Economia Politica

, Volume 35, Issue 3, pp 1055–1080 | Cite as

Firms’ financial surpluses in advanced economies: the role of net foreign direct investments

  • Tatiana Cesaroni
  • Riccardo De Bonis
  • Luigi Infante


According to macroeconomic predictions firms are expected to be net borrowers: the net change of their financial assets should be smaller than the net change of their financial liabilities. However, since the mid-1990s, the non-financial sector has been on average a net lender in countries such as Japan, the UK, Germany and the Netherlands. Conversely firms remained on average net borrowers in countries such as France, Italy and the US. Using financial accounts, we investigate the sources of corporate sector surpluses and deficits applying panel data techniques. Our statistics include 18 industrial countries over the period 1995–2014. We find that firms’ surpluses are structurally linked to net foreign direct investments. The econometric results are robust to the use of variables that control for the business cycle, such as the output gap, the ratio of corporate investment to GDP, firms’ profits and leverage, and taxation.


Net lending/net borrowing Corporate sector Global saving glut Panel data Globalization 

JEL Classification

E2 G3 F6 



We thank Marco Onado for useful discussions on the issue of corporate net lending and Andrea Brandolini, Giuseppe De Arcangelis, Claire Giordano and Roberto Tedeschi for helpful suggestions on an earlier draft. We are indebted to two anonymous referees. The paper also benefited for comments at seminars and conferences held at the 24th International InputOutput Conference at Seoul, Korea (July 2016), at the 8th Irving Fisher Committee Conference at the BIS in Basel (September 2016), at LUISS University (March 2017), at University of Pisa (June 2017), at the International Conference on Small Businesses, Banks, Finance, Innovation and Growth at University of Urbino (October 2017), at the Italian Economist Association Conference (October 2017) and at the Bank of Italy conference “How financial systems works: evidence from financial accounts” (November 2017). The views expressed in this paper do not necessarily represent those of the Bank of Italy.


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Copyright information

© Springer International Publishing AG, part of Springer Nature 2018

Authors and Affiliations

  • Tatiana Cesaroni
    • 1
  • Riccardo De Bonis
    • 1
  • Luigi Infante
    • 1
  1. 1.Bank of ItalyRomeItaly

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