To enhance the inflow of foreign direct investment (FDI) and ultimately to increase the economic growth, the countries have implemented a variety of financial and trade liberalization policies in the last three decades. Pakistan also initiated such type of policies. This study makes an analysis...

This paper examines the Lucas Paradox and the Allocation Puzzle of international capital flows referring to a panel data set of EMU countries and major industrialized and emerging economies. Overall, the results do not provide evidence in favour of the Lucas Paradox and the Allocation Puzzle....

In this paper, we examine theoretically how corporate saving in emerging markets is contributing to global rebalancing. We consider a two-country dynamic general equilibrium model, based on Bacchetta and Benhima (2014), with a Developed and an Emerging country. Firms need to save in liquid...

This paper examines the Lucas Paradox and the Allocation Puzzle of international capital flows referring to a panel data set of EMU countries and major industrialized and emerging economies. Overall, the results do not provide evidence in favour of the Lucas Paradox and the Allocation Puzzle....

We use the neoclassical growth framework to model international capital flows in an economy with exogenous demographic change. We compare model implications and actual current account data and find that the model explains a small but significant fraction of capital flows between OECD countries,...

Financial capital and fixed capital tend to flow in opposite directions between poor and rich countries. Why? What are the implications of such two-way capital flows for global trade imbalances and welfare in the long run? This paper introduces frictions into a standard two-country neoclassical...

We examine the relationship between investment and saving for a cross section of European countries before and during the euro crisis. Investment is positively and significantly related to saving, and this relationship is stronger during the euro crisis period. This increase is a departure from...

We demonstrate that the correlation of saving and investment is measured best by an error correction model (ECM), because theory implies a cointegrating relation between these variables. The ECM comprises all previous specifications as special cases, which are shown to be potentially...

The study investigated the impact of sovereign credit ratings on foreign portfolio investment (FPI) flows to emerging markets through panel data for seven markets (Argentina, Brazil, Egypt, India, Nigeria, South Africa and the United Arab Emirates) during the period from 2015 to 2019 on a...

This study examines the complementarity or substitutability of regional capital mobility to global capital mobility within the Sub-Saharan African (SSA) economies. With a re-specified inter-temporal consumption framework, the savings-investment correlation of the Feldstein-Horioka (hereinafter...