On The Impact Of The Global Cross-border Capital Flows On Economic Growth Empirical Research

With the advance of economic globalization, international capital flows has been expanding since1990s. Since the global economic crisis occurred in2008, a great deal of international capitals has been flowing to the developing countries, thereby increases the difficulty of policy implementation. What a role does the international capital flows play in the economic development? Does the different types of capital flows have the same impact on a country’s economic development? What a role does various types of international capital inflows and outflows play in one country’s economic growth and economic stability? These questions are very important for the effective management and use of international capital to develop our economy.Firstly,this paper reviews the theoretical frontiers and empirical studies. Secondly, this paper makes a serious analysis on the status and characteristics of the global capital flows. Based on the annual data from68countries, the paper makes a Panel Data model to find the impact of international capital flows on economic growth and other economic factors. The conclusion is as follows:the international capital flows has a different impact on the countries at different stages of development. International capital flows helps promoting the economic growth of developed countries, enhancing national welfare, but may increase pressure on appreciation of its currency. For the developing countries, international capital flows has no significant effects on its economic growth, domestic prices, and national welfare, but has significant effects on the valuation of its currency. For the countries in transition, the international capital inflows can promote its economic growth, the capital outflows has no significant impact on its economic growth.Finally, based on the current status and empirical findings, this paper advises the China’s policy choices as follows:to strengthen cross-border capital monitoring and early warning; strengthen supervision on short-term capital flows; optimize the structure of international capital inflows, and increase the utilization efficiency of foreign capital; accelerate the pace of "go global", and effectively improve the return of foreign investment.