Title: Capital mobility in commodity-exporting economies
Authors: Konstantin Rybak - RANEPA (Russia) [presenting]
Andrey Zubarev - Russian Presidential Academy of National Economy and Public Administration (Russia)
Andrey Polbin - Russian Presidential Academy of National Economy and Public Administration (Russia)
Abstract: Capital mobility is studied in commodity-exporting economies. These countries substantially depend on world commodity prices and have rather high level of savings on average, so it is naturally to assume that they demonstrate special patterns of capital mobility. The main hypothesis is that constraints on capital mobility in this group of countries depend upon the level of savings compared to the level of investments. In particular, with high savings that follow higher world demand and higher commodity prices, financing country's desirable level of investment is not a big deal. At the same time, in the case of negative terms of trade shocks these commodity-exporting economies may experience lower savings and higher country risk-premium. This may lead to restrictions on borrowing capital in the global market, resulting in a high correlation between investments and savings. The results of threshold regressions speak in favour of our hypothesis.