Capital flight to Germany: Two alternative measures

Autor(en): Cheung, Yin-Wong
Steinkamp, Sven
Westermann, Frank 
Stichwörter: AFRICA; BALANCES; Business & Economics; Business, Finance; CHINA; CORRUPTION; CURRENT ACCOUNT; DEBT; DETERMINANTS; Economic policy uncertainty; Flight-to-safety; Illicit capital flight; TARGET2; TARGET2 balance; TARIFF EVASION; TRADE; Trade misinvoicing
Erscheinungsdatum: 2020
Herausgeber: ELSEVIER SCI LTD
Journal: JOURNAL OF INTERNATIONAL MONEY AND FINANCE
Volumen: 102
Ausgabe: SI
Zusammenfassung: 
We use two measures to study two capital flight channels for Germany. One measure is based on the concept of trade misinvoicing and one on net claims and liabilities in the Eurosystem of central banks. For both measures, we propose refinements to enhance the assessment of capital flight. We find that capital flight towards Germany via these two channels has been quite sizable in the recent decade and can tally to about 2% of GDP annually. Regarding their determinants, we show that the two capital flight measures are driven by both common and measure-specific factors. Traditional determinants such as covered interest differentials only play a limited role, while crisis-specific factors such as economic policy uncertainty, the ECB collateral policy, as well as currency misalignment are driving factors of the investors' apparent flight-to-safety behavior. (C) 2019 Elsevier Ltd. All rights reserved.
ISSN: 02615606
DOI: 10.1016/j.jimonfin.2019.102095

Show full item record

Google ScholarTM

Check

Altmetric