Working Paper: NBER ID: w31599
Authors: Sergio Florez; Matteo Maggiori; Jesse Schreger; Ziwen Sun; Serdil Tinda
Abstract: We survey the literature on global capital allocation. We begin by reviewing the rise of cross-border investment, the shift towards portfolio investment, and the literature focusing on aggregate patterns in multilateral and bilateral positions. We then turn to the recent literature that uses micro-data to document patterns in global capital allocations. We focus on the importance of the currency of denomination of assets in international portfolios and the role that tax havens and offshore financial centers play in intermediating global capital. We conclude with directions for future research in this area.
Keywords: global capital allocation; cross-border investment; portfolio investment; tax havens; offshore financial centers
JEL Codes: F0; F3; F30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| cross-border investment dynamics (F21) | financial stability risks (F65) |
| shift towards portfolio investment (F21) | decline in bank lending (G21) |
| currency of denomination (E42) | investment decisions (G11) |
| tax havens (H26) | global capital flows (F32) |