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ASSESSMENT OF ILLEGAL CAPITAL FLOWS IN THE REPUBLIC OF MOLDOVA

Tatiana Petrova (), Victoria Iordachi () and Dorina Clichici ()
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Tatiana Petrova: INCE

ECONOMY AND SOCIOLOGY: Theoretical and Scientifical Journal, 2017, issue 1-2, 95-102

Abstract: This paper analyses the existent methodologies used in international practice to estimate illegal capital outflows. Also, authors carried out an assessment of the illegal capital outflows in the Republic of Moldova on the basis of two models: the general method based on the balance of payments and the World Bank’s "residual" model. The paper reflects the exceptional situation of the financial system of the Republic of Moldova and trends in evolution of capital flows. The analysis of illegal flows should be part of the monitoring system of the country’s financial stability, which will allow identifying in time negative trends that threaten Moldova's financial security. The main research methods were systemic analysis and logic synthesis; data analysis and interpretation; statistical methods, etc. The main conclusions obtained within the research of this topic are: for more reliable estimates for analytical purposes, it is necessary to develop an adequate methodological base that would help to measure and analyze shadow cross-border flows; for the assessment of the financial security of the Republic of Moldova, as a transition economy, it is important to monitor, analyze and forecast a broader list of financial indicators, as well as their critical values.

Keywords: capital outflow; illegal flows, balance of payments; financial stability, capital flight, World Bank, Residual model, Trade misinvoicing model (search for similar items in EconPapers)
JEL-codes: F21 F32 (search for similar items in EconPapers)
Date: 2017
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