How Common are Capital Flows Surges? How They are Measured Matters -a Lot

摘要

In recent years there have been a number of highly publicized episodes of large international capital flow surges and dramatic reversals. This paper addresses several issues surrounding such episodes. We investigate how frequent are capital surges and have they been increasing over time. This requires dealing with the issue of how capital flow surges are measured. In our review of recent studies we found that a wide variety of measures have been used and that most studies have paid little attention to the measures used in other studies. To examine how much the identification of surge episodes varied according to the different measures, we selected seven measures from the recent literature and applied them on a common dataset of 46 countries for the period 1980 to 2010. The differences in the numbers of episodes identified by the various methods were far from trivial. In fact they varied by a factor of almost three. However, across most measures, we found that there was a substantial increase in surges from the 1980s period to 1990s. Whether there was a further increase during the 2000s varied by the measure used. These findings highlight a need to devote more attention to how surges may best be measured.