THE REVIVAL OF THE FELDSTEIN-HORIOKA PUZZLE AND MODERATION OF CAPITAL FLOWS AFTER THE GLOBAL FINANCIAL CRISIS (2008/09)

This study investigates the recent trend of Feldstein-Horioka puzzle and underlying reasons for moderation in capital flows. issue is analysed quite inadequately period after Global Financial Crisis, which represents a crucial turning point economic climate policies. The Puzzle estimated using World’s 13 largest economies, with panel GMM regression, between 1996 2016. We uncover that Crisis had persistent detrimental effect on liberalization, has revived mobility decreased. suggest two possible explanations such flows: increasing risk perception aversion behaviour fund supplying countries, increases home bias, controls against free flow have been applied 2008/2009.