Trade in Financial Services and Capital Movements

July 1, 1999

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Format: Chicago

Natalia T. Tamirisa Trade in Financial Services and Capital Movements, (USA: International Monetary Fund, 1999) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

International financial liberalization may alter saving-investment imbalances and patterns of capital flows across countries. In a panel of OECD countries for 1990–96, this study examines how the liberalization of capital movements and financial services trade affects net private capital flows. Capital inflows tend to fall (rise) with the liberalization of commercial presence in banking and securities (insurance) services, possibly reflecting an increase (decrease) in saving. Capital account liberalization is found to stimulate capital inflows, suggesting that better access to external financing helps sustain larger fiscal and current account deficits. When cross-border trade is liberalized, capital flows change insignificantly.

Subject: Balance of payments, Capital controls, Capital flows, Capital inflows, Financial services, International trade, Trade in services

Keywords: A. capital movement, Capital, Capital constraint, Capital controls, Capital flow, Capital flows, Capital inflows, Capital mobility, Financial service, Financial service service sector, Financial service supplier, Liberalization, Market discipline, Market equilibrium, Market participant, Net capital flow, Saving-investment gap, Saving-investment imbalance, Trade in financial services, Trade in services, WP

Publication Details

Pages:

22
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1999/089
Stock No:

WPIEA0891999
ISBN:

9781451851267
ISSN:

1018-5941

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