Business and Management Research News
Last month, Dr. Maria-Teresa Punzi took part in the 3rd Vietnam Symposium in Banking and Finance (VSBF) in Hue city, Vietnam. In addition to her role as a speaker, she also served as a session chair and discussant.
Webster: Tell us a little bit about the session you chaired at the conference.
Dr. Punzi: I chaired a special session on macro-financial linkages. In that session, academics from the University of Rennes 1 (France), IPAG Business School (France), Australian Catholic University (Australia), Beijing Normal University (China), Boston University (United States) and Hue University (Vietnam) presented their research projects on topics related to macro-financial linkages.
I served as the discussant for a paper by Professor Yougui Wang from Beijing Normal University on “Alternative Decomposition of Aggregate Demand: What Underlies the Secular Stagnation?” Dr. Wang’s paper offers a large overview of stock-flow consistency models, which I believe will become much more prevalent in the future for explaining economic fluctuations. I gave my comments to the authors, who hopefully found my insights constructive.
Webster: You also served as a speaker at the conference. Could you tell us about the paper that you presented?
Dr. Punzi: I presented my research paper on “The Impact of Uncertainty on the Macro-Financial Linkage with International Financial Exposure.” This paper develops a two-country dynamic stochastic general equilibrium (DSGE) model to show how different uncertainty indexes can negatively affect the business and financial cycle where banks can borrow in their home country and also abroad. International financial exposure is included in the model by allowing domestic banks to buy foreign assets in a second market.
Saliently, this paper shows that macro-prudential policies are very effective in leaning against the credit cycle when monetary policy shocks hit the economy, but they become ineffective when the economic agents fear increasing monetary policy uncertainty, i.e. they expect an increase in the future interest rate. This is an important message for policy makers when setting macro-prudential policy. It is very important to understand the nature of shocks.
Webster: What were your takeaways from the conference, Dr. Punzi?
Dr. Punzi: I really enjoyed the conference. There were speakers from Asia, Australia, Japan, Europe and the United States. I feel I have learned so much, shared my knowledge with many international professors, and gained many insights which will improve my current research. Most importantly, I have developed new ideas for future research. It was a long trip but totally worth it.