Liberalizing Capital Flows and Managing Outflows : Background Paper / International Monetary Fund.

Format:

Book

Author/Creator:

International Monetary Fund, author, issuing body.

Series:

Policy Papers ; Volume 2012: Issue 014

Language:

English

Subjects (All):

Foreign exchange rates.

Capital movements.

Physical Description:

1 online resource (59 pages).

Other Title:

Liberalizing Capital Flows and Managing Outflows

Place of Publication:

Washington, D.C. : International Monetary Fund, 2012.

Summary:

Liberalization of capital flows can benefit both source and recipient countries by improving resource allocation, reducing financing costs, increasing competition and accelerating the development of domestic financial systems. The empirical evidence, however, is mixed on the benefits, and it suggests that countries benefit most when they meet certain thresholds related to institutional and financial development. The principal cost of capital flow liberalization stems from the economic instability brought on by volatile capital flows. In extreme cases, sudden stops or reversals in capital inflows can trigger financial crises followed by prolonged periods of weak growth.

Contents:

I. The Pros and Cons of Liberalizing Capital Flows-A Literature Review

II. Effects of Capital Flow Liberalization-Evidence from the Recent Experiences of Emerging Market Economies

III. Financial Openness in Emerging Market Economies and the Global Crisis

IV. International Agreements and Liberalization of Capital Flows

V. Korea - Gradual Liberalization of Capital Flows

VI. Iceland-Capital Controls and Crisis

VII. Russia-Liberalization of Capital Flows and the Crisis

VIII. Ukraine-Experience with Capital Controls During the Crisis

IX. Effectiveness of Capital Outflow Controls

X. Measuring Openness to Capital Flows

References

Tables

1. Countries that Liberalized During 1995-2010

2. Panel Regressions-Full Sample

3. Panel Regressions-Above Threshold Sample

4. Panel Regressions-Below Threshold Sample

5. Data Definitions and Sources

6. Peak-to-Trough Decline in Growth

7. Growth Impact in 2009

8. Cumulative Growth Impact over 2009-2011

9. Russia: Inward Foreign Direct Investment by Country of Origin, 2010

10. Definitions and Sources of Variables

11. Ranking of Countries in Terms of Macroeconomic Fundamentals

Figures

1. Korea: Trade as a Share of GDP, 2001-2011

2. Korea: Capital and Financial Account, 2001-2011

3. Korea: Official Reserve and Exchange Rate Dynamics, 2001-2012

4. Korea: Short-Term External Borrowing, 2005-2011

5. Iceland: Offshore Krona Assets, October 2008-October 2011

6. Iceland: Exchange Rate Developments and International Reserves, 2008-2011

7. Iceland: Krona Exchange Rate (Onshore) and Central Bank of Iceland Policy Rates, 2008-2011

8. Russia: BRICS-De Jure Capital Flow Restrictiveness

9. Russia: Private Sector Capital Flows, 2000-2010

10. Russia: Composition of Capital Flows, 2004-2010

11. Russia: Financial Sector Expansion, 2000-2010

12. Russia: Foreign Exchange Interventions and Nominal Exchange Rate, 2007-2011

14. Ukraine: Sovereign Credit Default Swap Spread, 2008-2011

13. Ukraine: Exchange Rate and International Reserves, 2007-2011

15. Ukraine: Deposits in the Banking System, 2008-2011

16. Impact of Outflow Control Tightening-Full Country Sample

17a. Impact of Outflow Control Tightening-Countries with Better-than-Median Fundamentals, Macroeconomic Variables

17b. Impact of Outflow Control Tightening-Countries with Better-than-Median Fundamentals, Capital Flows

18. Impact of Outflow Control Tightening-Countries with Better-than-Median Fundamentals in Net Outflow Periods

19. Impact of Outflow Control Tightening-Countries with Better-than-Median Fundamentals in Net Inflow Periods.

Notes:

Description based on publisher supplied metadata and other sources.

ISBN:

9781498381338

1498381332