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Cross-Border Investment in Small International Financial Centers

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  • Lane, Philip R.
  • Milesi-Ferretti, Gian Maria

Abstract

We document and assess the role of small financial centers in the international financial system using a newly-assembled dataset. We present estimates of the foreign asset and liability positions for a number of the most important small financial centers, and place these into context by calculating the importance of these locations in the global aggregate of cross-border investment positions. We also report data on bilateral cross-border investment patterns, highlighting which countries engage in financial trade with small financial centers.

Suggested Citation

  • Lane, Philip R. & Milesi-Ferretti, Gian Maria, 2010. "Cross-Border Investment in Small International Financial Centers," CEPR Discussion Papers 7694, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:7694
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    3. Lane, Philip R. & Milesi-Ferretti, Gian Maria, 2007. "The external wealth of nations mark II: Revised and extended estimates of foreign assets and liabilities, 1970-2004," Journal of International Economics, Elsevier, vol. 73(2), pages 223-250, November.
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    Cited by:

    1. Bouvatier, Vincent & Capelle-blancard, Gunther & Delatte, Anne-Laure, 2017. "Banks in Tax Havens: First Evidence based on Country-by-Country Reporting," CEPR Discussion Papers 12222, C.E.P.R. Discussion Papers.
    2. Arif, Asma & An, Pengli & Qi, Yajie & Li, Huajiao & An, Haizhong & Hussain, Mujahid & Wang, Yanli, 2021. "The influence factors of the national roles in the FDI network: A combined methods of complex networks and Panel Data Analysis," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 563(C).
    3. Gourinchas, Pierre-Olivier & Rey, Hélène & Truempler, Kai, 2012. "The financial crisis and the geography of wealth transfers," Journal of International Economics, Elsevier, vol. 88(2), pages 266-283.
    4. Mr. Olaf Unteroberdoerster & Ms. Runchana Pongsaparn, 2011. "Financial Integration and Rebalancing in Asia," IMF Working Papers 2011/243, International Monetary Fund.
    5. Carlo Gianelle & Letizia Montinari & Simone Salotti, 2017. "Interregional Trade, Specialization, and the Business Cycle: Policy Implications for the EMU," Journal of Business Cycle Research, Springer;Centre for International Research on Economic Tendency Surveys (CIRET), vol. 13(1), pages 1-27, May.
    6. Carmela D’Avino, 2016. "US banks’ international balance sheet linkages: a data survey," Journal of Financial Economic Policy, Emerald Group Publishing, vol. 8(4), pages 514-531, November.
    7. Cetorelli, Nicola & Goldberg, Linda S., 2012. "Liquidity management of U.S. global banks: Internal capital markets in the great recession," Journal of International Economics, Elsevier, vol. 88(2), pages 299-311.
    8. Vincent Bouvatier & Gunther Capelle-Blancard & Anne-Laure Delatte, 2017. "Banks Defy Gravity in Tax Havens," Working Papers 2017-16, CEPII research center.
    9. Kalemli-Ozcan, Sebnem & Papaioannou, Elias & Perri, Fabrizio, 2013. "Global banks and crisis transmission," Journal of International Economics, Elsevier, vol. 89(2), pages 495-510.
    10. D'Avino, Carmela, 2018. "Quantitative easing, global banks and the international bank lending channel," Economic Modelling, Elsevier, vol. 71(C), pages 234-246.
    11. Jean-Charles Bricongne & Samuel Delpeuch & Margarita Lopez Forero, 2021. "roductivity Slowdown and MNEs' Intangibles: where is productivity measured?," Documents de recherche 21-01, Centre d'Études des Politiques Économiques (EPEE), Université d'Evry Val d'Essonne.
    12. Mary Everett & Vahagn Galstyan, 0. "Bilateral cross-border banking and macroeconomic determinants," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 0, pages 1-24.
    13. Anastasiou, Dimitrios & Drakos, Konstantinos, 2021. "European depositors’ behavior and crisis sentiment," Journal of Economic Behavior & Organization, Elsevier, vol. 184(C), pages 117-136.
    14. Anastasiou, Dimitrios & Katsafados, Apostolos G., 2020. "Bank Deposits Flows and Textual Sentiment: When an ECB President's speech is not just a speech," MPRA Paper 99729, University Library of Munich, Germany.
    15. Balli, Faruk & Basher, Syed Abul & Rana, Faisal, 2014. "The determinants of the volatility of returns on cross-border asset holdings," Journal of International Money and Finance, Elsevier, vol. 44(C), pages 1-23.
    16. Jakob Miethe & Helge Niesytka, 2016. "Tax Evasion and the Impact of International Regulation: A Summary of Empirical Results," DIW Roundup: Politik im Fokus 104, DIW Berlin, German Institute for Economic Research.
    17. McQuade, Peter & Schmitz, Martin, 2017. "The great moderation in international capital flows: A global phenomenon?," Journal of International Money and Finance, Elsevier, vol. 73(PA), pages 188-212.
    18. Hattari, Rabin & S. Rajan, Ramkishen, 2011. "How Different are FDI and FPI Flows?: Distance and Capital Market Integration," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 26, pages 499-525.
    19. Foad, Hisham & Lundberg, Clark, 2017. "The determinants of portfolio investment in offshore financial centers," International Review of Financial Analysis, Elsevier, vol. 54(C), pages 76-86.
    20. Butkiewicz, James L. & Gordon, Leo-Rey C., 2013. "The Economic Growth Effect of Offshore Banking in Host Territories: Evidence from the Caribbean," World Development, Elsevier, vol. 44(C), pages 165-179.
    21. Mary Everett & Vahagn Galstyan, 2020. "Bilateral cross-border banking and macroeconomic determinants," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 156(4), pages 921-944, November.
    22. Garratt, Rodney & Mahadeva, Lavan & Svirydzenka, Katsiaryna, 2011. "The contagious capacity of the international banking network: 1985-2009," University of California at Santa Barbara, Economics Working Paper Series qt0r89f16p, Department of Economics, UC Santa Barbara.
    23. Alexander Krenek & Margit Schratzenstaller, 2018. "A European Net Wealth Tax," WIFO Working Papers 561, WIFO.
    24. Delatte, Anne-Laure & Guillin, Amélie & Vicard, Vincent, 2020. "Grey Zones in Global Finance: the distorted Geography of Cross-Border Investments," CEPR Discussion Papers 14756, C.E.P.R. Discussion Papers.

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    More about this item

    Keywords

    Financial centers; foreign assets; portfolio investment;
    All these keywords.

    JEL classification:

    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements

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