Financial openness and capital inflows to emerging markets: In search of robust evidence

Cerdeiro, Diego; Komaromi, Andras

doi:10.1016/j.iref.2021.01.011

Cited by 13 publications

(17 citation statements)

References 33 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…The latter seems to be associated with the relaxation of some confinement measures and the aforementioned policy measures. 21 In this context, inflation in most economies remained at low levels. In particular, infla-tion in advanced economies fell below the targets of their respective central banks.…”

Section: Evolution Of Debt Flows and Global Risk Aversion During The ...mentioning

confidence: 99%

See 1 more Smart Citation

Capital flows to emerging economies and global risk aversion during the COVID‐19 pandemic

et al. 2023

View full text Add to dashboard Cite

This paper analyzes recent changes in the relative importance of the determinants of capital flows to emerging market economies. For this purpose, we estimate vector autoregressive (VAR) models for the period 2009-2020. Based on these models, we estimate the effects on debt flows from shocks to their determinants. Then, we quantify the contribution of each of the variables included in the model to explain the evolution of these flows in each month of the sample through a historical decomposition analysis. The main results indicate that the contribution of global risk aversion to explain the evolution of debt flows increased during March 2020 compared to the past, although its relative importance has decreased since, particularly as the performance of financial markets improved.

show abstract

Section: Evolution Of Debt Flows and Global Risk Aversion During The ...mentioning

confidence: 99%

“…The data reflect transactions at market prices and are not subject to valuation effects. Some empirical studies include Converse et al (2020), Koepke (2018), Cerdeiro and Komaromi (2021), among others. The discrepancy between BoP portfolio flows and EPFR Fund Flows, however, is quite large (Koepke, 2019).…”

Section: Introductionmentioning

confidence: 99%

Capital flows to emerging economies and global risk aversion during the COVID‐19 pandemic

et al. 2023

View full text Add to dashboard Cite

show abstract

“…The reform package includes restructuring and privatization of state owned banks, the introduction of private banking systems, along with bank supervisory and regulatory schemes, the introduction of a variety of measures to promote the development of financial markets; including money and stock markets. International organizations like International Monetary Fund (IMF) and World Bank (WB) as part of an effort of financial sector openness are pressuring Sub-Saharan African countries to privatize the state owned banks and establish capital markets so as to integrate with the rest of the world (Cerdeiro & Komaromi, 2019).…”

Section: Statement Of the Problemmentioning

confidence: 99%

Capital Market Development and Financial Openness in Sub-Saharan Africa

Okafor¹,

Nwakoby²,

Ezu³

2022

IJLTEMAS

View full text Add to dashboard Cite

The inability of capital markets in Sub-Saharan Africa in fund mobilization has affected financial openness in the subcontinent. It has been vigorously argued that financial openness can still thrive without viable capital market but the intermediation function of capital market should not be overlooked. To this end, this study examined the nexus between capital market and financial openness in Sub-Saharan African Countries for 30 years period ranging from 1990 -2019.The study proxied financial openness with capital account balance ratio, private capital inflow ratio, number of listed companies, external finance through foreign capital market and per capita income ratio while capital market development was measured with market capitalization ratio. The study employed secondary data collected from World Development Indicators, Securities and Exchange Commission statistical bulletin, and StockExchange fact books of the respective countries. The study adopted ex-post facto research design while the time series data were analyzed using descriptive statistics, correlation, unit root test, granger causality test, Johansen co-integration and error correction model via E-Views 10. The result revealed that there is no significant relationship between market capitalization ratio and capital account balance ratio in Nigeria; a significant negative relationship between capital account balance ratio and market capitalization ratio in Zimbabwe; a significant positive relationship between private capital inflow ratio and market capitalization ratio in South Africa and a significant positive relationship between private capital inflow ratio and market capitalization ratio in Nigeria. The study recommended that Sub-Saharan Countries should develop trade openness and liberalisation policy that would promote the international relationships necessary for increasing market opportunities and enhancing profitable investments. Therefore the country should continue to develop its capital market to achieve international standards and attract more investors.

show abstract

“…Following Cerdeiro and Komaromi (2019), we include country-fixed effects, in addition to the time-fixed effects, in order to control as tightly as possible for time-invariant omitted variables at the country level. 19 In addition, and in order to achieve identification of the effects of policies, including capital controls, we include interaction terms to analyze how policies interact with the credit gap (the domestic pull factor of interest) in affecting the level of other investment flows.…”

Section: Capital Controls (mentioning

confidence: 99%

Exchange Rates and Domestic Credit—Can Macroprudential Policy Reduce the Link?

Nier¹,

Olafsson²,

Rollinson³

2020

IMF Working Papers

View full text Add to dashboard Cite

This paper examines empirically the role of macroprudential policy in addressing the effects of external shocks on financial stability. In a sample of 62 economies over the period of 2000: Q1–2016: Q4, our dynamic panel regressions show that an appreciation of the local exchange rate is associated with a subsequent increase in the domestic credit gap, while a prior tightening of macroprudential policies dampens this effect. These results are strong for small open economies, and robust when we explicitly account for potential simultaneity and reverse causality biases. We also examine a feedback effect where strong domestic credit pulls in additional cross-border funding, potentially further increasing systemic risk, and find that targeted capital controls can play a complementary role in alleviating this effect.

show abstract

Financial openness and capital inflows to emerging markets: In search of robust evidence

Cited by 13 publications

References 33 publications

Capital flows to emerging economies and global risk aversion during the COVID‐19 pandemic

Capital flows to emerging economies and global risk aversion during the COVID‐19 pandemic

Capital Market Development and Financial Openness in Sub-Saharan Africa

Exchange Rates and Domestic Credit—Can Macroprudential Policy Reduce the Link?

Contact Info

Product

Resources

About