The development of Latin American emerging market and international activities of U.S.

Research Project

Project/Area Number	09630096
Research Category	Grant-in-Aid for Scientific Research (C)
Allocation Type	Single-year Grants
Section	一般
Research Field	Public finance/Monetary economics
Research Institution	KYUSHU UNIVERSITY
Principal Investigator	KAWANAMI Yoichi Kyushu Univ., Fac.of Economics, Professor, 経済学部, 教授 (80150390)
Project Period (FY)	1997 – 1998
Project Status	Completed (Fiscal Year 1998)
Budget Amount *help	¥2,200,000 (Direct Cost: ¥2,200,000) Fiscal Year 1998: ¥600,000 (Direct Cost: ¥600,000) Fiscal Year 1997: ¥1,600,000 (Direct Cost: ¥1,600,000)
Keywords	emerging market / investment bank / overproduction / 国際資本移動 / 金融システム / 国際金融市場 / 新興市場 / 商業銀行
Research Abstract	In this research, I have examined that the role of international institutional investors and investment banks were getting bigger and bigger due to globalization in the world financial markets as well as financial crisis of emerging market. economies. A new phenomenon in international financial market. which is financial and economic crisis in the emerging market economies has appeared during the term of this project I had to examine also the background and cause of this phenomenon, and finally had obtained the following research result. The U.S.budget deficit has begun to reduce gradually since S&L crisis during 1989-9 1. In addition, the U.S interest rates such as TB rate has declined due to the effect of restructuring : during 1980's. Domestic investment revived including the field of information technology. The profitability of U.S.corporations and individuals income has improved, and this factor can explain the upward movement of U.S.stock prices. The discrepancy of interest rates between U.S.and other countries still remained during 1990's Therefore, world financial intermediation through the U.S.has also remained. The U S financial institutions invested money-capital raised from world financial market at high rate into high risk and high return market like emerging market economies. Eventually capital flow into emerging economies has grew drastically and over-investment and over-production in the sector of automobile , IC.and steel industries area has been generated. Profits of corporations of emerging economies has declined, and they had to rely upon speculative financial transaction to revive their profits. Such kind of behavior has generated a financial bubble and financial crisis in the emerging market economies.