Capital flow waves to and from Switzerland before and after the financial crisis

Pinar Yesin

No 2015-01, Working Papers from Swiss National Bank

Abstract: This paper first shows that capital inflows to and outflows from financial centres were disproportionately affected by the global financial crisis. Switzerland was no exception. The paper then identifies waves of capital flows to and from Switzerland from 2000:Q1 to 2014:Q2 by using a simple statistical method. The analysis shows that private capital inflows to and outflows from Switzerland have become exceptionally muted and less volatile since the crisis. Further, strong and long-lasting 'home bias' behaviour can be observed for both Swiss and foreign investors. By contrast, net private capital flows have shown significantly higher volatility since the financial crisis, frequently registering extreme movements driven by extreme movements in bank lending flows. These findings suggest that the financial crisis generated a breaking point for capital flows to and from Switzerland.

Keywords: private capital flows; inflows; outflows; surges; stops; retrenchment; flight (search for similar items in EconPapers)
JEL-codes: F21 F31 F32 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2015
New Economics Papers: this item is included in nep-ifn and nep-opm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Journal Article: Capital Flow Waves to and from Switzerland before and after the Financial Crisis (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:snb:snbwpa:2015-01

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