A Mathematical Model of Foreign Capital Inflow
Economics
2017-05-23 v2 General Finance
Portfolio Management
Risk Management
Abstract
The paper models foreign capital inflow from the developed to the developing countries in a stochastic dynamic programming (SDP) framework. Under some regularity conditions, the existence of the solutions to the SDP problem is proved and they are then obtained by numerical technique because of the non-linearity of the related functions. A number of comparative dynamic analyses explore the impact of parameters of the model on dynamic paths of capital inflow, interest rate in the international loan market and the exchange rate.
Cite
@article{arxiv.1603.02438,
title = {A Mathematical Model of Foreign Capital Inflow},
author = {Gopal K. Basak and Pranab Kumar Das and Allena Rohit},
journal= {arXiv preprint arXiv:1603.02438},
year = {2017}
}
Comments
32 pages, 4 sets of figures each set consists of capital inflow, interest rate and exchange rate