会议专题

Does Money Follow the Flag?

We examine whether bilateral political relations can explain investment and trade flows between the United States and other countries. We treat political relations as endogenous using instrumental variable analysis and investigate whether an exogenous shock to political relations, the 2003 war in Iraq, leads to a shift in economic flows. The results suggest that a deterioration in bilateral relations is followed by a significant decrease in economic flows between the United States and that country. These results are robust to country fixed effects, income, industry growth, financial market development, and risk.

international capital flows foreign portfolio investment political relations

Nandini Gupta Xiaoyun Yu

Kelley School of Business, Indiana University

国际会议

2009年中国金融国际年会

广州

英文

1-33

2009-07-07(万方平台首次上网日期,不代表论文的发表时间)