Cover IMF Working Papers
Liberalization of the Capital Account: Experiences and Issues
Author:
Mr. Donald J Mathieson
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and
Ms. Liliana Rojas-Suáreznull

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Series:
IMF Working Papers
Volume/Issue:
Volume 1992: Issue 046
Language:
English
Publication Date:
01 Jun 1992
DOI:
https://doi.org/10.5089/9781451973754.001
ISBN:
9781451973754
ISSN:
1018-5941
Pages:
60
Keywords:
WP; capital control; capital flow; U.S. dollar; financial system; current account; borrowing cost; rate of inflation; fixed interest rate; flight capital; capital controls bureaucracy; exchange rate system; interest rate differential; Capital controls; Capital flows; Capital account convertibility; Capital account; Real exchange rates; Global
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper reviews the experience with capital controls in industrial and developing countries, considers the policy issues raised when the effectiveness of capital controls diminishes, examines the medium-term benefits and costs of an open capital account, and analyzes the policy measures that could help sustain capital account convertibility. As the effectiveness of capital controls eroded more rapidly in the 1980s than in earlier periods, new constraints were placed on the formulation of stabilization and structural reform programs. However, experience suggests that certain macroeconomic, financial, and risk management policies would allow countries to attain the benefits of capital account convertibility and reduce the financial risks created by an open capital account.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund
Volume 1992: Issue 046