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Financial Integration, Financial Deepness and Global Imbalance

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  • Enrique G. Mendoza

    (University of Maryland, IMF and NBER)

Abstract

Three empirical observations motivate our analysis: (1) financial deepness varies widely even amongst industrial countries, with the United States ranking at the top; (2) the secular decline in the U.S. net foreign asset position started in the early 1980s, together with a gradual process of international capital markets liberalization; (3) net exports and current account balances are negatively correlated with indicators of financial development.

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Bibliographic Info

Paper provided by Society for Economic Dynamics in its series 2007 Meeting Papers with number 746.

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Date of creation: 2007
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Handle: RePEc:red:sed007:746

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