NBER

Indrit Hoxha

University of Houston
Department of Economics
Houston, TX 77204
Tel: 832-573-4170

E-Mail: EmailAddress: hidden: you can email any NBER-related person as first underscore last at nber dot org
Institutional Affiliation: University of Houston

NBER Working Papers and Publications

January 2009How Big are the Gains from International Financial Integration?
with Sebnem Kalemli-Ozcan, Dietrich Vollrath: w14636
The literature has shown that the implied welfare gains from international financial integration are very small. We revisit the existing findings and document that welfare gains can be substantial if capital goods are not perfect substitutes. We use a model of optimal savings that includes a production function where the elasticity of substitution between capital varieties is less then infinity, but more than the value that would generate endogenous growth. This production structure is consistent with empirical estimates of the actual elasticity of substitution between capital types, as well as with the relatively slow speed of convergence documented in the growth literature. Calibrating the model, our results are that welfare gains from financial integration are equivalent to a 9% increas...

Published: Hoxha, Indrit & Kalemli-Ozcan, Sebnem & Vollrath, Dietrich, 2013. "How big are the gains from international financial integration?," Journal of Development Economics, Elsevier, vol. 103(C), pages 90-98. citation courtesy of

National Bureau of Economic Research
1050 Massachusetts Ave.
Cambridge, MA 02138
617-868-3900
info@nber.org

Twitter RSS

View Full Site: One timeAlways