Globalisation and governance: Thresholds for the impacts of the main determinants of capital inflows?

ÖZMEN E., Taşdemir F.

International Review of Economics and Finance, cilt.92, ss.168-176, 2024 (SSCI) identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 92
  • Basım Tarihi: 2024
  • Doi Numarası: 10.1016/j.iref.2024.02.025
  • Dergi Adı: International Review of Economics and Finance
  • Derginin Tarandığı İndeksler: Social Sciences Citation Index (SSCI), Scopus, ABI/INFORM, Business Source Elite, Business Source Premier, EconLit
  • Sayfa Sayıları: ss.168-176
  • Anahtar Kelimeler: Capital inflows, Developing and emerging economies, Financial openness, Global financial conditions, Governance
  • Orta Doğu Teknik Üniversitesi Adresli: Evet

Özet

This paper investigates whether the impacts of the main push (global financial conditions, GFC) and pull (growth) factors on capital inflows are invariant to endogenously estimated threshold levels for structural domestic conditions (SDC) represented by governance, trade openness, de facto international financial integration and de jure financial openness in emerging market and developing economies. Our results strongly suggest that, for all the components of capital inflows, the impact of the domestic pull factor is substantially much higher for the episodes of better governance, higher trade, de jure financial openness and de facto international financial integration. The sensitivity of non-FDI and aggregate inflows to GFC tends to be considerably higher for the episodes of better SDC. FDI inflows are found to be basically determined by the domestic pull factor across all these regimes. The impact of GFC on FDI inflows appears not to considerably change across the SDC.