The Calculation of Chinese Short-Term International Capital Flow: Based on BOP

Gang Shi, Zee Lian

Abstract


Short-term international capital flows are generally considered to have strong volatility, strong current scale changes, and easy flow direction reversal. Thus short-term international capital flows usually exert a negative influence on a country's real economy and the financial markets, and can produce financial crises. This article briefly examines the channels of short-term international capital flows through a comparative analysis of different methods for estimating the short-term capital flows based on the Chinese Balance of International Payments (BOP), and theoretically demonstrates the relationship between direct and indirect methods. China's short-term international capital flows are subsequently calculated based on the indirect method and the improved direct method. Finally, the paper tests the estimated results, and provides conclusions and recommendations.


Full Text: PDF DOI: 10.5539/ijef.v6n8p103

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This work is licensed under a Creative Commons Attribution 3.0 License.

International Journal of Economics and Finance  ISSN  1916-971X (Print) ISSN  1916-9728 (Online)

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