This study analyzes the effectiveness of capital controls on international debt flows using data of 81 economies, including both advanced and emerging economies, over the period from 1995 to 2019. The analysis using the total sample shows that, although they are in the expected directions, the...

Free capital movements played an important part in the economic integration and globalisation of the nineteenth century. By the end of the century capital flows were on a remarkable scale.The modern use of capital controls dates back to the 1930s. Professor Capie analyses historical experience...

This paper examines possible heterogeneity in the direct and spillover effects of capital control on gross capital flows. First, I introduce signaling effect of capital control in a portfolio choice model with a multi-country set up to demonstrate the possibly heterogeneity in the direct effect...

This paper provides an analysis of the use and effects of capital controls in 27 AEs and EMDEs which experienced at least one financial crisis between 1995 and 2017. Countries often turn to using capital controls in crisis: some ease inflow controls while others tighten controls on outflows. A...

A central prediction of open economy models with a pecuniary externality due to a collateral constraint is that the unregulated economy overborrows relative to what occurs under optimal policy. A maintained assumption in this literature is that households borrow directly from foreign lenders....

With rising financial integration, the magnitude and swings in capital flows have increased in the past two decades, intensifying the policy debate on how best to deal with these flows. This paper assesses the use and effectiveness of capital controls in limiting inflow surges. Using a novel...

This study aims to identify the need for ambiguity as a result of mixed and contradictory suggestions of the trade agreement and capital liberalisation on a country’s welfare. Using more comprehensive datasets on inflow and outflow capital control, we find significant and mixed capital control...

The performance of a reserve requirement rule combined with foreign exchange intervention under the capital outflow shock is studied in a dynamic stochastic model of a small open economy. The model features a two-pillar toolkit of the monetary and macroprudential policies involving a hybrid...

In this study, we construct a set of monthly de jure indexes that measure the on-going changes in capital controls in 190 countries from 1999 to 2019. The information about policy changes on capital accounts is extracted from the International Monetary Fund’s Annual Report on Exchange...

This paper shows that the adoption of fiscal rules (FRs) decreases the use of capital controls and increases international financial integration. This result is robust to alternative measures of fiscal rules, capital controls, and international financial integration; it is also robust to...

The present international financial architecture (IFA) has been weakening since the early 2010s. Several factors have hindered the reorganization of the current IFA, accelerated the bipolarization of international financial relations, and reshaped the balance of power between sovereign debtors...

This paper provides a brief overview of China's capital controls, external asset holdings and the real interest rate, and analyzes the quantitative effects of China's macroeconomic policies between 2000 and 2015, including capital controls, interest rate policy, exchange rate policy and fiscal...

We investigate how internal distribution motives can interfere with the economic objectives of capital controls. In order to do this, we provide a model showing that elite capture can affect optimal debt repatriations and the management of official reserves under capital controls. Relying on...

The paper analyzes the heterogeneous direct and spillover effect of capital control on gross capital inflows to three major institutional sectors namely public sector, banks and corporate using spatial econometric models. The findings indicate that the direct effect of capital control moderates...

This paper examines questions related to possible capital account liberalisation in the Mediterranean countries. First, we provide an overview of the extent to which these countries have capital controls along with their exchange rate regimes and some basic macroeconomic aggregates. Second, we...

This paper quantifies the positive and normative effects of international capital controls on global and regional economic activity under The Bretton Woods international financial system and thereafter. A three region, open economy, DSGE capital flows accounting framework consisting of the U.S.,...

Capital control is used as policy toolkit for safeguarding domestic economy from the volatility of capital flows. However, the effect of capital control is rather far fetched as the signaling effect of capital control can moderate investor's outlook about domestic economy and thereby outweighs...

This work is an analysis of the Economocracy and Representative Economocracy. A reformed economic system is required for the transformation of global grown debt to sustainable levels. The challenge to avoid economic worldwide deadlock yields the emerging need for economocracy as a premium...

Capital controls may adversely affect international trade. This study aims to demonstrate the usefulness of capital controls for reducing macroeconomic volatilities and then mitigating their negative effects on international trade. Using quarterly data, we applied a dynamic panel approach to a...