INSTITUTIONAL QUALITY AND NET CAPITAL FLOW EPISODES: EVIDENCE FROM DEVELOPING ECONOMIES
Journal: Advance Journal of Econometrics and Finance
Year: 2025

Using local projections regression, we investigate the role of institutional quality in establishing the influence of the surge, stop, flight, and retrenchment on the real sector indicators such as GDP growth rate, employment, and savings. In this study we consider 47 developing economies from 1980–2018. We construct an institutional quality index differentiating between high-institutional and low-institutional quality. We find that both the liability flow-driven episode surges and asset flow-dr