Suchergebnisse

Why is it that when an American puts money abroad it is called "foreign investment" and when an Argentinean does the same it is called "capital flight"? Why is it when an American company puts 30% of its equity abroad it is called "strategic diversification" and when a Bolivian businessman puts only 4% abroad it is called "lack of confidence"?— Stephen C. Kanitz (1984)Despite the Great difficulty in separating "good" international diversification from "bad" capital flight, the size and variance of these capital exports from developing countries have become a matter of increasing concern. According to some analysts, this capital flight has contributed to the sharp increase in foreign debt of developing countries, undermined the tax base, and — in extreme cases — even resulted in a net real capital transfer out of the country (Khan and Ul-Haque, 1985). This perception that capital flight might be undermining development efforts has led to a series of studies which have attempted to estimate the volume of capital flight. The best summary of this work is the conference proceedings edited by Lessard and Williamson (1987).

According to the author, despite the great difficulty in separating international diversification from capital flight, the size and variance of these capital exports from developing countries have become a matter of increasing concern. Using two different methods, the author attempts to measure Colombian capital flight and drug trade and discusses adjustments to the established patterns and estimates

There exists no generally accepted definition of the term "capital flight". For the purpose of this article capital flight refers to Illegal capital flight, also known as illicit financial flows, which disappear from any record in the country of origin. Moreover earnings on the stock of illegal capital flight outside of a country generally do not return to the country of origin. In this regard, capital flight is creating a serious development challenges for most African economies. Ethiopia is not exceptional for this impact. The analysis of this article led to two major findings. First, African countries have become increasingly indebted; they experienced large scale capital flight. According to studies a group of 33 SSA (Sub- Saharan Africa) countries has lost a total of $814 billion dollars from 1970 to 2010. This exceeds the amount of official development aid ($659 billion) and foreign direct investment ($306 billion) received by these countries. Oil-rich countries account for 72 percent of the total capital flight from the sub region ($591 billion). Secondly, an upcoming report by Global Financial Integrity 2009, finds that Ethiopia, which has a per-capita GDP of just US$365, lost US$11.7 billion to illicit financial outflows between 2000 and 2009. In 2009, illicit money leaving the economy totaled US$3.26 billion, which is double the amount in each of the two previous years. In conclusion, currently the impact of capital flight for Ethiopia economy is becoming very severe. So, Ethiopian government effort to promoting economic development must be go hand in hand with fighting capital flight

We study the empirical determinants of China's capital flight. In addition to the covered interest differential, our empirical exercise includes a rather exhaustive list of macroeconomic variables and a few institutional factors. Overall, our regression exercise shows that China's capital flight is quite well explained by its own history and covered interest differentials. The other possible determinants offer relatively small additional explanatory power. It is also found that China's capital flight responds differently to the components of covered interest differentials and to the positive and negative components of these variables. The response pattern, however, depends on the choice of data frequency. The general impression is that the monthly results are more intuitive than the quarterly ones.

Capital flight first gained prominence in the early eighties when many Latin American countries were faced with the prospect of defaulting on their debts to foreign commercial banks. The popular press in Bangladesh regularly reports about the flight of capital from this country. However, there has not been any attempt to quantify the extent of capital flight from Bangladesh. The authors survey, scrutinize and use the various definitions of capital flight to get some estimates of the extent of capital flight from Bangladesh, to describe the causes of capital flight and some of its mechanisms, and to do preliminary econometric analysis of the phenomenon. (DÜI-Sen)

Capital flight often amounts to a substantial proportion of GDP when developing countries face crises. This paper presents a portfolio choice model that relates capital flight to rate of return differentials, risk aversion, and three types of risk: financial risk, political risk, and policy risk. Estimating the equilibrium capital flight equation for a panel of 47 developing countries over 16 years, we show that all three types of risk have a statistically significant impact on capital flight. Quantitatively, political risk is the most important factor causing capital flight. We also identify several political factors that reduce capital flight by signaling market-oriented reforms are imminent.