Abstract

BLANCAS, Andrés. Capital Flight in Mexico: Analysis and Proposal for Measurement. Prob. Des [online]. 2015, vol.46, n.181, pp.11-48. ISSN 0301-7036.

This article will propose a methodology to measure capital flight in globalization. With the aid of social accounting analysis, a set of single equation error correction models and cointegration tests, this work estimates capital flight and compares the results, including a discussion and principle contributions. Capital flight is a short-term effect. Efforts to measure and analyze this phenomenon have faced challenges and ambiguities, especially now, with the added complexities of foreign portfolio investment and new financial derivatives. There is evidence of capital flight in some countries starting with the Great Recession of 2008, while the error correction model was applied to Mexico for the time period 1980-1998, when capital flight led to economic and financial destabilization.

Keywords : capital flight; foreign investment; economic globalization; single equation models; cointegration tests.

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