Global Imbalances: The Role of Institutions, Financial Development and FDI in the Context of Financial Crises

Sustainability

CarlosA. Silva¹  Alfredo Jiménez²  Xavier Ordeñana³  Paul Vera-Gilces³ 

[1] Department of Economics and Related Studies, University of York, York YO10 5DD, UK;Department of Management, KEDGE Business School, 33405 Bordeaux, France;ESPAE Escuela de Negocios de la ESPOL, Malecón 100 y Loja, Guayaquil 090313, Ecuador;

关键词: current accounts;    financial crises;    capital inflows;    global imbalances;   

DOI  :  10.3390/su13010356

来源: DOAJ

【 摘 要 】

This paper examines the role of the quality of institutions, financial development and FDI on current account imbalances, which narrowed during the Global Financial Crisis. In doing so, we utilize (i) a sample of 49 advanced and emerging economies during 1984–2014; (ii) a novel three-clustered indices of institutional quality and (iii) two measures of financial development, the share of FDI and a measure of financial crisis in addition to standard determinants of the current account. We find that the better the quality of institutions and the greater the financial development, the larger are current account deficits; meanwhile, FDI contributes to boost current account balances. Moreover, financial crisis episodes tend to improve current account balances, particularly for countries that are highly open to trade and to receive FDI, as in the case of advanced economies and East Asian countries.

【 授权许可】

Unknown