The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)

Detalhes bibliográficos
Autor(a) principal: Duran, H. E.
Data de Publicação: 2022
Outros Autores: Ferreira-Lopes, A.
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
Texto Completo: http://hdl.handle.net/10071/27164
Resumo: This study investigates the recent trend of the Feldstein-Horioka puzzle and the underlying reasons for moderation in capital flows. This issue is analysed quite inadequately for the period after the Global Financial Crisis, which represents a crucial turning point for economic climate and policies. The Feldstein-Horioka Puzzle is estimated using the World’s 13 largest economies, with panel GMM regression, between 1996 and 2016. We uncover that the Global Financial Crisis had a persistent detrimental effect on capital liberalization, after which the Feldstein-Horioka puzzle has revived and capital mobility has decreased. We suggest two possible explanations for such moderation in capital flows: the increasing risk perception and risk aversion behaviour of fund supplying countries, which increases the home bias, and capital controls against free flow of capital that have been applied after the Global Financial Crisis of 2008/2009.
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spelling The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)Capital mobilityFeldstein-Horioka PuzzlePanel GMMThis study investigates the recent trend of the Feldstein-Horioka puzzle and the underlying reasons for moderation in capital flows. This issue is analysed quite inadequately for the period after the Global Financial Crisis, which represents a crucial turning point for economic climate and policies. The Feldstein-Horioka Puzzle is estimated using the World’s 13 largest economies, with panel GMM regression, between 1996 and 2016. We uncover that the Global Financial Crisis had a persistent detrimental effect on capital liberalization, after which the Feldstein-Horioka puzzle has revived and capital mobility has decreased. We suggest two possible explanations for such moderation in capital flows: the increasing risk perception and risk aversion behaviour of fund supplying countries, which increases the home bias, and capital controls against free flow of capital that have been applied after the Global Financial Crisis of 2008/2009.Elsevier2024-11-23T00:00:00Z2022-01-01T00:00:00Z20222022-10-26T17:11:39Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10071/27164eng0275-531910.1016/j.ribaf.2021.101580Duran, H. E.Ferreira-Lopes, A.info:eu-repo/semantics/embargoedAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2023-11-09T17:58:44Zoai:repositorio.iscte-iul.pt:10071/27164Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-19T22:30:37.886973Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse
dc.title.none.fl_str_mv The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)
title The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)
spellingShingle The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)
Duran, H. E.
Capital mobility
Feldstein-Horioka Puzzle
Panel GMM
title_short The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)
title_full The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)
title_fullStr The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)
title_full_unstemmed The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)
title_sort The revival of the Feldstein-Horioka Puzzle and moderation of capital flows after the Global Financial Crisis (2008/09)
author Duran, H. E.
author_facet Duran, H. E.
Ferreira-Lopes, A.
author_role author
author2 Ferreira-Lopes, A.
author2_role author
dc.contributor.author.fl_str_mv Duran, H. E.
Ferreira-Lopes, A.
dc.subject.por.fl_str_mv Capital mobility
Feldstein-Horioka Puzzle
Panel GMM
topic Capital mobility
Feldstein-Horioka Puzzle
Panel GMM
description This study investigates the recent trend of the Feldstein-Horioka puzzle and the underlying reasons for moderation in capital flows. This issue is analysed quite inadequately for the period after the Global Financial Crisis, which represents a crucial turning point for economic climate and policies. The Feldstein-Horioka Puzzle is estimated using the World’s 13 largest economies, with panel GMM regression, between 1996 and 2016. We uncover that the Global Financial Crisis had a persistent detrimental effect on capital liberalization, after which the Feldstein-Horioka puzzle has revived and capital mobility has decreased. We suggest two possible explanations for such moderation in capital flows: the increasing risk perception and risk aversion behaviour of fund supplying countries, which increases the home bias, and capital controls against free flow of capital that have been applied after the Global Financial Crisis of 2008/2009.
publishDate 2022
dc.date.none.fl_str_mv 2022-01-01T00:00:00Z
2022
2022-10-26T17:11:39Z
2024-11-23T00:00:00Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv http://hdl.handle.net/10071/27164
url http://hdl.handle.net/10071/27164
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv 0275-5319
10.1016/j.ribaf.2021.101580
dc.rights.driver.fl_str_mv info:eu-repo/semantics/embargoedAccess
eu_rights_str_mv embargoedAccess
dc.format.none.fl_str_mv application/pdf
dc.publisher.none.fl_str_mv Elsevier
publisher.none.fl_str_mv Elsevier
dc.source.none.fl_str_mv reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação
instacron:RCAAP
instname_str Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação
instacron_str RCAAP
institution RCAAP
reponame_str Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
collection Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
repository.name.fl_str_mv Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação
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