Determinants of Capital Flow Volatility in Developing Countries

Authors

  • Erhan Çetinkaya İSTANBUL TİCARET ÜNİVERSİTESİ
  • Serkan Çankaya

Abstract

Globalisation made capital to move easily between countries. Although capital flows help economies grow, large amounts of flows causes abrupt macroeconomic changes and threatens the financial stability. This study; uses quarterly data between 1980 and 2020 for 33 developing countries to measure the volatility of capital flow components (foreign direct investment, portfolio, other and total) in 3 different ways and uses panel data regression to look for the determinants of capital flow volatility. Results show that the push factors which are related with the global financial conditions are very effective on capital flow volatility. Among the pull factors, financial development index of IMF and the inflation rate of the country are effective.

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Published

2022-10-22

How to Cite

Çetinkaya, E., & Çankaya, S. (2022). Determinants of Capital Flow Volatility in Developing Countries. Journal of Financial Economics and Banking, 3(2), 21-32. Retrieved from http://jofeb.org/index.php/jofeb/article/view/33

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Full Length Articles