Abstract
During the 1990s, emerging countries enjoyed dramatic inflows, which boosted their financial resources but also increased their vulnerability to financial turbulence. However capital flows to emerging markets have steadily declined since their peak of nearly US$240 bn. in 1995 according to the IMF. A key issue is whether these changes, both the sharp declines and changes in composition of the flows, are cyclical rather than structural, long term or short term.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsPreview
Unable to display preview. Download preview PDF.
Notes
JP Morgan, “Emerging Markets Debt: Outlook for 2002,” New York, JP Morgan Emerging Markets Research, December 17, 2001, pp. 4 and 6
See Sebastian Edwards, ed., Capital Flows and the Emerging Economies, Chicago, Ill., The University of Chicago Press, 2000.
See Michael Bordo, Barry Eichengreen, Daniela Klingebiel and Maria Soledad Martinez-Peria, “Is the Crisis Problem Growing More Severe?”, Economic Policy, vol. 16, no. 32, April 2001, pp. 51–82.
Charles Kindleberger, Manias, Panics and Crashes. A History of Financial Crises New York, John Wiley & Sons, 1996 and 2001.
See the two economist’s essay Kevin O’Rourke and Jeffrey Williamson, Globalisation and History: The Evolution of the Nineteenth-Century Atlantic Economy, Cambridge, Mass., MIT Press, 2000.
See John Coastworth and Alan Taylor, Latin America and the World Economy Since 1800, Cambridge, Mass., Harvard University Press, 1998.
See Michael A. Clemens and Jeffrey Williamson, “Wealth Bias in the First Global Capital Market Boom, 1870–1913,” Harvard University, Working Paper, July 2001 (unpublished).
See Laura Alfaro and Areedam Chanda, “FDI and Economic Growth: The Role of Local Financial Markets,” Harvard Business School and University of Houston, February 2001 (unpublished).
Lucio Sarno and Mark Taylor, “Hot Money, Accounting Labels and the Permanence of Capital Flows to Developing Countries: An Empirical Investigation,” Journal of Development Economics, 1999, vol. 59, no. 2, pp. 337–364.
Kenneth Froot, Paul O’Connell and Mark Seasholes, “The Portfolio Flows of International Investors,” Journal of Financial Economics, vol. 59, no. 2, February 2001, pp. 151–193
Woochan Kim, “Foreign Portfolio Investors Before and During a Crisis,”Journal of International Economics 56(1), 2002, pp. 77–96.
Robert Shiller, Irrational Exuberance, Princeton, Princeton University Press, 2000.
Graciela Kaminsky, Richard Lyons and Sergio Schmukler, “Managers, Investors and Crises: Mutual Fund Strategies in Emerging Markets,” World Bank Working Paper, 2399 and NBER Working Paper, 7855, 2000.
See Barry Eichengreen, Andrew Rose and Charles Wyplosz, “Contagious Currency Crises: First Tests,” Scandinavian Journal of Economics, vol. 98, no. 4, 1996, pp. 463–484.
See Manmohan Kumar and Avinash Penaud, “Pure Contagion and Investors’ Shifting Risk Appetite: Analytical Issues and Empirical Evidence,” IMF Working Paper, No. 134, September 2001.
See Guillermo Calvo and Enrique Mendoza, “Rational Contagion and the Globalization of Securities Markets,”Journal of International Economics vol. 51, no. 1, June 2000, pp. 79–113
for a discussion Gary Schinasi and Todd Smith, “Portfolio Diversification, Leverage, and Financial Contagion,” IMF Staff Papers, vol. 47, no. 2, 2001, pp. 159–176.
See Piti Disyatat and Gaston Gelos,“The Asset Allocation of Emerging Market Mutual Funds,” IMF Working Paper WP/01/111, August 2001.
Rodrigo da Fonseca, “Argentina in Numbers,” Buenos Aires, Banco de Galicia Research Department, October 2001.
See Albert Fishlow, “Lessons from the Past: Capital Markets During the 19th Century and the Interwar period,” International Organization, vol. 39, no. 3, 1985, pp. 383–439
for an analysis on the rescue packages by the time, involving a reduced number of private actors, see Albert Fishlow, “Conditionality and Willingness to Pay: Some Parallels from the 1890s,” in Barry Eichengreen and Peter H. Lindert, eds., The International Debt Crisis in Historical Perspective, Cambridge, Mass., MIT Press, 1989, pp. 86–105.
See Barry Eichengreen and Ashoka Mody, “What Explains Changing Spreads on Emerging Market Debt: Fundamentals or Market Sentiment?”, World Bank RMC Discussion Paper Series, No. 123, 1998.
Copyright information
© 2003 Javier Santiso
About this chapter
Cite this chapter
Santiso, J. (2003). Capital Flows to Emerging Markets: Goodbye the Golden 1990s?. In: The Political Economy of Emerging Markets. The CERI Series in International Relations and Political Economy. Palgrave Macmillan, New York. https://doi.org/10.1057/9781403973788_3
Download citation
DOI: https://doi.org/10.1057/9781403973788_3
Publisher Name: Palgrave Macmillan, New York
Print ISBN: 978-1-4039-6903-3
Online ISBN: 978-1-4039-7378-8
eBook Packages: Palgrave Political & Intern. Studies CollectionPolitical Science and International Studies (R0)