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The financial crisis and the geography of wealth transfers

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  • Gourinchas, Pierre-Olivier
  • Rey, Hélène
  • Truempler, Kai

Abstract

This paper studies the geography of wealth transfers between 2007Q4 and 2008Q4, at the height of the global financial crisis. We construct valuation changes on bilateral external positions in equity, direct investment and portfolio debt to measure who benefited and who lost on their external exposure. We find a very diverse set of fortunes governed by the structure of countries' external portfolios. In particular, we are able to relate the gains and losses on debt portfolios to the country's exposure to ABS, ABCP conduits and the extent of dollar shortage.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of International Economics.

Volume (Year): 88 (2012)
Issue (Month): 2 ()
Pages: 266-283

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Handle: RePEc:eee:inecon:v:88:y:2012:i:2:p:266-283

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Web page: http://www.elsevier.com/locate/inca/505552

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Keywords: Valuation effects; Risk sharing; International financial system;

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Citations

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Cited by:
  1. Prasad, Eswar, 2011. "Role Reversal in Global Finance," IZA Discussion Papers 6032, Institute for the Study of Labor (IZA).
  2. Carlos Hurtado, 2012. "The Euro Experience: A Review of the Euro Crisis, Policy Issues, Issues Going Forward and Policy Implications for Latin America," Research Department Publications 4786, Inter-American Development Bank, Research Department.
  3. Philip R. Lane, 2012. "Financial Globalisation and the Crisis," BIS Working Papers 397, Bank for International Settlements.
  4. Carol C. Bertaut & Fang Cai & Nyssa Kim, 2013. ""Fool Me Once . . . " Did U.S. investors play it safer in the European debt crisis?," International Finance Discussion Papers 1088, Board of Governors of the Federal Reserve System (U.S.).
  5. Tommaso Trani, 2012. "Funding under Borrowing Limits in International Portfolios," IHEID Working Papers 01-2012, Economics Section, The Graduate Institute of International Studies, revised 14 Feb 2012.
  6. Natalya Martynova & Lev Ratnovski & Razvan Vlahu, 2014. "Franchise value and risk-taking in modern banks," DNB Working Papers 430, Netherlands Central Bank, Research Department.
  7. de la Torre, Augusto & Didier, Tatiana & Pinat, Magali, 2014. "Can Latin America tap the globalization upside ?," Policy Research Working Paper Series 6837, The World Bank.
  8. Minoiu, Camelia & Reyes, Javier A., 2013. "A network analysis of global banking: 1978–2010," Journal of Financial Stability, Elsevier, vol. 9(2), pages 168-184.

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