skip to content

Faculty of Economics

Journal Cover

Alves, C. and Toporowski, J.

Growth of International Finance and Emerging Economies: Elements for an Alternative Approach

PSL Quarterly Review

Vol. 72 no. 288 (2019)

Abstract: This paper examines the increasing cross-border flows of capital involving developing and emerging economies in the past few decades. The discussion challenges the traditional economic theories based on net capital flows and deficits in current accounts to explain international borrowing by developing countries, and on the current account imbalances approach to explain financial crises. We argue that the increasing involvement of the private sector in developing countries’ external debt and the fact that the public sector, previously reliant almost entirely on official credit, has become able to access private debt markets, reflect the increasing integration of developing countries into the global financial system, and this process has particular features. A closer look at data on gross capital flows reveals that net capital flows neither explain nor capture this global financial integration.

Keywords: developing and emerging economies, private non-guaranteed (PNG) external debt, cross-border flows, financial globalisation

JEL Codes: F30, F60, G10, G30, H60

Author links: Carolina Alves  

Publisher's Link: https://doi.org/10.13133/2037-3643_72.288_1



Cambridge Working Paper in Economics Version of Paper: Growth of international finance and emerging economies: Elements for alternative approach, Alves, C. and Toporowski, J., (2019)

Papers and Publications



Recent Publications


Ambrus, A. and Elliott, M. Investments in Social Ties, Risk Sharing, and Inequality Review of Economic Studies [2021]

Carvalho, V. M. and Grassi, B. Large Firm Dynamics and the Business Cycle American Economic Review [2019]

Aidt, T. S., Albornoz, F. and Hauk, E. Foreign Influence and Domestic Policy Journal of Economic Literature [2021]

Li, S. and Linton, O. When Will the Covid-19 Pandemic Peak? Journal of Econometrics [2021]