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The Elusive Gains from International Financial Integration, Pierre-Olivier Gourinchas, Olivier Jeanne

Contributor
Abstract
Standard theoretical arguments tell us that countries with relatively little capital benefit from financial integration as foreign capital flows in and speeds up the process of income convergence. We show in a calibrated neoclassical model that conventionally measured welfare gains from this type of convergence appear relatively limited for developing countries. The welfare gain from switching from financial autarky to perfect capital mobility is roughly equivalent to a 1 percent permanent increase in domestic consumption for the typical non-OECD country. This is negligible relative to the welfare gain from a take-off in domestic productivity of the magnitude observed in some of these countries
Table Of Contents
""Contents""; ""I. INTRODUCTION""; ""II. A SIMPLE EXPERIMENT""; ""A. The Model""; ""B. Calibration and Results""; ""C. Intuition""; ""D. Robustness""; ""III. EXTENDING THE BASIC MODEL""; ""A. Model""; ""B. Calibration and Results""; ""C. Is It Large? Some Comparisons""; ""D. Prosperity and Capital Mobility: Development Accounting""; ""IV. CONCLUSION""; ""THE MODEL WITH HUMAN CAPITAL""; ""A. Assumptions""; ""B. Steady State""; ""C. Financial Autarky""; ""D. Financial Integration""; ""E. Welfare Gains""; ""F. Marginal Welfare Gains""; ""G. Development Accounting""; ""CALIBRATING THE MODEL""
Language
eng
Literary Form
non fiction
Note
Description based upon print version of record
Physical Description
1 online resource (47 p.)
Specific Material Designation
remote
Form Of Item
online
Isbn
9781462335862

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