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The relationship between capital flows and financial development:a review of the literature

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  • J. Ramos-Tallada.

Abstract

Paradoxically, industrialised countries tend to be net importers of capital. This phenomenon could be explained by the relatively higher level of financial development. Freedom of capital movements risks consolidating these differences in financial development between countries. However the theoretical causal links in this relationship are difficult to demonstrate empirically.

Suggested Citation

  • J. Ramos-Tallada., 2011. "The relationship between capital flows and financial development:a review of the literature," Quarterly selection of articles - Bulletin de la Banque de France, Banque de France, issue 22, pages 19-31, Summer.
  • Handle: RePEc:bfr:quarte:2011:22:02
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    References listed on IDEAS

    as
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    5. Joseph Gruber & Steven Kamin, 2009. "Do Differences in Financial Development Explain the Global Pattern of Current Account Imbalances?," Review of International Economics, Wiley Blackwell, vol. 17(4), pages 667-688, September.
    6. Pierre-Olivier Gourinchas & Olivier Jeanne, 2013. "Capital Flows to Developing Countries: The Allocation Puzzle," Review of Economic Studies, Oxford University Press, vol. 80(4), pages 1484-1515.
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    More about this item

    Keywords

    capital flows; international financial integration; financial development.;

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
    • G29 - Financial Economics - - Financial Institutions and Services - - - Other

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