Saving, Investment, Financial Integration, and the Balance of Payments
40 Pages Posted: 15 Feb 2006
Date Written: December 14, 1989
This paper examines the extent of international financial integration, and its consequences for the current account. The evidence indicates that financial liberalization in the 1970s and 1980s has resulted in a substantial movement towards closer integration of world capital markets. By reducing constraints on international capital flows, this movement makes the current account more of a residual factor in agents` decisions.
JEL Classification: 423, 431, 441
Suggested Citation: Suggested Citation