Capital Flows to Developing Countries: Long- and Short-Term Determinants

Mark Taylor and Lucio Sarno

The World Bank Economic Review, 1997, vol. 11, issue 3, 451-70

Abstract: This article focuses on the determinants of the large portfolio flows from the United States to Latin American and Asian countries during 1988-92. Cointegration techniques reveal that both domestic and global factors explain bond and equity flows to developing countries and represent significant long-run determinants of portfolio flows. The article also investigates the dynamics of portfolio flows by estimating seemingly unrelated error-correction models. Global and country-specific factors are equally important in determining the long-run movements in equity flows for both Asian and Latin American countries, while global factors are much more important than domestic factors in explaining the dynamics of bond flows. U.S. interest rates are a particularly important determinant of the short-run dynamics of portfolio, especially bond flows to developing countries. Copyright 1997 by Oxford University Press.

Date: 1997
References: Add references at CitEc
Citations: View citations in EconPapers (158)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:wbecrv:v:11:y:1997:i:3:p:451-70

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

The World Bank Economic Review is currently edited by Eric Edmonds and Nina Pavcnik

More articles in The World Bank Economic Review from World Bank Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK. Contact information at EDIRC.
Bibliographic data for series maintained by Oxford University Press ().