Crisis , contagion and international policy spillovers under foreign ownership of banks ∗


This paper checks how international spillovers of shocks and polices are modified when banks are foreign owned. We build a two-country DSGE model with banking sectors that are owned by residents of one (big and foreign) country. Consistently with empirical findings we find that foreign ownership of banks amplifies spillovers from foreign shocks. Moreover… (More)


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