Financial integration, capital misallocation and global imbalances
Détails
Etat: Public
Version: de l'auteur⸱e
ID Serval
serval:BIB_3A60EEC54772
Type
Article: article d'un périodique ou d'un magazine.
Collection
Publications
Institution
Titre
Financial integration, capital misallocation and global imbalances
Périodique
Journal of International Money and Finance
ISSN
0261-5606
Statut éditorial
Publié
Date de publication
2013
Peer-reviewed
Oui
Volume
32
Pages
324-340
Langue
anglais
Résumé
This paper shows that in a stylized model with two countries, characterized by different levels of financial development, the following facts can be replicated: 1) persistent current account surpluses and 2) high TFP growth in China. Under autarky, entrepreneurs in the emerging country overinvest in short-term projects and underinvest in long-term projects because short-term assets help them secure long-term investments in the presence of credit constraints. This creates an aggregate misallocation of capital. When financial markets integrate, entrepreneurs with long-term projects can have access to cheaper short-term assets abroad, which leaves them more resources to invest in their projects. This both reduces capital misallocations and generates capital outflows.
Mots-clé
Growth, Capital flows, Credit constraints, Financial globalization, Technological change
Web of science
Site de l'éditeur
Open Access
Oui
Création de la notice
15/06/2010 10:58
Dernière modification de la notice
20/08/2019 14:30