narrow group of "Emerging Market leaders" that have become major players in regional and global trade and financial flows.
- Aims to quantify how foreign shocks transmit to LIC growth and to identify the channels and heterogeneity across regions and production structures.

### Methodology
- Uses Vector Autoregression (VAR) models to assess how linkages have changed the share of growth volatility in LICs attributable to foreign shocks.
- Employs dynamic panel models to analyze the impact of LIC trade orientation and production structure on sensitivity to foreign shocks.

### Key empirical findings
- VAR results: Linkages with Emerging Market leaders have increased the share of growth volatility in LICs that can be attributed to foreign shocks.
- Dynamic panel results:
  - The elasticity of LIC growth to trading partners' growth is high for LICs in:
    - Asia
    - Latin America and the Caribbean
    - Europe and Central Asia
  - For commodity-exporting LICs in:
    - Sub-Saharan Africa
    - Middle East and North Africa (MNA region)
    - The main channels of transmission of foreign shocks are terms of trade shocks and demand from the emerging market leaders.

### Data and publication metadata
- Authors: Era Dabla-Norris, Raphael A Espinoza, Sarwat Jahan
- Date: February 1, 2012
- Series: IMF Working Paper No. 2012/049
- Issue: 049
- Volume: 2012
- Pages: 27
- DOI: https://doi.org/10.5089/9781463937102.001
- Stock No: WPIEA2012049
- ISBN: 9781463937102
- ISSN: 1018-5941

*Source: IMF Working Paper "Spillovers to Low-Income Countries: Importance of Systemic Emerging Markets" (2012/049), Era Dabla-Norris, Raphael A Espinoza, Sarwat Jahan.*

---

## Content in this bundle

- **Wp1249**
  - [Wp1249 (Markdown version)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2012/_wp1249.pdf.md){rel="alternate" type="text/markdown"}
  - [Wp1249 (PDF)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2012/_wp1249.pdf){rel="external" type="application/pdf"}

---

_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/spillovers-to-low-income-countries-importance-of-systemic-emerging-markets-25729_