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The increasingly closer economic relations among Mainland China, Hong Kong, Macao and Taiwan have emerged and expanded the need for monetary cooperation. The pursuit of monetary cooperation could not only have a long-term strategic significance for the internationalising progress of RMB, but also a practical significance in boosting the mutually beneficial development of regional economy, as well as reducing financial risks and the political divergences between the two sides of Taiwan Strait. In this paper, the feasibility of monetary cooperation among Mainland China, Hong Kong, Macao and Taiwan is analysed from the perspectives of static state and dynamic trend by using the three-variable SVAR model (output, price and interest rate), state-space model and impulse-response analysis. The research finds that an overall symmetry of economic shocks from these four regions is relatively symmetrical. Besides, the restructuring speed of economic shock and the dynamic trend of the symmetry of economic shock are relatively optimistic. From the perspective of economy, it is believed that, as their trade and financial cooperation deepens, the conditions for monetary cooperation among Mainland China, Hong Kong, Macao and Taiwan, would gradually mature. [ABSTRACT FROM AUTHOR]

This paper examines the effect of Economic Policy Uncertainty (EPU) on cash holding decisions of firms in BRIC countries. Our focus is on the firms in BRIC countries, a particularly interesting group of countries to consider given their increasingly important role in the world economy. By using firm-level data through the 10 years period of 2006–2015, we find that firms prefer to hold more cash when uncertainty increases after controlling for firm level variables with industry and year fixed effects. The results are robust to alternative control variables, EPU calculations and selection of sub-samples. In addition to the country specific EPU levels, global EPU also has a significant positive impact on corporate cash holdings. [ABSTRACT FROM AUTHOR]

This paper analyzes the exchange rate pass-through (ERPT) to domestic prices (consumer and producer prices), and to import prices for the G-7 countries. It is our aim to answer three key questions with strong economic policy implications: (i) is there a lower rate of ERPT in countries with an increased emphasis in monetary policy based on price stability?; (ii) is there a significant connection between ERPT and inflation volatility?; and (iii) do exchange rate regimes have a role to explain the ERPT? Our findings suggest that: (i) Taylor's hypothesis holds; (ii) there is a robust and positive significant connection between ERPT and inflation volatility; and (iii) ERPT depends on the exchange rate regimes. [ABSTRACT FROM AUTHOR]

This paper examines the coherence and usefulness of the contentious concept of ‘national competitiveness’. We undertake an interpretative review of the various uses of the concept in international economics. It is argued (á la Erik Reinert) that the concept of competitiveness is coherent in the presence of dynamic externalities, with a ‘winner picking’ exercise, by social planners, at its core. However, its usefulness for real-world policymaking can be limited because of practical problems (political and information imperfections) of picking the ‘real winners’. These problems are nonetheless not insurmountable. There is ample evidence that competitiveness strategies can work if they are the ‘right’ kind for a given political configuration. [ABSTRACT FROM AUTHOR]

This paper aims to investigate the economic risk contagion among major economies in the world by utilizing an innovative spillover analysis method accompanied with data from economic policy uncertainty (EPU) indices. To obtain more robust conclusions, the risk spillover effects are detected in both time and frequency domains. The empirical results show that, first of all, in terms of time-domain framework, the top six largest economies has strong connectedness in economic risk (uncertainty) and US seems to be both the major risk spillover contributor and receiver among these major economies. While regarding to frequency-domain analysis, most risk spillover effects are observed only in short-term frequency at 1 to 3 months. Secondly, the static net EPU spillover effects indicates that US, in average, is the key spillover transmitter and UK as well as China are the major spillover receivers. Finally, the dynamic rolling-window results confirm that with time-varying domestic and global economic situations, no country is identified as a successive net EPU spillover contributor or receiver across both time and various frequency domains. China, however, is presenting its upward economic strength and outside impacts in global economy system since about 2017. • Economic risk contagion is analyzed in both time and frequency domains. • EPU indices of six major economies are employed as proxies of economic risk. • Both static and time-varying spillover effects are calculated. • US are the major risk spillover contributor and receiver. • Economic risk spillovers are mainly observed in short-term frequency. [ABSTRACT FROM AUTHOR]

Uncertainty plays an important role in the global economy. In this paper, the economic policy uncertainty (EPU) indices of the United States and China are selected as the proxy variable corresponding to the uncertainty of national economic policy. By adopting the visibility graph algorithm, the four economic policy uncertainty indices of the United States and China are mapped into complex networks, and the topological properties of the corresponding networks are studied. The Hurst exponents of all the four indices are within 0. 5 , 1 , which implies that the economic policy uncertainty is persistent. The degree distributions of the EPU networks have power-law tails and thus the networks are scale-free. The average clustering coefficients of the four EPU networks are high and close to each other, while these networks exhibit weak assortative mixing. We also find that the EPU network in United States based on daily data shows the small-world feature since the average shortest path length increases logarithmically with the network size such that L N = 0. 626 ln N + 0. 405. Our research highlights the possibility to study the EPU from the view angle of complex networks. • We construct economic policy uncertainty networks for the US and China. • The economic policy uncertainty is persistent in different economies. • The EPU networks are scale-free, densely connected and weakly assortative. • The EPU network constructed from the daily US index exhibit evident small-world features. [ABSTRACT FROM AUTHOR]