nep-cis New Economics Papers
on Confederation of Independent States
Issue of 2011‒12‒19
one paper chosen by
Koen Schoors
Ghent University

  1. Low-Income Countries' BRIC Linkage: Are There Growth Spillovers? By Yongzheng Yang; Issouf Samaké

  1. By: Yongzheng Yang; Issouf Samaké
    Abstract: Trade and financial ties between low-income countries (LICs) and Brazil, Russia, India, and China (BRICs) have expanded rapidly in recent years. This gives rise to the potential for growth to spill over from the latter to the former. We employ a global vector autoregression (GVAR) model to investigate the extent of business cycle transmission from BRICs to LICs through both direct (FDI, trade, productivity, exchange rates) and indirect (global commodity prices, demand, and interest rates) channels. The estimation results show that there are significant direct spillovers while indirect spillovers also matters in many cases. Based on these results, we show that growing LIC-BRIC ties have significantly helped alleviate the adverse impact of the recent global financial crisis on LIC economies.
    Keywords: Brazil , Business cycles , China , Economic growth , Economic models , India , Low-income developing countries , Russian Federation , Spillovers ,
    Date: 2011–11–16

This nep-cis issue is ©2011 by Koen Schoors. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.