Country Portfolios

44 Pages Posted: 29 Oct 2004

See all articles by Aart Kraay

Aart Kraay

World Bank - Development Research Group (DECRG)

Norman Loayza

World Bank - Research Department

Luis Servén

World Bank - Development Research Group (DECRG)

Jaume Ventura

Universitat Pompeu Fabra - Centre de Recerca en Economia Internacional (CREI); Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: May 2004

Abstract

Capital flows to developing countries are small and mostly take the form of loans rather than direct foreign investment. Kraay, Loayza, and Serven build a simple model of North-South capital flows that highlights the interplay between diminishing returns, production risk, and sovereign risk. The model generates a set of country portfolios and a world distribution of capital stocks that resemble those in the data.

This paper - a product of Investment Climate, Development Research Group - is part of a larger effort in the group to study international capital flows.

JEL Classification: F32, F34

Suggested Citation

Kraay, Aart and Loayza, Norman and Servén, Luis and Ventura, Jaume, Country Portfolios (May 2004). MIT Dept. of Economics Working Paper No. 00-16; World Bank Policy Research Working Paper No. 3320. Available at SSRN: https://ssrn.com/abstract=237553 or http://dx.doi.org/10.2139/ssrn.237553

Aart Kraay (Contact Author)

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States
202-473-5756 (Phone)
202-522-3518 (Fax)

HOME PAGE: http://econ.worldbank.org/staff/akraay

Norman Loayza

World Bank - Research Department ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

Luis Servén

World Bank - Development Research Group (DECRG)

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

Jaume Ventura

Universitat Pompeu Fabra - Centre de Recerca en Economia Internacional (CREI) ( email )

Ramon Trias Fargas, 25-27
Barcelona, 08005
Spain

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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