Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/90556
Authors: 
Hashimoto, Yuko
Wacker, Konstantin M.
Year of Publication: 
2012
Series/Report no.: 
Courant Research Centre: Poverty, Equity and Growth - Discussion Papers 124
Abstract: 
In this paper, we investigate whether better information about the macroeconomic environment of an economy has a positive impact on its capital inflows, namely portfolio and foreign direct investment (FDI). The purpose of our study is to explicitly quantify information asymmetries by compliance with the IMF's Special Data Dissemination Standard (SDDS). For FDI, we fi nd statistically signi cant and robust support for this hypothesis: SDDS subscription increased inflows by an economically relevant magnitude of about 60 percent. We also find evidence of aversion against political and macroeconomic risk as determinants of portfolio and FDI flows and use a non-parametric test for spatial correlation in the residuals of capital flows.
Subjects: 
determinants of capital flows
information
panel data
risk
SDDS
IMF
FDI
portfolio investment
spatial econometrics
JEL: 
C33
F21
G14
Document Type: 
Working Paper

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