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on International Finance |
| By: | Atish R. Ghosh; Mahvash Saeed Qureshi; Naotaka Sugawara |
| Abstract: | This paper examines whether cross-border capital flows can be regulated by imposing capital account restrictions (CARs) in both source and recipient countries, as was originally advocated by John Maynard Keynes and Harry Dexter White. To this end, we use data on bilateral cross-border bank flows from 31 source to 76 recipient (advanced and emerging market) countries over 1995–2012, and combine this information with a new and comprehensive dataset on various outflow and inflow related capital controls and prudential measures in these countries. Our findings suggest that CARs at either end can significantly influence the volume of cross-border bank flows, with restrictions at both ends associated with a larger reduction in flows. We also find evidence of cross-border spillovers whereby inflow restrictions imposed by countries are associated with larger flows to other countries. These findings suggest a useful scope for policy coordination between source and recipient countries, as well as among recipient countries, to better manage potentially disruptive flows. |
| Keywords: | Capital flows;Capital account;Cross-border banking;Spillovers;Capital inflows;Capital controls;cross-boder bank flows, capital controls, prudential measures |
| Date: | 2014–10–17 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:14/188&r=ifn |
| By: | Girma, Sourafel (University of Nottingham); Gong, Yundan (Aston University); Görg, Holger (Kiel Institute for the World Economy); Lancheros, Sandra (University of Nottingham) |
| Abstract: | We implement a method to estimate the direct effects of foreign-ownership on foreign firms' productivity and the indirect effects (or spillovers) from the presence of foreign-owned firms on other foreign and domestic firms' productivity in a unifying framework, taking interactions between firms into account. To do so, we relax a fundamental assumption made in empirical studies examining a direct causal effect of foreign ownership on firm productivity, namely that of no interactions between firms. Based on our approach, we are able to combine direct and indirect effects of foreign ownership and calculate the total effect of foreign firms on local productivity. Our results show that all these effects vary with the level of foreign presence within a cluster, an important finding for the academic literature and policy debate on the benefits of attracting foreign owned firms. |
| Keywords: | propensity score matching, SUTVA, foreign direct investment, interactions |
| JEL: | F23 |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8509&r=ifn |