IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/50273.html
   My bibliography  Save this paper

Capital Flight and Transfer from Resource-Rich Developing Countries

Author

Listed:
  • Demachi, Kazue

Abstract

This paper analyzes the influence of international resource price movements on capital outflows from resource-rich developing countries (RRDCs) by distinguishing capital flight and capital transfers. The volume of capital flight and transfers are calculated and their determinants are analyzed using macro-panel data constituting 21 resource-rich developing countries from 1990 to 2011. Through the regression analysis, the linkage between capital flight and resource revenue as well as that between capital flight and debt is suggested. The results of this analysis suggest the need to focus on capital outflow from RRDCs through transnational companies.

Suggested Citation

  • Demachi, Kazue, 2013. "Capital Flight and Transfer from Resource-Rich Developing Countries," MPRA Paper 50273, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:50273
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/50273/1/MPRA_paper_50273.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Michael P. Dooley, 1988. "Capital Flight: A Response to Differences in Financial Risks," IMF Staff Papers, Palgrave Macmillan, vol. 35(3), pages 422-436, September.
    2. Leonce Ndikumana & James Boyce, 2011. "Capital flight from sub-Saharan Africa: linkages with external borrowing and policy options," International Review of Applied Economics, Taylor & Francis Journals, vol. 25(2), pages 149-170.
    3. Luiz R. de Mello Jr., 1997. "Foreign Direct Investment in Developing Countries: A Selective Survey," Studies in Economics 9701, School of Economics, University of Kent.
    4. Dooley, Michael & Helkie, William & Tryon, Ralph & Underwood, John, 1986. "An analysis of external debt positions of eight developing countries through 1990," Journal of Development Economics, Elsevier, vol. 21(2), pages 283-318, May.
    5. Jeffrey D. Sachs & Andrew M. Warner, 1995. "Natural Resource Abundance and Economic Growth," NBER Working Papers 5398, National Bureau of Economic Research, Inc.
    6. Budina, Nina & Pang, Gaobo & van Wijnbergen, Sweder, 2007. "Nigeria's growth record : Dutch disease or debt overhang ?," Policy Research Working Paper Series 4256, The World Bank.
    7. Cuddington, John, 1989. "Commodity Export Booms in Developing Countries," The World Bank Research Observer, World Bank, vol. 4(2), pages 143-165, July.
    8. World Bank, 2011. "World Development Report 2011 [Rapport sur le développement dans le monde 2011 : Conflits, sécurité et développement - Abrégé]," World Bank Publications - Books, The World Bank Group, number 4389.
    9. repec:aer:wpaper:35 is not listed on IDEAS
    10. Elizabeth Asiedu, 2006. "Foreign Direct Investment in Africa: The Role of Natural Resources, Market Size, Government Policy, Institutions and Political Instability," The World Economy, Wiley Blackwell, vol. 29(1), pages 63-77, January.
    11. World Bank, 1993. "Global Economic Prospects and the Developing Countries 1993," World Bank Publications - Books, The World Bank Group, number 32388.
    12. Ajayi, S.I., 1995. "Capital Flight and External Debt in Nigeria," Papers 35, African Economic Research Consortium.
    13. kant, C., 1996. "Foreign Direct Investment and Capital Flight," Princeton Studies in International Economics 80, International Economics Section, Departement of Economics Princeton University,.
    14. Sandra T. Barnes, 2005. "Global flows: Terror, oil & strategic philanthropy," Review of African Political Economy, Taylor & Francis Journals, vol. 32(104-105), pages 235-252, June.
    15. Corden, W Max & Neary, J Peter, 1982. "Booming Sector and De-Industrialisation in a Small Open Economy," Economic Journal, Royal Economic Society, vol. 92(368), pages 825-848, December.
    16. J. K. Boyce & L. Ndikumana, 2001. "Is Africa a Net Creditor? New Estimates of Capital Flight from Severely Indebted Sub-Saharan African Countries, 1970-96," Journal of Development Studies, Taylor & Francis Journals, vol. 38(2), pages 27-56.
    17. Boyce, James K., 1992. "The revolving door? External debt and capital flight: A Philippine case study," World Development, Elsevier, vol. 20(3), pages 335-349, March.
    18. Corden, W M, 1984. "Booming Sector and Dutch Disease Economics: Survey and Consolidation," Oxford Economic Papers, Oxford University Press, vol. 36(3), pages 359-380, November.
    19. World Economic Forum & World Bank & African Development Bank, 2011. "The Africa Competitiveness Report 2011," World Bank Publications - Books, The World Bank Group, number 2319.
    20. Otusanya, Olatunde Julius, 2011. "The role of multinational companies in tax evasion and tax avoidance: The case of Nigeria," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 22(3), pages 316-332.
    21. Luiz de Mello, 1997. "Foreign direct investment in developing countries and growth: A selective survey," Journal of Development Studies, Taylor & Francis Journals, vol. 34(1), pages 1-34.
    22. Avery, Robert B, 1977. "Error Components and Seemingly Unrelated Regressions," Econometrica, Econometric Society, vol. 45(1), pages 199-209, January.
    23. Cuddington, John T., 1987. "Capital flight ," European Economic Review, Elsevier, vol. 31(1-2), pages 382-388.
    24. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
    25. Sachs, Jeffrey D. & Warner, Andrew M., 2001. "The curse of natural resources," European Economic Review, Elsevier, vol. 45(4-6), pages 827-838, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kazue Demachi, 2014. "Capital flight from resource rich developing countries," Economics Bulletin, AccessEcon, vol. 34(2), pages 734-744.
    2. Yin‐Wong Cheung & XingWang Qian, 2010. "Capital Flight: China's Experience," Review of Development Economics, Wiley Blackwell, vol. 14(2), pages 227-247, May.
    3. Hajer Dachraoui & Mounir Smida & Maamar Sebri, 2020. "Role of capital flight as a driver of sovereign bond spreads in Latin American countries," International Economics, CEPII research center, issue 162, pages 15-33.
    4. Sebri, Maamar & Dachraoui, Hajer, 2020. "Resources bless BRICS," MPRA Paper 100423, University Library of Munich, Germany.
    5. Hajer Dachraoui & Maamar Sebri & Mahmoud M. A. Dwedar, 2021. "Natural Resources and Illicit Financial Flows from BRICS Countries," Biophysical Economics and Resource Quality, Springer, vol. 6(1), pages 1-13, March.
    6. Ben-Salha, Ousama & Dachraoui, Hajer & Sebri, Maamar, 2021. "Natural resource rents and economic growth in the top resource-abundant countries: A PMG estimation," Resources Policy, Elsevier, vol. 74(C).
    7. Cheung, Yin-Wong & Steinkamp, Sven & Westermann, Frank, 2016. "China's capital flight: Pre- and post-crisis experiences," Journal of International Money and Finance, Elsevier, vol. 66(C), pages 88-112.
    8. Leonce Ndikumana & Mare Sarr, 2019. "Capital Flight, Foreign Direct Investment and Natural Resources in Africa," UMASS Amherst Economics Working Papers 2019-12, University of Massachusetts Amherst, Department of Economics.
    9. Ndikumana, Léonce & Sarr, Mare, 2019. "Capital flight, foreign direct investment and natural resources in Africa," Resources Policy, Elsevier, vol. 63(C), pages 1-1.
    10. Léonce Ndikumana & Mare Sarr, 2016. "Capital flight and foreign direct investment in Africa: An investigation of the role of natural resource endowment," WIDER Working Paper Series wp-2016-58, World Institute for Development Economic Research (UNU-WIDER).
    11. Tiba, Sofien & Frikha, Mohamed, 2019. "The controversy of the resource curse and the environment in the SDGs background: The African context," Resources Policy, Elsevier, vol. 62(C), pages 437-452.
    12. Léonce Ndikumana & Mare Sarr, 2016. "Capital flight and foreign direct investment in Africa: An investigation of the role of natural resource endowment," WIDER Working Paper Series 058, World Institute for Development Economic Research (UNU-WIDER).
    13. Davis, Graham A., 2010. "Trade in mineral resources," WTO Staff Working Papers ERSD-2010-01, World Trade Organization (WTO), Economic Research and Statistics Division.
    14. Demachi, Kazue, 2012. "The effect of crude oil price change and volatility on Nigerian economy," MPRA Paper 41413, University Library of Munich, Germany.
    15. Stuart John Barton, 2016. "Policy Signals and Market Responses," Palgrave Studies in the History of Finance, Palgrave Macmillan, number 978-1-137-39098-1, December.
    16. Niels Hermes & Robert Lensink & Victor Murinde, 2002. "Flight Capital and its Reversal for Development Financing," WIDER Working Paper Series DP2002-99, World Institute for Development Economic Research (UNU-WIDER).
    17. Li, Zhiyuan & Doğan, Buhari & Ghosh, Sudeshna & Chen, Wei-Ming & Lorente, Daniel Balsalobre, 2024. "Economic complexity, natural resources and economic progress in the era of sustainable development: Findings in the context of resource deployment challenges," Resources Policy, Elsevier, vol. 88(C).
    18. Leonce Ndikumana & Mare Sarr, 2016. "Capital Flight and Foreign Direct Investment in Africa: An Investigation of the Role of Natural Resource Endowment," SALDRU Working Papers 167, Southern Africa Labour and Development Research Unit, University of Cape Town.
    19. Seung-Gwang Baek & Doo Yong Yang, 2010. "Institutional Quality, Captal Flight and Capital Flows," Korean Economic Review, Korean Economic Association, vol. 26, pages 121-155.
    20. Dachraoui, Hajer & Sebri, Maamar, 2020. "Tunisia, natural resources, and capital flight," EconStor Preprints 218970, ZBW - Leibniz Information Centre for Economics.

    More about this item

    Keywords

    Africa; Asia; capital flight; resource rich developing countries;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:50273. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.