Liqing Zhang, Central University of Finance and Economics: This is an interesting paper that should be considered as a valuable extension of the research on the main reasons behind capital flows into emerging market economies (EMEs) over the past decades. There has been a long debate on whether the pull factor or push factor plays a dominant role for the massive capital inflows into EMEs since the beginning of 1990s. When Helene Rey's paper about the global financial circle was published in 2013, the issue became more interesting and much richer in policy implication.
This paper is well structured. Using the OLS regression, the baseline empirical model, and the data from 47 countries, the authors found that sizable heterogeneity exists across country groups. Specifically, the major drivers of capital inflows to AEs are both push and pull factors, but the push factor turns out to be the main determinant of...