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On the determinants of capital flight from Russia

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  • Marcella Mulino

Abstract

The paper addresses the problem of defining and assessing the scale of capital flight from Russia and of briefly reviewing the channels through which capital, both of legal and illegal origin, illegally leaves Russia. It then highlights the determinants of Russian capital flight, as the traditional view of a reaction to divergences among real domestic and foreign returns and to economic and political risks proves inadequate. More important factors are linked to specific features of the transition process under way, that is macroeconomic instability and variability of government policies, weak protection of property rights and savings, a fragile banking system limiting access to investment finance, high and unevenly enforced taxes, a large share of unofficial activities, and considerable levels of corruption. Copyright International Atlantic Economic Society 2002

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  • Marcella Mulino, 2002. "On the determinants of capital flight from Russia," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 30(2), pages 148-169, June.
    • Handle: RePEc:kap:atlecj:v:30:y:2002:i:2:p:148-169
    DOI: 10.1007/BF02299159
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    References listed on IDEAS

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    2. Chin-Hong Puah & Albert Apoi & Jerome Swee-Hui Kueh, 2008. "Outward FDI of Malaysia: An Empirical Examination from Macroeconomic Perspective," Economics Bulletin, AccessEcon, vol. 6(28), pages 1-11.
    3. Afees A. Salisu & Kazeem Isah, 2017. "A Capital Flight-Growth Nexus in Sub-Saharan Africa: The Role of Macroeconomic Uncertainty," Working Papers 034, Centre for Econometric and Allied Research, University of Ibadan.
    4. Svetlana Ledyaeva & Päivi Karhunen & John Whalley, 2013. "If Foreign Investment Is not Foreign: Round-Trip Versus Genuine Foreign Investment in Russia," Working Papers 2013-05, CEPII research center.
    5. Brada, Josef C. & Kutan, Ali M. & Vukšić, Goran, 2013. "Capital Flight in the Presence of Domestic Borrowing: Evidence from Eastern European Economies," World Development, Elsevier, vol. 51(C), pages 32-46.

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