Title: The Spill-back and Spillover Effects of US Monetary Policy: Evidence on an International Cost Channel

Speaker: Lu Lingfei, PhD Candidate in Economics, Business School, Hong Kong University of Science and Technology; visited the Business School of Columbia University during his PhD studies, supervised by Professor Shang-Jin Wei and recommended by him. His research fields include international trade, international finance, open macroeconomics, and China's economic development. His core research topics include exchange rate risk, trade networks, import-export linkage, supply chains, trade credit, and monetary policy.

His research results are presented in the form of multiple English papers and have been displayed at top domestic and foreign academic conferences: among them, the paper on credit constraints of importing enterprises and exchange rate pass-through has been published in Journal of Economic Behavior & Organization (JEBO); the paper on the spillback-spillover effects of Federal Reserve monetary policy and the international cost channel has received a revise-and-resubmit notice from Journal of International Money and Finance (JME).

Abstract: Based on disaggregated trade data, this study empirically finds:

    Spillback effect: Unexpectedly tight US monetary policy will push up US import prices, which is different from the prediction of traditional open macro models;

    Spillover effect: Unexpectedly tight US monetary policy will also push up import prices of other countries, which is a new empirical phenomenon that has not been fully concerned before.

To analyze the mechanism, the study takes Chinese exporters as samples and identifies the "borrowing cost channel": after US monetary tightening, the liquidity situation of Chinese exporters generally deteriorates; and enterprises facing higher borrowing costs and tighter liquidity constraints have a larger response in their product prices—this result verifies the role of the international cost channel in the cross-border transmission of monetary policy.

Date & time: 09 December 2025, 14:00

Venue: B321, Zhixin Building, Central Campus, Shandong University