This study employs bilateral data on external assets to examine the impact of climate policies on the reallocation of international capital. We find that the stringency of climate policy in the destination country is significantly and positively associated with an increase in the allocation of...

Countries choose diverse policy mixes of macroprudential and capital flow management measures, yet the drivers behind these policy choices remain largely unexplored. We identify potential conditions for the adoption and determinants of the use of macroprudential and capital flow management...

The period after the Global Financial Crisis (GFC) was characterized by a considerable risk migration within global liquidity flows, away from cross-border bank lending towards international bond issuance. We show that the post-GFC shifts in the risk sensitivities of global liquidity flows are...

Purpose - This paper aims to obtain a recent estimate of the cost of precautionary foreign reserve accumulation that emerging market and developing economies (EMDEs) had to endure to protect themselves against the risks of financial globalization. In addition, the study estimates the cost of...

The European Union needs a single market for capital. Well-developed and integrated capital markets are necessary to support economic growth and resilience across the region, while offering benefits for businesses, households and financial stability. This paper examines the importance of the CMU...

We study the implications of deviations from covered interest rate parity for international capital flows using novel data covering euro-area derivatives and securities holdings. Consistent with a dynamic model of currency risk hedging, we document that investors' holdings of USD bonds decrease...

Purpose - This paper aims to discuss the main characteristics of the Middle East North Africa (MENA) region's capital inflows volatility. It also examines the effect of institutional quality and information availability on capital inflows volatility in selected MENA countries (Bahrain, Egypt,...

The current geopolitical landscape has made domestic resource mobilization an even more important imperative for developing countries. In this context, it is more urgent than ever to combat illicit financial flows (IFFs) whose staggering amount from developing countries has...

The rise in the volume of Illicit Financial Flows (IFFs) across the world is triggering calls from the Global South to mitigate the deleterious consequences of both IFFs and tax abuse on their economies. Using a Third World Approaches to International Law lens, this article analyses the politics...

A new mathematical structural model of the exchange rate and a new nonlinear multifactorial dependence of the exchange rate dynamics on a wide system of fundamental economic factors are the main results of the work. The model includes a wide system of economic factors based on the balance of...

The European Union's economic resilience continues to be tested by a volatile global The European Union's economic resilience continues to be tested by a volatile global environment. While inflationary pressures have eased and monetary policies have begun to stabilise, interest rates remain...

The European Union's economic resilience continues to be tested by a volatile global environment. While inflationary pressures have eased and monetary policies have stabilised, escalating geopolitical tensions and rising protectionism are creating significant uncertainties for growth and...

We study the implications of deviations from covered interest rate parity for international capital flows using novel data covering euro-area derivatives and securities holdings. Consistent with a dynamic model of currency risk hedging, we document that investors' holdings of USD bonds decrease...

This paper provides novel microlevel evidence that cross-border bank flows are an important means for households to access credit, not only in emerging markets but also in advanced economies. Using supervisory bank-level data alongside household credit and consumption data from Germany, we study...

The global non-bank sector has experienced significant growth since the global financial crisis, raising concerns that this shift represents a financial stability risk. We consider the drivers of this growth in Sweden: a small, open economy whose non-bank sector has grown rapidly. In contrast...

We use a dynamic spatial general equilibrium model of international investment and production to investigate the real implications of the last five decades of financial globalization. We introduce a wedge accounting framework to estimate country- and time-varying measures of outward and inward...

This paper investigates the impact of repatriated export proceeds on exchange rate volatility in Indonesia. By applying a time-varying parameter vector autoregression (TVP-VAR) model with stochastic volatility, we assess whether the impact of repatriated export proceeds can dampen the effect of...

Europe faces massive investment needs: it must regain competitiveness, provide stability to its ageing population, and confront climate change and external threats. This has renewed the urgency of the decade-old European Union (EU) project for a capital markets union (CMU). CMU is a cornerstone...

This paper contributes to the existing literature on exchange rate modelling by developing a new proxy for foreign exchange market imbalances. By utilizing the monetary presentation of the Balance of Payments we create a measure of net external flows and study its impact on the exchange rate....