There are many reasons for the flow of international capital, which are fundamental, general, political, and economical. This article LTG
Goldrock first share four reasons with you ~
The formation of excess capital or a large surplus in international revenue and expenditure
Excess capital refers to the relative excess capital.随着资本主义生产方式的建立，资本主义劳动生产率和资本积累率的提高，资本积累迅速增长，在资本的特性和资本家唯利是图的本性的支配下，大量的过剩资本就被输往国外，追逐高Early international capital flows are generated.With the development of capitalism, the profits obtained by capital abroad have also increased significantly. In turn, it has accelerated capital accumulation, exacerbated capital surplus, which has led to the expansion of capital output scale and exacerbating international capital flows.In the past 20 years, international economic relations have undergone tremendous changes, and the trend of integration such as international capital, finance, and economy has increased continuously. In additionCapital flow frequently and fast.In short, the formation of excess capital and a large surplus of international revenue and expenditure is an important reason for the early days of modern international capital.
Implementation of using foreign -funded strategies
Whether it is a developed country or a developing country, it will attract foreign investment to varying degrees to achieve a certain economic purpose through different policies and methods.The United States is currently the world's largest debt country.In most developing countries, the economy is relatively backward, and funds are urgently needed to accelerate the development of the country's economy. Therefore, it is often attracted to the entry of foreign capital through open markets, providing preferential taxes, and improving investment software and hardware environment.The demand for capital has caused or exacerbated the flow of international capital.
Profit
The value -added is the inherent motivation of the capital movement, and profit -driven is the common motivation for various capital outputs.When investors expect that the capital yield of one country is higher than that of other countries, capital will flow from other countries to the country; on the contrary, capital will flow from this country to other countries.In addition, when the actual profit obtained by investors in a country is higher than that of the country or other countries, the investor will increase investment in the country to obtain more international excess profits or international monopoly profits.Or exacerbate international capital flows.Driven by the profit mechanism, capital flows from countries or regions with low interest rates to countries or regions with high interest rates.This is another important reason for international capital flows.
Changes in exchange rates
The changes in exchange rates will also cause international capital flows. Especially since the 1970s, with the general establishment of the floating exchange rate system, the currency exchange rates in major countries are often fluctuated and the amplitude is large.If a country's currency exchange rate continues to rise, the need for exchange will cause international capital inflows. If a country's currency exchange rate is unstable or decreased, the capital holder may expect that the actual value of the capital holds will be reduced, and it will put it in your hand.Capital or monetary assets are converted into other countries' assets, which has led to the flow of countries or regions where capital is stable or increased in exchange rates.
Under normal circumstances, interest rates and exchange rates are positively correlated.The interest rate of one country will increase, and its exchange rate will rise; on the contrary, the interest rate of one country will decrease, and its exchange rate will rise.For example, the US dollar exchange rate declined in 1994, so the United States has raised interest rates 7 consecutive times in order to stabilize the exchange rate.Although the effect of interest rate hikes is completely effective, it depends on various factors, but interest rate hikes have indeed become a commonly used method for countries to stabilize the exchange rate.Of course, changes in interest rates and exchange rates are accompanied by frequent or large amounts of short -term international capital (tourism or hot money).
