Gross Private Capital Flows to Emerging Markets: Can the Global Financial Cycle Be Tamed?

Nier, Erlend; Sedik, Tahsin Saadi; Mondino, Tomas

doi:10.5089/9781498351867.001

Cited by 69 publications

(44 citation statements)

References 18 publications

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“…There remains the question of why inflation occurs at shorter horizons. There is a growing body of evidence suggesting that capital flight out of emerging markets is driven by global risk shocks as proxied by indices such as the VIX (Nier et al ., ; Passari and Rey, ). If this capital flight is associated with nominal exchange rate depreciation then import prices should rise in the short term.…”

Section: Discussion Of Resultsmentioning

confidence: 98%

Macroeconomic Uncertainty in South Africa

Redl¹

2018

South African J Economics

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This paper develops a new index of economic uncertainty for South Africa for the period 1990–2014. The index is constructed from three sources: (1) Disagreement among professional forecasters, (2) a count of international and local newspaper articles discussing economic uncertainty in South Africa and (3) mentions of uncertainty in the quarterly economic review of the South African Reserve Bank. The index shows high levels of uncertainty around the period of democratic transition in 1992–1994, the large depreciation of the currency in 2001 and the financial crisis of 2008. The uncertainty index is a leading indicator of a recession. An unanticipated increase in the index is associated with a fall in GDP, investment, industrial production and private sector employment. Contrary to evidence for the U.S.A and the U.K., uncertainty shocks are inflationary. These results are robust to controlling for global uncertainty shocks, consumer confidence and financial shocks.

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Section: Discussion Of Resultsmentioning

confidence: 98%

Macroeconomic Uncertainty in South Africa

Redl¹

2018

South African J Economics

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“…This happened not least since financial account liberalisation was typically required under the IMF and World Bank's structural adjustment packages, implemented in many developing countries as result of mounting exchange rate pressures and foreign-denominated debt burdens (for instance, see Moyo, 2001, for Zambia in the 1990s). Financial flows into EMEs picked up over the 1990s and surged in the 2000s (Schmuckler, 2004;Aizenman, Jinjarak, & Park, 2011;Nier, Saadi Sedik, & Mondino, 2014). …”

Section: Financialisation In Emerging Economies: a Literature Reviewmentioning

confidence: 99%

Financialisation in emerging economies: a systematic overview and comparison with Anglo-Saxon economies

Karwowski

Stockhammer

2017

Economic and Political Studies

126

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Financialisation research has originally focussed on the US experience, but the concept is now increasingly applied to emerging economies (EMEs). There is a rich literature stressing peculiarities of individual country experiences, but little systematic comparison across EMEs. This paper fills this gap, providing an overview of the debate and identifying six financialisation interpretations for EMEs. These different interpretations stress (1) financial deregulation (2) foreign financial inflows, (3) asset price volatility, (4) the shift from bankbased to market-based finance, (5) business debt, and (6) household indebtedness. We construct and compare measures of the six financialisation interpretations across a sample of 17 EMEs from Latin America, emerging Europe, Africa and Asia, contrasting them with the US and UK, two financialised economies. We find considerable variation in financialisation experiences of EMEs. Asset price volatility is found across continents. Asia has been more exposed to capital inflows, stock markets have gained importance and private sector debt risen. In emerging Europe financial deregulation has been more pronounced with lower levels but strong increases in household debt. The picture is similar in South Africa, the African EME in the sample, where household debt is comparatively high. Financialisation in Latin America is weaker according to our measures.Keywords: Financialisation; Emerging markets; Financial instability; Asset price volatility; Heterodox economics JEL codes: F30; F34; G01; G12; G15; B50 Acknowledgements: We would like to thank our colleague Rex McKenzie for comments on the paper. The usual disclaimers apply.

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“…Our results show that the VXO effect on CI dominates the effects of the macroeconomic absorptive capacity control variables as countries move from the efficiency‐ to the innovation‐driven stage. Similarly, Nier et al () find that the VXO effect is prevalent in countries that have a higher level of financial market development and capital openness features. We also find a higher coefficient for lagged CI in the efficiency‐driven countries.…”

Section: Resultsmentioning

confidence: 90%

Nexus between Institutional Quality and Capital Inflows at Different Stages of Economic Development

Athari

Adaoglu

2017

Int Rev Finance

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We examine the determinants of capital inflows for a global sample of countries at various stages of economic development, namely factor‐, efficiency‐, and innovation‐driven stages. We investigate the effect of institutional quality on capital inflows. The magnitude of institutional quality effect depends on the stage of economic development. Both public and private institutional qualities positively affect capital inflows in efficiency‐ and innovation‐driven countries. Specifically, corporate ethics and accountability are pull factors for capital inflows at all stages.

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Gross Private Capital Flows to Emerging Markets: Can the Global Financial Cycle Be Tamed?

Cited by 69 publications

References 18 publications

Macroeconomic Uncertainty in South Africa

Macroeconomic Uncertainty in South Africa

Financialisation in emerging economies: a systematic overview and comparison with Anglo-Saxon economies

Nexus between Institutional Quality and Capital Inflows at Different Stages of Economic Development

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