Chris Burford wrote:
> Why with all this accelerated movement of financical assets around the
> world's computer terminals is the net result usually zero in terms of
> transfer of real assets?
>
> And secondly, if that is so, why have these movements accelerated so much
> in the last couple of decades?
Good questions. The Feldstein Horioka result is usually taken to be a paradox. Feldstein pushed it to say that we must save more; i.e., tax capitalists less to encourage savings.
By the way, Doug criticized me yesterday for treating Suharto's wealth as a stock. No. When a dictator falls -- the question as to whether he will actually fall is still open -- that stock soon turns into a flow. I doubt that Baby Doc has many bank accounts in Haiti. Of course, if the current government survives, then Doug is correct. I should have been clearer.
-- Michael Perelman Economics Department California State University Chico, CA 95929
Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu