External liabilities and crises

Catão, Luis; Milesi‐Ferretti, Gian Maria

doi:10.1016/j.jinteco.2014.05.003

Cited by 214 publications

(179 citation statements)

References 49 publications

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“…16 The ratio of private credit to GDP (measured in 2005-06) is included as larger values tend to be associated with excesses in the financial sector resulting in a more pronounced boom-bust cycle and potentially debt overhang (see for example Gourinchas and Obstfeld, 2012). 17 The inclu- In other regressions we control for being a euro area Member State, include measures of financial remoteness (Schmitz, 2014) and changes in the oil balance and the financial cycle.…”

Section: Empirical Frameworkmentioning

confidence: 99%

The great moderation in international capital flows: A global phenomenon?

McQuade

Schmitz

2017

Journal of International Money and Finance

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may No 1952 / August 2016Note: This Working Paper should not be reported as representing the views of the European Central Bank (ECB). The views expressed are those of the authors and do not necessarily reflect those of the ECB Abstract This paper highlights a recent 'great moderation' in global capital flows, characterised by smaller volumes and lower volatility of cross-border transactions. However, there are substantial differences across countries and regions which we analyse by comparing the level of international capital flows observed in 2005-06, immediately prior to the onset of the global financial crisis, to the post-crisis period of 2013-14, when global flows arguably settled at a 'new normal'. We find that since the pre-crisis period, gross capital inflows recovered more for economies with smaller pre-crisis external and internal imbalances, lower per capita income, improving growth expectations, a less severe impact of the global financial crisis and less stringent macroprudential policy. On the asset side, countries with a more accommodative monetary policy, a milder impact of the crisis and oil exporters managed to increase gross capital outflows in the post-crisis period.

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Section: Empirical Frameworkmentioning

confidence: 99%

The great moderation in international capital flows: A global phenomenon?

McQuade

Schmitz

2017

Journal of International Money and Finance

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“…Figure 1 shows the proportion of countries in Latin America and the Caribbean, and in the rest of the world, which enter into external crisis on a given year. The crisis definition and the sample we use as baseline are from Catão and Milesi-Ferretti (2014). The definition of external crisis includes defaults and rescheduling events as well as events of IMF support higher than twice the respective country's IMF quota.…”

Section: Introductionmentioning

confidence: 99%

Varieties of Saving and Crises

Cavallo¹,

Fernández‐Arias²,

Marzani³

2016

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work is licensed under a Creative Commons IGO 3.0 AttributionNonCommercial-NoDerivatives (CC-IGO BY-NC-ND 3.0 IGO) license (http://creativecommons.org/licenses/by-nc-nd/3.0/igo/ legalcode) and may be reproduced with attribution to the IDB and for any non-commercial purpose. No derivative work is allowed.Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC-IGO license.Note that link provided above includes additional terms and conditions of the license.The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent.http://www.iadb.org 20161 Abstract * This paper shows, using probit analysis, that low national savings increase the risk of macroeconomic crisis. Foreign savings are a poor substitute of national savings not only for domestic investment (Feldstein-Horioka result), but also for stability. It is found that deeper financial integration does not cure low investment and can improve the situation only to the extent that the risks of the foreign saving portfolio can be kept under control. Overall, a fundamental conclusion is that strong national savings are key for robust growth. Extending the probit analysis, the paper shows that the composition of foreign assets and liabilities matters substantially for portfolio risk and derives an index to assess the associated country risk.JEL classifications: E21, E22, E44, F32, F34, G01, G15, H63

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“…On top of that, deeper integration measured with the equity (EQI) over the studied period can be explained by relatively high share of State-owned enterprises privatised step by step, which encouraged foreign investors to invest in equity within the framework of both FDI and portfolio capital. Catao and Milesi-Ferretti (2013) attempted to identify the determinants of financial crises paying special attention to the role of foreign liabilities and their structure. The period of the study covers the years 1970-2011 and the study concerns 70 countries including 41 developing ones.…”

Section: Research Methodology and Process Researchmentioning

confidence: 99%

Capital Flows in European Union on the Basis of International Investment Position – Selected Aspects

Maciejczyk-Bujnowicz

2016

CJFA

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Abstract:The paper aims at assessing the changes in flows of selected forms of capital under deepening financial integration in the European Union. EU Member States are divided into two groups: members of the euro area and those outside of it. The analysis coincides with the establishing of the EU monetary union and covers the turn and early 21st century. Research method applied in this particular study includes the overview of theoretical concepts, literature review and a comparative statistical analysis based on statistical data. Analyses of selected data revealed significant differences between developed and developing countries when it comes to various forms of net capital and its relation to the GDP based on the International Investment Position. Moreover, we evaluated the International Investment Position of Poland against the backdrop of selected countries of Central and Eastern Europe and the eurozone members.

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External liabilities and crises

Cited by 214 publications

References 49 publications

The great moderation in international capital flows: A global phenomenon?

The great moderation in international capital flows: A global phenomenon?

Varieties of Saving and Crises

Capital Flows in European Union on the Basis of International Investment Position – Selected Aspects

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