Financial Diversification and Sudden Stops
Kevin Cowan (),
Jose De Gregorio (),
Alejandro Micco () and
Christopher Neilson ()
Journal Economía Chilena (The Chilean Economy), 2007, vol. 10, issue 3, 45-65
Recent literature on sudden stops analyses the sharp and varied capital account reversals experienced by many emerging market economies. This paper claims that more information can be extracted from the behavior of gross capital flows than from their net results. It emphasizes the fact that, while one economy’s sudden stop can reveal exclusion from the international financial markets, another can be making adjustments to its investment portfolio causing a sudden start, and both produce the same net effect on the capital account. We present a simple model that rationalizes this empirical fact and its relationship with the economy’s financial diversification.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed
Downloads: (external link)
https://si2.bcentral.cl/public/pdf/revista-economi ... n3dic2007pp45-65.pdf (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:chb:bcchec:v:10:y:2007:i:3:p:45-65
Access Statistics for this article
Journal Economía Chilena (The Chilean Economy) is currently edited by Roberto Alvarez, Miguel Fuentes and Claudio Raddatz
More articles in Journal Economía Chilena (The Chilean Economy) from Central Bank of Chile Contact information at EDIRC.
Bibliographic data for series maintained by Claudio Sepulveda ().