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The Financial Crisis and The Geography of Wealth Transfers

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  • Pierre-Olivier Gourinchas
  • Hélène Rey
  • Kai Truempler

Abstract

This paper studies the geography of wealth transfers during the 2008 global financial crisis. We construct valuation changes on bilateral external positions in equity, direct investment and portfolio debt at the height of the crisis to map 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 ABCP conduits and the extent of dollar shortage.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 17353.

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Date of creation: Aug 2011
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Publication status: published as Gourinchas, Pierre-Olivier & Rey, Hélène & Truempler, Kai, 2012. "The financial crisis and the geography of wealth transfers," Journal of International Economics, Elsevier, vol. 88(2), pages 266-283.
Handle: RePEc:nbr:nberwo:17353

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Citations

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Cited by:
  1. Natalya Martynova & Lev Ratnovski & Razvan Vlahu, 2014. "Franchise value and risk-taking in modern banks," DNB Working Papers, Netherlands Central Bank, Research Department 430, Netherlands Central Bank, Research Department.
  2. 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.
  3. Philip Lane, 2013. "Financial Globalisation and the Crisis," Open Economies Review, Springer, vol. 24(3), pages 555-580, July.
  4. 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.
  5. 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, Board of Governors of the Federal Reserve System (U.S.) 1088, Board of Governors of the Federal Reserve System (U.S.).
  6. Eswar S. Prasad, 2011. "Role Reversal in Global Finance," NBER Working Papers 17497, National Bureau of Economic Research, Inc.
  7. 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.
  8. 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.

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