Are global imbalances due to financial underdevelopment in emerging economies?

This Economic Letter presents recent research on a new explanation for both the export of savings and the import of equity by emerging countries: their level of underdevelopment of the financial sector compared to that of more advanced countries. Specifically, financial underdevelopment in emerging markets can lead to both over saving by domestic agents and undervaluation of domestic firms, which encourages international investors to purchase equity there.

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Year of publication:	2008
Authors:	Valderrama, Diego
Published in:	FRBSF Economic Letter. - Federal Reserve Bank of San Francisco. - 2008, 12
Publisher:	Federal Reserve Bank of San Francisco
Subject:	Balance of payments \| Capital movements \| International finance

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Extent:	text/html application/pdf
Type of publication:	Article
Language:	English
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005707356