Volatility of capital flows and financial liberalization: Do specific flows respond differently?

Neumann, Rebecca; Penl, Ron; Tanku, Altin

doi:10.1016/j.iref.2008.04.005

Cited by 88 publications

(56 citation statements)

References 17 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…1 FDI flows to the developing world also increased rapidly, although the developed countries generally received more FDI flows than the developing ones and host the majority of the inward FDI stock (UNCTAD 2011). Importantly, the volatility of FDI flows has increased tremendously over the past decades, especially in developing countries (Goldstein and Razin 2006;Neumann et al 2009). Despite the fact that FDI is regarded as one of the most stable types of capital flows (Lipsey 2001;Albuquerque 2003;Broto et al 2011), there have been distinct waves of FDI since the 1980s with corresponding surges and stops (Andrade et al 2001).…”

Section: Introductionmentioning

confidence: 99%

Surges and stops in greenfield and M&A FDI flows to developing countries: analysis by mode of entry

Burger

Ianchovichina

2017

Rev World Econ

View full text Add to dashboard Cite

This paper investigates the factors associated with foreign direct investment ''surges'' and ''stops'', defined as sharp increases and decreases, respectively, of foreign direct investment inflows to the developing world and differentiated based on whether these events are led by waves in greenfield investments or mergers and acquisitions. Greenfield-led surges and stops occur more frequently than mergers-and-acquisitions-led ones and different factors are associated with the onset of the two types of events. Global liquidity is the factor significantly and positively associated with a surge, regardless of its kind, while a global economic growth slowdown and a surge in the preceding year are the main factors associated with a stop. Greenfield-led surges and stops are more likely in low-income countries and mergers-and-acquisitions-led surges are less likely in resource-rich countries than elsewhere in the developing world. Global growth accelerations and increases in financial openness, domestic economic and financial instability are associated with mergers-and-acquisitions-led surges but not with greenfield-led ones. These results are particularly relevant for developing countries where FDI flows are the major type of capital flows and suggest that developing countries' macroeconomic vulnerability increases following periods of increased global liquidity. As countries Electronic supplementary material The online version of this article

show abstract

Section: Introductionmentioning

confidence: 99%

Surges and stops in greenfield and M&A FDI flows to developing countries: analysis by mode of entry

Burger

Ianchovichina

2017

Rev World Econ

View full text Add to dashboard Cite

show abstract

“…For the volatility of FDI inflow, the standard deviation over a rolling window of annual data (three years) as Neumann et al (2009) andIMF (2007). A panel data set to analyze which factors explain the observed volatility patterns.…”

Section: Methodsmentioning

confidence: 99%

“…Engle, Gonzalo and Rangel (2008) and Broto et al (2011) employed the method that generates volatilities with a low correlation than the other studies. Neumann et al (2009) showed that financial integration tends to increase the volatility of FDI in emerging economies. Chee-Keong and Siew-Yong (2011) showed that financial sector development is a significant element for FDI.…”

Section: Introductionmentioning

confidence: 99%

The Deterministic Elements of FDI to ASEAN Countries: The Relationship between FDI and Macroeconomic Variables

Kurihara¹

2012

JMS

View full text Add to dashboard Cite

This article examines the deterministic elements of FDI (foreign direct investment) flows into ASEAN countries. It uses a panel data in ASEAN countries and US to analyze the relationship between FDI into ASEAN and macroeconomic variables. Domestic (ASEAN) economic growth, domestic prices in ASEAN and US prices promote FDI into ASEAN. On the other hand, the relationships between FDI volatility and domestic GDP, and the FDI volatility and US price, are not found. Rises in domestic prices increase FDI volatility.

show abstract

“…Beck, et al (2000) suggest that financial systems are important for both productivity and development. Rebecca M., et al (2009 ) examined the volatility of capital flows (FDI, portfolio flows, and other debt flows) following the liberalization of financial market and they found that capital flows are responding differently to financial liberalization. Surprisingly, portfolio flows appear to show little response to capital liberalization, while FDI flows show significant increases in volatility, particularly for the emerging markets.…”

Section: Greenwoodmentioning

confidence: 99%

FDI, Local Financial Markets, Employment and Poverty Alleviation

Mahmoud

2010

SSRN Journal

View full text Add to dashboard Cite

This paper examines the precise links between foreign direct investment (henceforth, FDI) and poverty alleviation, where so far there are few studies attempted to analyze empirically this relationship. The FDI inflows vary across international borders, therefore FDI reduces poverty only under certain circumstances. -Roll out the red carpet for foreign investors and they will come‖ ; Countries with better financial systems, and healthy business environment are able to attract more FDI, exploit it more efficiently and reduce poverty. Empirical analysis using panel data of 62 countries, from 1996 to 2007, shows that FDI appears regularly to be a key source of employment for women in Non OECD countries and has a favorable effect on poverty reduction in the host country if interacted with monetary and nonmonetary variables.

show abstract

Volatility of capital flows and financial liberalization: Do specific flows respond differently?

Cited by 88 publications

References 17 publications

Surges and stops in greenfield and M&A FDI flows to developing countries: analysis by mode of entry

Surges and stops in greenfield and M&A FDI flows to developing countries: analysis by mode of entry

The Deterministic Elements of FDI to ASEAN Countries: The Relationship between FDI and Macroeconomic Variables

FDI, Local Financial Markets, Employment and Poverty Alleviation

Contact Info

Product

Resources

About