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Econometrics of the Real Effects of Cross-Border Capital Flows in Emerging Markets

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  • J Benson Durham

Abstract

This study examines the effects of cross-border flows - FDI, FPI, and FBL - on growth and savings rates using data on 56 countries from 1969 through 1998. Very generally, few flow measures are significant determinants of real variables. However, consideration of the initial level of financial depth - including measures of private credit, bank lending, and stock market development - seems to produce more significant results, as some data indicate that flows have a more deleterious (benevolent) effect in countries with lower (higher) levels of development. Moreover, extreme bound analysis (EBA) of significant results indicates that these findings are robust.

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Paper provided by Queen Elizabeth House, University of Oxford in its series QEH Working Papers with number qehwps52.

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Handle: RePEc:qeh:qehwps:qehwps52

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Cited by:
  1. Hakan Berument & N. Nergiz Dincer, 2004. "Do Capital Flows Improve Macroeconomic Performance in Emerging Markets? : The Turkish Experience," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 40(4), pages 20-32, July.
  2. J Benson Durham, . "Time-Series Econometrics of the Real and Financial Effects of Capital Flows: Selected Cases in Africa and Southern Asia," QEH Working Papers qehwps56, Queen Elizabeth House, University of Oxford.

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