The vast improvements in these technologies have broadened investors' vision to the point that foreign investment appears less risky than it did in earlier times.
Accordingly, the weighted correlation between national saving rates and domestic investment rates for countries representing four-fifths of world gross domestic product (GDP) declined from a coefficient of around 0.97 in 1992, where it had hovered since 1970, to an estimated low of 0.68 last year.2 To be sure, international trade has been expanding as a share of world GDP since the end of World War II.