Estimates of Capital Flight and Its Behavior

Abstract

This paper presents estimates of capital flight using eight alternative methodologies, with a focus on Latin America. While these methodologies differ in approach, I show that the identities used in balance-of-payments data make most close in their final measurement. I document that capital flight is not an exclusively Latin American phenomenon, but is much wider spread than commonly thought. Compared to countries' exports, capital flight is evenly distributed, and the capital flight-exports Lorenz-curve is close to the 45-degree line. There also appear to be important common factors driving capital flight as there is considerable comovement across countries in certain years.