Is the Fed Hindering Development? Impacts of US interest rates on growth, income distribution and macroeconomic policy space in developing countries: a demand-led growth model
Date
2023
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
University of the Witwatersrand, Johannesburg
Abstract
The US Fed has responded to recent inflation pressures with the most rapid interest rate hike since the 1979-82 Volcker’s disinflation. The hike in the beginning of the 1980s was followed by harsh external crises in the developing world, especially in Latin America. The current situation adds tot that the role the US monetary policy plays on quickly shifting massive capital flows in a world of open and volatile capital accounts (Rey, 2015). On the other hand, interest rate levels remain low on historical levels and developing countries come from decades of relative growth and record international reserve accumulation. Following the recent development in external policy space debates, this thesis aims to understand how a deterioration of external conditions, especially through higher foreign interest rates, may impact growth, income distribution, and macroeconomic policy space in developing countries.
Description
A research report submitted in partial fulfillment of the Degree of Master of Commerce (Applied Development Economics) in the School of Economics and Finance, University of the Witwatersrand, Johannesburg 2023
Keywords
Demand-led growth, Macroeconomic policy, Development, Income distribution, Open economy, UCTD
Citation
Vaz, João Emboava. (2023). Is the Fed Hindering Development? Impacts of US interest rates on growth, income distribution and macroeconomic policy space in developing countries: a demand-led growth model [Master’s dissertation, University of the Witwatersrand, Johannesburg].WireDSpace.https://hdl.handle.net/10539/43545