Globalization and Capital Mobility: Opportunity or Instability?

Abstract

Portfolio investment has frequently come under attack for being the most egregious manifestation of globalization. This is largely because of its relative liquidity and high levels of mobility, but also stems from an apparent underlying skepticism about the role and motives of capital markets – and indeed markets in general in poor countries. Rooted in dependency theory, however, critiques of equity investment have been highly selective both in their examples and in their analytical assessments of the impact of these kinds of investment flows.