Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies

This paper introduces a new global database and a policy classification framework that records the financial sector policy response to the COVID-19 pandemic across 155 jurisdictions and over time. It documents that authorities around the world have taken a diverse array of measures to mitigate finan...

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Main Authors:	Feyen, Erik, Alonso Gispert, Tatiana, Kliatskova, Tatsiana, Mare, Davide S.
Format:	Journal Article
Published:	Elsevier 2021
Subjects:	FINANCIAL REGULATION FINANCIAL STABILITY CORONAVIRUS COVID-19 PANDEMIC IMPACT PANDEMIC RESPONSE EMERGING MARKET ECONOMIES DEBT SERVICE BURDEN MONETARY UNION BANKING SECTOR PUBLIC POLICY GOVERNMENT POLICY
Online Access:	http://hdl.handle.net/10986/36019

id	okr-10986-36019
recordtype	oai_dc
spelling	okr-10986-360192022-01-28T16:02:32Z Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies Feyen, Erik Alonso Gispert, Tatiana Kliatskova, Tatsiana Mare, Davide S. FINANCIAL REGULATION FINANCIAL STABILITY CORONAVIRUS COVID-19 PANDEMIC IMPACT PANDEMIC RESPONSE EMERGING MARKET ECONOMIES DEBT SERVICE BURDEN MONETARY UNION BANKING SECTOR PUBLIC POLICY GOVERNMENT POLICY This paper introduces a new global database and a policy classification framework that records the financial sector policy response to the COVID-19 pandemic across 155 jurisdictions and over time. It documents that authorities around the world have taken a diverse array of measures to mitigate financial distress in the markets and for borrowers, and to support the provision of critical financial services to the real economy. Using Cox proportional hazards and Poisson regressions, the paper takes initial steps to analyze the determinants of policy makers’ responsiveness and activity in emerging markets and developing economies, respectively. The results indicate that policy makers in richer and more populous countries have been significantly more responsive and have taken more policy measures. Belonging to a monetary union is also significantly associated with a faster and more frequent intervention. Countries with higher private debt levels tend to respond earlier with banking sector and liquidity and funding measures. The spread of COVID-19, macro-financial fundamentals, pressure on foreign exchange markets, political settings, and fiscal and containment policies appear to play a limited role in determining policy response. In a substantially smaller sample, the paper explores the role of banking sector characteristics and finds that emerging markets and developing economies with higher private bank credit to GDP and that have adopted Basel III reforms have taken fewer policy measures. 2021-07-26T14:39:37Z 2021-07-26T14:39:37Z 2021-05-21 Journal Article Journal of Banking and Finance http://hdl.handle.net/10986/36019 CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Elsevier Publications & Research Publications & Research :: Journal Article
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
topic	FINANCIAL REGULATION FINANCIAL STABILITY CORONAVIRUS COVID-19 PANDEMIC IMPACT PANDEMIC RESPONSE EMERGING MARKET ECONOMIES DEBT SERVICE BURDEN MONETARY UNION BANKING SECTOR PUBLIC POLICY GOVERNMENT POLICY
spellingShingle	FINANCIAL REGULATION FINANCIAL STABILITY CORONAVIRUS COVID-19 PANDEMIC IMPACT PANDEMIC RESPONSE EMERGING MARKET ECONOMIES DEBT SERVICE BURDEN MONETARY UNION BANKING SECTOR PUBLIC POLICY GOVERNMENT POLICY Feyen, Erik Alonso Gispert, Tatiana Kliatskova, Tatsiana Mare, Davide S. Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies
description	This paper introduces a new global database and a policy classification framework that records the financial sector policy response to the COVID-19 pandemic across 155 jurisdictions and over time. It documents that authorities around the world have taken a diverse array of measures to mitigate financial distress in the markets and for borrowers, and to support the provision of critical financial services to the real economy. Using Cox proportional hazards and Poisson regressions, the paper takes initial steps to analyze the determinants of policy makers’ responsiveness and activity in emerging markets and developing economies, respectively. The results indicate that policy makers in richer and more populous countries have been significantly more responsive and have taken more policy measures. Belonging to a monetary union is also significantly associated with a faster and more frequent intervention. Countries with higher private debt levels tend to respond earlier with banking sector and liquidity and funding measures. The spread of COVID-19, macro-financial fundamentals, pressure on foreign exchange markets, political settings, and fiscal and containment policies appear to play a limited role in determining policy response. In a substantially smaller sample, the paper explores the role of banking sector characteristics and finds that emerging markets and developing economies with higher private bank credit to GDP and that have adopted Basel III reforms have taken fewer policy measures.
format	Journal Article
author	Feyen, Erik Alonso Gispert, Tatiana Kliatskova, Tatsiana Mare, Davide S.
author_facet	Feyen, Erik Alonso Gispert, Tatiana Kliatskova, Tatsiana Mare, Davide S.
author_sort	Feyen, Erik
title	Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies
title_short	Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies
title_full	Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies
title_fullStr	Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies
title_full_unstemmed	Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies
title_sort	financial sector policy response to covid-19 in emerging markets and developing economies
publisher	Elsevier
publishDate	2021
url	http://hdl.handle.net/10986/36019
_version_	1764484259899244544

Financial Sector Policy Response to COVID-19 in Emerging Markets and Developing Economies

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