Bank of Korea research tots up damage from capital flows
Researchers find impact on growth and volatility
Researchers from the Bank of Korea seek to identify the extent to which financial shocks caused by cross-border capital flows translate into damage to the real economy in a working paper published today (July 28) by the central bank.
Costs of Foreign Capital Flows in Emerging Market Economies by Kyoungsoo Yoon and Jayoung Kim introduces the concept of "GDP growth surprises", measured as the difference between the expected and actual rates of growth.
The authors find increases in foreign direct
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