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The Global Role of the U.S. Economy: Linkages, Policies and Spillovers

Author

Listed:
  • M. Ayhan Kose

    (Development Prospects Group, World Bank; Brookings Institution; CAMA; CEPR)

  • Csilla Lakatos

    (Development Prospects Group, World Bank)

  • Franziska Ohnsorge

    (Development Prospects Group, World Bank; CAMA)

  • Marc Stocker

    (Development Prospects Group, World Bank)

Abstract

This paper analyzes the role of the United States in the global economy and examines the extent of global spillovers from changes in U.S. growth, monetary and fiscal policies, and uncertainty in its financial markets and economic policies. Developments in the U.S. economy, the world’s largest, have effects far beyond its shores. A surge in U.S. growth could provide a significant boost to the global economy. Tightening U.S. financial conditions—whether due to contractionary U.S. monetary policy or other reasons— could reverberate across global financial markets, with adverse effects on some emerging market and developing economies that rely heavily on external financing. In addition, lingering uncertainty about the course of U.S. economic policy could have an appreciably negative effect on global growth prospects. While the United States plays a critical role in the world economy, activity in the rest of the world is also important for the United States.

Suggested Citation

  • M. Ayhan Kose & Csilla Lakatos & Franziska Ohnsorge & Marc Stocker, 2017. "The Global Role of the U.S. Economy: Linkages, Policies and Spillovers," Koç University-TUSIAD Economic Research Forum Working Papers 1706, Koc University-TUSIAD Economic Research Forum.
    • Handle: RePEc:koc:wpaper:1706
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    United States; uncertainty; trade; business cycles; global economy.;
    All these keywords.

    JEL classification:

    • C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General

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