Capital flow deflection under the magnifying glass
利用新的季度数据集，研究发现一国收紧资本管制会促使资本流入其他类似借款经济体，这种偏转主要由组合投资和银行信贷驱动，且不同投资者反应不同。
Abstract Leveraging on a new quarterly dataset of capital control adjustments, we find renewed evidence that the introduction or tightening of capital controls in one economy increases capital inflows to other similar borrowing economies, an effect often called capital flow deflection. However, not all flows are deflected alike. Capital flow deflection is primarily driven by portfolio investment and bank credit, and only controls targeting these types of flows generate this externality. Moreover, analysing bilateral capital flows in order to capture investing countries' characteristics, we find that capital controls tend to deflect flows from advanced economies' portfolio equity investors, while controls on bank‐related flows primarily deflects lending from emerging market banks.