Department or Program


Primary Wellesley Thesis Advisor

Joseph Joyce

Additional Advisor(s)

Akila Weerapana

Additional Advisor

Eric Hilt

Additional Advisor

Mingwei Song


Capital inflows to emerging market economies (EMEs) plunged during the global financial crisis (GFC) but surged afterwards. Both country-specific factors and global factors, which are outside the source and host countries, have affected investment decisions around the world. My thesis focuses on a comparison of the significance of country-specific and global factors in explaining portfolio investment from advanced economies (AEs) to EMEs before and after the GFC, so as to shed light on the drivers of capital inflows to EMEs. I employ a gravity-model with data from 2001-07 and 2010-14 for 20 AEs and 20 EMEs. The results suggest that VIX, a measure of global volatility, gained a higher significance in affecting portfolio debt investment from AEs to EMEs after the GFC.