Work detail

Beyond Global Imbalances: Gross capital flows and the role of Shadow Banking

Author: Mgr. Tomáš Václavíček
Year: 2017 - summer
Leaders: prof. PhDr. Petr Teplý Ph.D.
Work type: Finance, Financial Markets and Banking
Language: English
Pages: 103
Awards and prizes:
Abstract: This study provides an empirical analysis of Shadow banking as a factor influencing crossborder
financial flows. It builds upon emerging literature on Shadow banking and empirical
literature on global imbalances and global financial flows. The aim of the thesis is to test three
hypotheses, which relate global financial flows to lending, change in cross-border bank
liabilities, and shadow banking, respectively. The second and third hypotheses are tested on
gross capital flows, which, in contrast to net flows, better reflect financing activities. The results
suggest that Shadow banking activities are related to higher gross capital flows in periods, when
this sector is growing. These flows, however, tend to dry up when Shadow banking activities
level off or decline. Among other important factors is the output growth differential and global
risk aversion.




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