EconPapers    
Economics at your fingertips  
 

Net foreign asset (com)position: Does financial development matter?

Robert Vermeulen and Jakob de Haan ()

Journal of International Money and Finance, 2014, vol. 43, issue C, 88-106

Abstract: We investigate the relationship between a country's domestic financial development and the (composition of its) net foreign asset position using a pooled mean group estimator and data for 50 countries for the 1970–2007 period. The results show that financial development reduces a country's long-run net foreign asset position. In addition, financial development leads to higher net equity and lower net debt positions. These findings confirm the theoretical predictions of Mendoza et al. (2009). The results are robust to using different indicators of financial development and inclusion of the level of development of a country in the cointegrating relationship.

Keywords: Net foreign assets; Financial development; Financial integration; Pooled mean group estimator (search for similar items in EconPapers)
JEL-codes: F30 F41 G15 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0261560614000023
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Net Foreign Asset (Com)position: Does Financial Development Matter? (2012) Downloads
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:eee:jimfin:v:43:y:2014:i:c:p:88-106

Access Statistics for this article

Journal of International Money and Finance is currently edited by J. R. Lothian

More articles in Journal of International Money and Finance from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-10-20
Handle: RePEc:eee:jimfin:v:43:y:2014:i:c:p:88-106