scholarly journals Industrial Structure, Demographic Pattern, and Indonesian Current Account

2017 ◽  
Vol 19 (3) ◽  
Author(s):  
Ni Putu Wiwin Setyari ◽  
Ida Bagus Putu Purbadharmaja ◽  
Ni Luh Karmini
Keyword(s):  
Current Account ◽  
Capital Flows ◽  
Industrial Structure ◽  
Capital Intensity ◽  
Developed Countries ◽  
International Capital Flows ◽  
Current Account Balance ◽  
International Capital ◽  
Trade Theory ◽  
Capital Intensive

The new trade theory shows the interaction between capital intensity, reflects the comparative advantages of a country as well as the industrial structure, and international capital flows. One main proposition stated if a country has high capital intensity in their industrial structure, and changes tends to be capital intensive, foreign capital will flow into the country because the domestic savings position become lower than investment needs. It can explain why international capital flows from developing countries to the developed countries that are relatively rich in capital. This study attempted to examine the consistency and reliability of the theory in the context of Indonesia. The important thing here is the existence of different viewpoints in assessing the phenomenon of the current account balance. The model used is the restricted error correction mechanism in Autoregressive Distributed Lag (ECM-ARDL) approach. The result indicates that both industrial structure and demographic pattern are affecting Indonesian current account significantly. Specifically, capital intensity negatively affects Indonesian current account. This indicates the higher capital intensity, which means the greater tendency to capital-intensive industry structure, leads to higher current account deficit. The analysis also highlights the importance of demographic pattern in determines Indonesian current account through their impact to savings – investment position.

scholarly journals Industrial Capital Intensity and Comparative Advantages Dynamism of Indonesian Export Products

2015 ◽  
Vol 16 (2) ◽  
pp. 107
Author(s):  
Ni Putu Wiwin Setyari ◽  
Tri Widodo ◽  
Muhammad Edhie Purnawan
Keyword(s):  
Comparative Advantage ◽  
Capital Flows ◽  
Industrial Structure ◽  
Large Population ◽  
Capital Intensity ◽  
International Capital Flows ◽  
International Capital ◽  
Trade Theory ◽  
Marginal Rate ◽  
Capital Intensive

The development of new trade theory which incorporates the interaction between trade and international capital flows indicates if the possibility of changes in a country's comparative advantage due to the opening of international capital flows. International capi tal flows allow for changes in the industrial structure of a country depends on the composition of the products produced in that coun try. More capital-intensive types of products produced by a country, the greater the need for capital and the higher marginal rate of capital that can be given to attract greater international capital flows. Therefore, a comparative advantage should be seen as dynamic rather than static. As a country with large population, Indonesia tends to specialize in labor -intensive products. The other hand, efforts to attract foreign direct investment are very intensively conducted. The estimation results indicate if there was a shift in the pattern of industrial specialization Indonesia, from labor –intensive tends toward capital intensive.

Industrial Structure and Capital Flows

2012 ◽  
Vol 102 (5) ◽  
pp. 2111-2146 ◽  
Author(s):  
Keyu Jin
Keyword(s):  
Capital Flows ◽  
Industrial Structure ◽  
Developed Countries ◽  
Financial Capital ◽  
International Capital ◽  
Composition Effect ◽  
Financial Capital Flows ◽  
Current Account Imbalances ◽  
Capital Intensive ◽  
Developing And Developed Countries

This paper provides a new theory of international capital flows. In a framework that integrates factor-proportions-based trade and financial capital flows, a novel force emerges: capital tends to flow toward countries that become more specialized in capital-intensive industries. This “composition” effect competes with the standard force that channels capital toward the location where it is scarcer. If the composition effect dominates, capital flows away from the country hit by a positive labor force/productivity shock—a flow “reversal.'' Extended to a quantitative framework, the model generates sizable current account imbalances between developing and developed countries broadly consistent with the data. (JEL F14, F21, F32, F41, L16, O19)

scholarly journals The Impact of International Capital Flows on Jordan’s Economic Growth

2019 ◽  
pp. 214-220
Author(s):  
Basem M. Lozi ◽  
Mamoun Shakatreh
Keyword(s):  
Economic Growth ◽  
Capital Flows ◽  
Time Series Data ◽  
Developed Countries ◽  
International Capital Flows ◽  
Capital Inflows ◽  
Series Data ◽  
International Capital ◽  
The Government ◽  
The Impact

The aim of this study is to examine the impact of international capital flows on the economic growth in Jordan during the period from 2005 to 2017, The study also examines trends and composition of capital inflows. The study used descriptive analytical research method which was appropriate for the purpose of research. By using time series data, the study found that Foreign Direct Investment (FDI), foreign portfolio investment (FPI), grants (Gr) and Worker remittances (WR) are positively affecting the economic growth direct contribution. Based on the research results, the study came with a several recommendations, the most important recommendation is; the government of Jordan should create and relax the rules and regulations to attract more investors, and also the government should work hand in hand with the developed countries to create economic and employment opportunities, improve the country’s competitiveness, and expand growth within the private sector so that everyone in Jordan has the opportunity to contribute to a brighter future.

scholarly journals The Impact of International Capital Flows on Economic Growth in Palestine

2020 ◽  
pp. 23-37
Author(s):  
Nemer Badwan ◽  
Mohammed Atta
Keyword(s):  
Economic Growth ◽  
Capital Flows ◽  
Positive Impact ◽  
Developed Countries ◽  
International Capital Flows ◽  
Global Markets ◽  
International Capital ◽  
Financial Flows ◽  
The Government ◽  
The Impact

The study aims to investigate and examine the impact of International Capital Flows and other Financial Flows on Economic Growth in Palestine during the period (2007-2018). This study also included trends and methods of forming Capital Flows and Financial Capital Flows. The study used the appropriate descriptive and analytical approach by the authors for the purposes and requirements of the research to investigate the real results and required. The researchers used the time intervals method, and the study concluded that Foreign Direct Investment (FDI), Foreign Portfolio Investment (FPI), Large Loans (World Bank), Worker Remittances (WR), Foreign Affairs Borrowing and Financial Grants (GR) have a noticeable positive impact on Economic Growth in Palestine. The study made several important and useful recommendations, the most notably: That Palestinian Government must lay down and establish lighter and comfortable rules and regulations for investors to attract more investors and Foreign Investments to Palestine. Besides, the Palestinian Government must work hard side by side with the other Developed Countries for reaching better Economic Development and increasing a good rate. To achieve a good rate of Economic Growth, the government must work hard to create job opportunities for citizens to reduce the high Unemployment rate in the country. The Government should improve the standard of living and competitiveness in global markets and obtain a sufficient share in the International Financial Markets, so the Government must work to provide new opportunities for Global Markets Integration by creating a good environment to increase Economic Growth and Technology Development.

scholarly journals Current Trends in the Dynamics of International Capital Flows

2019 ◽  
Vol 12 (4) ◽  
pp. 46-56 ◽  
Author(s):  
M. Yu. Golovnin ◽  
S. A. Nikitina
Keyword(s):  
Capital Flows ◽  
Bank Lending ◽  
Developed Countries ◽  
International Capital Flows ◽  
Foreign Direct Investments ◽  
International Capital ◽  
Capital Movements ◽  
Current Trends ◽  
International Capital Movements ◽  
The Usa

Global economic and financial crisis 2007–2009 had a devastating effect on international capital flows. An assessment of their dynamics over the past decade shows that in certain fields (for example, the volume of international debt securities circulating) the pre-crisis indicators were exceeded, in a number of areas they are close to the pre-crisis level (foreign direct investments, total capitalization of the world stock market), international bank lending remains significantly behind the pre-crisis values. In the leading world economies cross-border capital flows relative to GDP significantly decreased compared to 2007. Global imbalances between savings and investments continued to grow, though their structure by countries changed, and now developed countries play a key role in them. In the structure of international capital flows the main shift occurred from the other to portfolio investment, with a slight increase in the role of direct investment. The “quantitative easing” policy in the USA and euro zone has had a significant impact on international capital flows. With generally positive trends in international capital movements in 2017–2018, new threats to their developments are beginning to emerge, primarily in countries with emerging markets.

Sign in / Sign up

Export Citation Format

Share Document