Growth and Capital Flows with Risky Entrepreneurship

• 成果类型: Article
• 署名作者: Sandri, Damiano
• 署名单位: International Monetary Fund
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.6.3.102
• 发表日期: 2014
• 页码: 102-123
• 关键词: lifetime portfolio selection; habit formation; INVESTMENT; MODEL; panel

摘要

We show that the behavior of entrepreneurs facing incomplete financial markets and risky investment can explain why accelerations of productivity growth in developing countries tend to be associated with current account improvements. Under uninsurable investment risk, entrepreneurs have to largely rely on self-financing so that, when productivity growth rises, entrepreneurs increase saving to finance new investment. The key insight is that saving has to increase more than investment to also allow for the accumulation of precautionary assets that entrepreneurs hold for self-insurance against investment risk. Numerical simulations show that this net saving increase can generate a current account improvement in line with the empirical evidence. (JEL E21, E22, F32, F41, F43, G32, L26)