Template-Type: ReDIF-Paper 1.0
Title: Asset Price Changes, External Wealth and Global Welfare
Author-Name: Timothy Meyer
Author-Email: timothy.meyer@uni-bonn.de

Classification-JEL:  F21, F32, F40, G15
Keywords: Foreign Assets, Global Imbalances, Valuation Effects

Abstract: U.S. equity outperformance and sustained dollar appreciation have led to large valuation gains
for the rest of the world on the U.S. external position. I construct their global distribution,
carefully accounting for the role of tax havens. Valuation gains are concentrated and large in
developed countries, while developing countries have been mostly bypassed. To assess the
welfare implications of these capital gains, I adopt a sufficient statistics approach. In contrast
to the large wealth changes, most countries so far did not benefit much in welfare terms. This is
because they did not rebalance their portfolios and realize their gains, while they were further
hurt by rising import prices from the strong dollar.

Note: 
Length: 82
Creation-Date: 2024-04
Revision-Date: 
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp534
File-Format: application/pdf
Handle: RePEc:bon:boncrc:CRCTR224_2024_534