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Uncertainty and episodes of extreme capital flows in the Euro Area
- Source :
- Economic Modelling. 48:343-356
- Publication Year :
- 2015
- Publisher :
- Elsevier BV, 2015.
-
Abstract
- During the Euro Area crisis contractions in international capital flows occurred along with a high level of economic uncertainty. While both factors are able to trigger or amplify economic shocks posing a threat for economic activity, it is a natural question whether they are related. The aim of this paper is to analyse the link between different measures of uncertainty and episodes of extreme capital flows for the EMU-12 countries using gross capital flows. We find that country-specific risk factors seem to play an important role in indicating periods of extreme capital flows. Moreover, country-specific uncertainty seems to be more relevant for foreign direct investors and for those in stressed countries of the Euro Area.
- Subjects :
- Economics and Econometrics
Capital flows
uncertainty
Euro Area crisis
sudden stops
retrenchment
business.industry
Economic uncertainty
Economic capital
jel:F32
jel:F21
International trade
Monetary economics
jel:G01
International capital
Economics
Retrenchment
business
Global risk
capital flows,uncertainty,Euro Area crisis,sudden stops,retrenchment
Subjects
Details
- ISSN :
- 02649993
- Volume :
- 48
- Database :
- OpenAIRE
- Journal :
- Economic Modelling
- Accession number :
- edsair.doi.dedup.....22ec3e7443b6e5c74527b835cd45ac76