Grey ZOnes in Global Finance: the Distorted Geography of Cross Border Investments

Vincent Vicard and Guillin Amélie ()

Working Papers from HAL

Abstract: Tax avoidance schemes generate artificially complex cross-border financial structures inflatingmeasured international investment stocks in tax havens. Using a standard gravity framework, weestimate that about 40\% of global assets (FDI, portfolio equity and debt) are 'abnormal' -unexplained - stocks. Abnormal stocks are increasing over time and concentrated in a limitednumber of jurisdictions. Six jurisdictions including three European countries are the largestcontributors: Cayman, Bermuda, Luxembourg, Hong Kong, Ireland and the Netherlands.Interestingly, the Luxleaks in 2014 do not appear to have diverted cross-border investments away

Keywords: Cross-border investments; Capital openness; tax havens; Gravity Equation (search for similar items in EconPapers)
Date: 2021-01-07
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Related works:
Journal Article: Grey zones in global finance: The distorted geography of cross-border investments (2022)
Working Paper: Grey zones in global finance: The distorted geography of cross-border investments (2022)
Working Paper: Grey Zones in Global Finance: the Distorted Geography of Cross-Border Investments (2020)
Working Paper: Grey Zones in Global Finance: the distorted Geography of Cross-Border Investments (2020)
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