External Capital Structures and Oil Price Volatility

This paper assesses the extent to which a countrys external capital structure can aid in mitigating the macroeconomic impact of oil price shocks. Two Caribbean economies highly vulnerable to oil price shocks are considered: an oil importer (Jamaica) and an oil exporter (Trinidad and Tobago). From a risk-sharing perspective, a desirable external capital structure is one that, through international capital gains and losses, helps offset responses of the current account balance to external shocks. It is found that both countries could alter their international portfolio to provide a better buffer against such shocks.

Bibliographic Details

Main Author:	Inter-American Development Bank
Other Authors:	John D. Burger
Format:	Working Papers biblioteca
Language:	English
Published:	Inter-American Development Bank
Subjects:	Petroleum, Coal and Natural Gas, Energy Market, Financial Market, F3 - International Finance, G1 - General Financial Markets, IDB-WP-107,
Online Access:	http://dx.doi.org/10.18235/0010740 https://publications.iadb.org/en/external-capital-structures-and-oil-price-volatility
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