EconPapers    
Economics at your fingertips  
 

Creating the illicit capital flows network in Europe – Do the net errors and omissions follow an economic pattern?

Mária Širaňová (), Menbere Workie Tiruneh and Boris Fisera

International Review of Economics & Finance, 2021, vol. 71, issue C, 955-973

Abstract: This paper uses the Net errors and omissions, a standard measure of illicit capital flows, to create a Europe-wide network of illicit capital flows by the rolling window Granger causality method. In the second stage, we investigate the factors that determine the creation of links among country pairs in the illicit capital flow network by Cragg’s two-stage Tobit model. Our results suggest that the process of link creation is conducive to the long-term interest rate differential, while the frequency of link occurrence is determined by the strength of trade linkages, exposure to FDI flows and differences in economic development associated with overall institutional quality and corporate tax rates.

Keywords: Illicit capital flows; Net errors and omissions; Two-stage tobit model; Financial network (search for similar items in EconPapers)
JEL-codes: F2 F4 F43 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1059056020302483
Full text for ScienceDirect subscribers only

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:eee:reveco:v:71:y:2021:i:c:p:955-973

DOI: 10.1016/j.iref.2020.10.020

Access Statistics for this article

International Review of Economics & Finance is currently edited by H. Beladi and C. Chen

More articles in International Review of Economics & Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2021-10-15
Handle: RePEc:eee:reveco:v:71:y:2021:i:c:p:955-973