Capital Mobility in Developing Countries: M386Some Empirical Tests

December 1, 1990

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Capital Mobility in Developing Countries: M386Some Empirical Tests, (USA: International Monetary Fund, 1990) accessed September 20, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The degree of capital mobility in developing economies is seldom estimated, even though it is widely recognized to be an important element in determining the effects of stabilization policies. Instead, an economy is assumed to be open or closed mainly on grounds of analytical convenience. This paper develops a simple approach to modelling and measuring the degree of financial openness which is applicable to developing economies. Empirical estimation using data from a large number of developing countries suggests that the effective degree of capital mobility in such economies may be higher than is commonly assumed.

Subject: Balance of payments, Capital account, Capital controls, Capital flows, Financial services, Interest rate parity, Monetary base, Money

Keywords: Capital account, Capital controls, Capital flows, Capital mobility, Capital-mobility parameter, Central America, Interest rate data, Interest rate parity, Interest rate variable, Market-clearing interest rate i., Mobility index, Monetary base, North America, WP

Publication Details

Pages:

16
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1990/117
Stock No:

WPIEA1171990
ISBN:

9781451941319
ISSN:

1018-5941

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