The Financial Center Leverage Cycle: Does It Spread around the World?

Graciela Laura Kaminsky, Leandro Medina () and Shiyi Wang

AEA Papers and Proceedings, 2020, vol. 110, 504-10

Abstract: With a novel database, we examine the evolution of capital flows since the collapse of the Bretton Woods system in the early 1970s. We decompose capital flows into global, regional, and idiosyncratic factors. In contrast to previous findings, which mostly use data from the 2000s, we find that booms and busts in capital flows are mainly explained by regional factors and not the global factor. We link leverage in the financial center to regional capital flows and the cost of borrowing in international capital markets to examine the drivers of capital flow bonanzas and busts.

JEL-codes: E32 E44 F21 F32 G20 (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.aeaweb.org/doi/10.1257/pandp.20201009 (application/pdf)
https://www.aeaweb.org/doi/10.1257/pandp.20201009.ds (application/zip)
https://doi.org/10.3886/E119502V1 (text/html)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
Working Paper: The Financial Center Leverage Cycle: Does it Spread Around the World? (2020)
Working Paper: The Financial Center Leverage Cycle: Does it Spread Around the World? (2020)
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:aea:apandp:v:110:y:2020:p:504-10

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/subscribe.html

DOI: 10.1257/pandp.20201009

Access Statistics for this article

AEA Papers and Proceedings is currently edited by William Johnson and Kelly Markel

More articles in AEA Papers and Proceedings from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().