The internationalization of financial markets is one of the focal points in the discussion about recent globalization trends. These discussions suggest that capital can move freely between countries. However, there is ample evidence that national borders do matter and that there are many...

Weakening bargaining power of unions and the increasing integration of the world economy may affect the volatility of capital and labor incomes. This paper documents and explains changes in income volatility. Using a theoretical framework which builds distribution risk into a real business cycle...

Information costs and regulatory barriers are the main distinguishing features of international financial markets as compared to national financial markets. This paper presents a simple model of the impact of these factors on banks' cross-border activities and provides empirical evidence. Our...

Pecking order models of international finance suggest that countries should become less reliant on international bank lending as they develop. Reduced information costs are one of the factors behind this trend towards disintermediation. This paper presents a simple model on the choice between...

Globalization has affected the integration of markets through many different channels, including movements of factors and trade in goods. From a theoretical point of view, the interaction between the different channels of integration can take different forms. The aim of this paper is to analyze...

If the technological revolution which has taken place over the past decades has lowered information costs and if information costs increase in distance, distance should – ceteris paribus – become less important in determining international bank lending. We are using a dataset on assets and...