Search results for "International capital"
showing 4 items of 4 documents
Will Basel II Affect International Capital Flows To Emerging Markets?
2004
This paper investigates the consequences of Basel II for international capital flows to emerging markets. The paper shows that the magnitude of effects critically depends on a number of assumptions, including: the mapping of risk weights to ratings, assumptions about required return on capital, assumptions about competition and diversion effects and the assumption that minimum capital requirements are binding constraints. The paper provides evidence on each of these assumptions and estimates their effect on interest margins and bank flows.Overall the results suggest that Basel II - taking into account the "Potential Modifications" of November 2001 - will have only a moderate impact on inter…
Patterns of international capital flows and their implications for developing countries
2017
According to standard economic theory, capital should flow from rich to poor countries. However, a reverse pattern has prevailed in the world economy. This is the so-called Lucas paradox. In addition, it has been shown that, counterintuitively, there is a negative correlation between capital inflow and productivity growth across developing countries. This is the so-called allocation puzzle. This review sheds light on the following questions: “What are the patterns of international capital flows in the world economy?”, “What are the most plausible explanations for these patterns?”, and “What are the possible implications of these developments for developing countries?” In addition, the curre…
The Legacy and the Tyranny of Time: Exit and Re-Entry of Sovereigns to International Capital Markets
2018
We use a novel continuous-time Weibull model (without and) with a change-point in the duration dependence parameter to investigate the duration of the exit and re-entry of sovereigns to international capital markets. Relying on annual data for a large panel of countries over the period 1970-2011, we find that, as the reputation of debtor countries as good (bad) borrowers solidifies over time, those episodes are more likely to end - i.e. the "legacy of time". Debtor countries can take advantage of the "benefit of doubt" of creditors during short exit spells. However, when exits are long and the reputation as a bad borrower emerges, no more "complacency" makes it more difficult for them to bo…
Uncertainty and cross-border banking flows
2019
Abstract While global uncertainty—measured by the VIX—has proven to be a robust global “push” factor of international capital flows, there has been no systematic study assessing the role of uncertainty in driving bilateral capital flows. This paper examines the effects of higher country-specific uncertainty on cross-border banking flows using data from the Bank for International Settlements Locational Banking Statistics. The bilateral structure of this data allows disentangling supply factors from demand factors, thereby helping identify the effect of higher uncertainty on cross-border banking flows from other confounding factors. The results of this analysis suggest that: (i) uncertainty i…