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International Effects on the U.S. Capital Market

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  • David G. Hartman

Abstract

This paper presents evidence bearing on the question of international influences on the U.S. capital market. Both the examination of relative magnitudes of international asset holdings and the estimation of a simple partial-equilibrium capital market model indicate that such influences are potentially quite important. In particular, we find that the effects on international flows on the long-term new-issue corporate bond rate in the U.S. are highly significant. Since this interest rate is often seen as crucial in domestic investment decisions, the paper provides reason to believe that investment in the U.S. is significantly influenced by international capital transactions.

Suggested Citation

  • David G. Hartman, 1980. "International Effects on the U.S. Capital Market," NBER Working Papers 0581, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:0581
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    References listed on IDEAS

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    1. Feldstein, Martin S & Chamberlain, Gary, 1973. "Multimarket Expectations and the Rate of Interest," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 5(4), pages 873-902, November.
    2. Benjamin M. Friedman, 1980. "The Effect of Shifting Wealth Ownership on the Term Structure of Interest Rates," NBER Working Papers 0239, National Bureau of Economic Research, Inc.
    3. Friedman, Benjamin Morton, 1977. "Financial Flow Variables and the Short-Run Determination of Long-Term Interest Rates," Scholarly Articles 4554309, Harvard University Department of Economics.
    4. Benjamin M. Friedman, 1980. "The Effect of Shifting Wealth Ownership on the Term Structure of Interest Rates: The Case of Pensions," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 94(3), pages 567-590.
    5. Friedman, Benjamin M, 1979. "Substitution and Expectation Effects on Long-Term Borrowing Behavior and Long-Term Interest Rates," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 11(2), pages 131-150, May.
    6. Friedman, Benjamin M, 1977. "Financial Flow Variables and the Short-Run Determination of Long-Term Interest Rates," Journal of Political Economy, University of Chicago Press, vol. 85(4), pages 661-689, August.
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    Cited by:

    1. Martin Feldstein, 1991. "Domestic Saving and International Capital Movements in the Long Run and the Short Run," NBER Chapters, in: International Volatility and Economic Growth: The First Ten Years of The International Seminar on Macroeconomics, pages 331-353, National Bureau of Economic Research, Inc.

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