Capital flow waves: Surges, stops, flight, and retrenchment

► We develop a new method to identify episodes of extreme capital flow movements. ► Using gross instead of net flows yields very different results than previous work. ► Global factors, especially global risk, are correlated with all types of episodes. ► Contagion through trade, banking and region are correlated with certain episodes. ► Domestic factors are less important. Capital controls do not reduce capital waves.