The International Equity Holdings of Euro Area Investors

Philip Lane and Gian Maria Milesi-Ferretti ()

The Institute for International Integration Studies Discussion Paper Series from IIIS

Abstract: We provide a systematic analysis of bilateral, source and host factors driving portfolio equity investment by euro-area countries, using newly-released data on international equity holdings at the end of 2001. We find that bilateral equity holdings are strongly linked to bilateral trade in goods and services and are also associated with proxies for informational proximity. We further document that there exists a significant “euro-area bias”, with euro-area countries investing in other euro-area countries over and above the amount predicted by underlying fundamentals.

Keywords: International portfolio equity investment, international trade; gravity. (search for similar items in EconPapers)
JEL-codes: F21 F34 (search for similar items in EconPapers)
Date: 2005-12-15
New Economics Papers: this item is included in nep-eec and nep-int
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Citations: View citations in EconPapers (43)

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Persistent link: https://EconPapers.repec.org/RePEc:iis:dispap:iiisdp104

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