01959cas a2200241 a 4500 AALejournalIMF006332 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451963847 1018-5941 BD-DhAAL BD-DhAAL Sosa, Sebastian. The Influence of 'Big Brothers : ' How Important are Regional Factors for Uruguay? / Sebastian Sosa. Washington, D.C. : International Monetary Fund, 2010. 1 online resource (26 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper examines the role played by regional factors in Uruguay, identifies the sources and transmission mechanisms of shocks stemming from the region, and assesses how vulnerable Uruguay is to a potential crisis in the region. Using a VAR model with block exogeneity restrictions, it finds that shocks from Argentina-which account for about 20 percent of Uruguayan output fluctuations-have large and rapid effects. This is mainly due to the existence of idiosyncratic real and financial linkages between Uruguay and Argentina, which also explain the very high correlation between their business cycles. The analysis of previous crises in the region suggests that despite the importance of these strong linkages, and despite the fact the two deepest crises in recent Uruguayan history followed crises in Argentina, Uruguay is now clearly less vulnerable to financial contagion from the region. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2010/060 Full text available on IMF http://elibrary.imf.org/view/journals/001/2010/060/001.2010.issue-060-en.xml IMF e-Library