Fiscal policy is procyclical in developing countries. An ample literature has explained this fact and explored its consequences for aggregate cyclical fluctuations. Multilateral Development Banks (MDBs) are an important source of finance for governments and therefore play a role in the execution...

Purpose - The issue of which financial initial conditions are necessary to materialize the benefits of financial globalization remains open to debate in the literature. In this paper, we try to put some empirical structure on the concept of financial threshold conditions in order to give...

Purpose - This study assesses the effect of time-dynamic financial globalisation uncertainty on financial development in 53 African countries for the period 2000-2011. Design/methodology/approach - Financial globalisation uncertainty is estimated as time-dynamic to capture business cycle...

We review the large literature on various economic policies that could help developing economies effectively manage the process of financial globalization. Our central findings indicate that policies promoting financial sector development, institutional quality, and trade openness appear to help...

According to standard economic theory, capital should flow from rich to poor countries. However, a reverse pattern has prevailed in the world economy. This is the so-called Lucas paradox. In addition, it has been shown that, counterintuitively, there is a negative correlation between capital...

Using a newly developed dataset this paper examines the cyclicality of private capital inflows to low-income developing countries (LIDCs) over the period 1990-2012. The empirical analysis shows that capital inflows to LIDCs are procyclical, yet considerably less procyclical than flows to more...

Using a newly developed dataset this paper examines the cyclicality of private capital inflows to low-income developing countries (LIDCs). The empirical analysis shows that capital inflows to LIDCs are procyclical, yet considerably less procyclical than flows to more advanced economies. The...

According to a standard economic theory, capital should flow from rich capital-abundant countries to poor capital-scarce countries. However, a reverse pattern has prevailed in the world economy. This is the so-called Lucas paradox. In addition, it has been shown that counterintuitively there is...

We decompose capital flows - both debt and equity - into public and private components and study their relationship with productivity growth. This exercise reveals that international capital flows are mainly shaped by government decisions and sovereign to sovereign transactions. Specifically, we...

We construct measures of net private and public capital flows for a large cross-section of developing countries considering both creditor and debtor side of the international debt transactions. Using these measures, we demonstrate that sovereign-to-sovereign transactions account for upstream...