%0 Journal Article
%T U.S. Monetary Policy, Emerging Market FDI Firms and Trade Credit
%A Shao Han
%J Open Journal of Business and Management
%P 667-696
%@ 2329-3292
%D 2024
%I Scientific Research Publishing
%R 10.4236/ojbm.2024.121037
%X <span style=\"font-size:10.0pt;font-family:;\" \"=\"\">This article empirically explore a trade credit
channel through which FDI firms can s<span>pread
U.S. monetary policy shocks to the host country. Based on th</span>e firm-level
data in emerging market countries provided by Osiris, This article finds that
the U.S. <span>monetary policy has a negative
impact on the trade credit supply of FDI</span> com<span>panies in emerging market countries and then affects the liquidity of
local companies in the host country due to the financing advantages of FDI
companies, and this impact is more pronounced for firms with less financing
constraints and for firms whose parent companies are located in developed</span> countries. Country heterogeneity analysis shows that the impact is greater in <span>the host countries with more open capital
accounts, less flexibility in ex</span>change rates and higher levels of
financial development. Further research shows that U.S. monetary policy
eventually has an influence on the financial situation of the local firms in
the host country by affecting the trade credit of FDI firms, and this channel
has a greater impact on local companies which have a smaller scale and sectors
that are highly dependent on external financing. Moreov<span>er, in this channel, the macro-prudential policies implemented by the
host</span><span> country are ineffective. Only
capital controls can effectively weaken the in</span>fluence, while foreign
exchange intervention will amplify this impact.</span>
%K U.S. Monetary Policy
%K FDI Firm
%K Credit Trade
%K Shadow Rate
%U http://www.scirp.org/journal/PaperInformation.aspx?PaperID=130936