Volatility of Short-term Capital Flows and Private Investment in Emerging Markets
Using micro-level panel data, the paper analyses the impacts of short-term capital flow volatility on new fixed investment spending of publicly traded real sector firms in three major emerging markets - Argentina, Mexico and Turkey. The empirical results, including sensitivity tests, suggest that increasing volatility of capital inflows has an economically and statistically significant negative effect on new investment spending of private firms. Accordingly, a 10 per cent increase in capital flow volatility reduces fixed investment spending in the range of 1-1.7, 2.3-15, and 1 per cent in Argentina, Mexico and Turkey respectively.
Volume (Year): 45 (2009)
Issue (Month): 5 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/FJDS20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/FJDS20|
When requesting a correction, please mention this item's handle: RePEc:taf:jdevst:v:45:y:2009:i:5:p:672-692. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If references are entirely missing, you can add them using this form.