Replication data for: Bad Investments and Missed Opportunities? Postwar Capital Flows to Asia and Latin America

Principal Investigator(s): View help for Principal Investigator(s) Lee E. Ohanian; Paulina Restrepo-Echavarria; Mark L. J. Wright

Version: View help for Version V1

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Project Citation:

Ohanian, Lee E., Restrepo-Echavarria, Paulina, and Wright, Mark L. J. Replication data for: Bad Investments and Missed Opportunities? Postwar Capital Flows to Asia and Latin America. Nashville, TN: American Economic Association [publisher], 2018. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113106V1

Project Description

Summary: After World War II, international capital flowed into slow-growing Latin America rather than fast-growing Asia. This is surprising as, everything else equal, fast growth should imply high capital returns. This paper develops a capital flow accounting framework to quantify the role of different factor market distortions in producing these patterns. Surprisingly, we find that distortions in labor markets, rather than domestic or international capital markets, account for the bulk of these flows. Labor market distortions that indirectly depress investment incentives by lowering equilibrium labor supply explain two-thirds of observed flows, while improvement in these distortions over time accounts for much of Asia's rapid growth.

Scope of Project

Subject Terms: Employment; Population; National Income and Product Accounts; Hours Worked

JEL Classification:
      E22 Investment; Capital; Intangible Capital; Capacity
      E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
      E32 Business Fluctuations; Cycles
      F21 International Investment; Long-term Capital Movements
      F32 Current Account Adjustment; Short-term Capital Movements
      O16 Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
      O47 Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

Geographic Coverage: Singapore, Hong Kong, United States, Portugal, Iceland, Greece, Netherlands, South Korea, Sweden, Austria, Luxembourg, Ireland, Brazil, France, Chile, Colombia, Argentina, Japan, United Kingdom, Switzerland, Spain, New Zealand, Canada, Belgium, Norway, Taiwan, Finland, Denmark, Italy, Mexico, Australia, Peru, Germany

Time Period(s): 1950 – 2007

Universe: National Economies

Data Type(s): program source code; aggregate data

Methodology

Data Source: Data sources are described in detail in the Appendix to the published paper.

Unit(s) of Observation: Country,

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V1 [2019-10-12]

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