Capital Flight to Germany: Two Alternative Measures
Sven Steinkamp () and
No 115, IEER Working Papers from Institute of Empirical Economic Research, Osnabrueck University
We use two measures to study two capital flight channels for Germany. One measure is based on the concept of trade misinvoicing and one on net claims and liabilities in the Eurosystem of central banks. For both measures, we propose refinements to enhance the assessment of capital flight. We find that capital flight towards Germany via these two channels has been quite sizable in the recent decade and can tally to about 2% of GDP annually. Regarding their determinants, we show that the two capital flight measures are driven by both common and measure-specific factors. Traditional determinants such as covered interest differentials only play a limited role, while crisis-specific factors such as economic policy uncertainty, the ECB collateral policy, as well as currency misalignment are driving factors of the investors’ apparent flight-to-safety behavior.
Keywords: Illicit Capital Flight; Trade Misinvoicing; TARGET2 Balance; Flight-to-safety; Economic Policy Uncertainty (search for similar items in EconPapers)
JEL-codes: F3 F32 G15 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eec
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
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:iee:wpaper:wp0115
Access Statistics for this paper
More papers in IEER Working Papers from Institute of Empirical Economic Research, Osnabrueck University Rolandstrasse 8, 49069 Osnabrueck. Contact information at EDIRC.
Bibliographic data for series maintained by Karin Wessler-Rensmann ().