Ripples into Waves: Trade Networks, Economic Activity, and Asset Prices
活動時間🦹🏽♂️👩🏼🎓：9月4日10:30 – 11:30
活動地點：Virtual Meeting through XYLink（小魚易連）
活動演講人： Huancheng DU
活動內容
Topic
Speaker
Huancheng DU
Postdoc, Princeton University
Abstract
We exploit information in sovereign CDS prices and the international trade network to reveal novel facts about the propagation of global macroeconomic shocks. We show that trade links are an important source of shock transmission using identification through heteroskedasticity, credit/equity return predictability, and a natural experiment. News about country fundamentals flows primarily from importers to exporters, depends on both direct and indirect links in the trade network, and is magnified by the exporting country’s financial vulnerability. We provide the first macroeconomic confirmation of the importance of the trade network to shock propagation in global markets that uses forward-looking financial variables.