International Capital Transactions: Should They Be Restricted?
IMF Policy Discussion Papers, December 1, 1993
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- International Capital Transactions: Should They Be Restricted?
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Bibliographic details
- Authors: Norman S. Fieleke
- Published: December 1, 1993
- Series: IMF Policy Discussion Papers
- DOI: https://doi.org/10.5089/9781451963892.003
Summary
- Author: Norman S. Fieleke
- Date: December 1, 1993
- Core question: Whether government restrictions should be used to limit international capital movements that are considered destabilizing.
- Approach: Brief summary of recent usage of such restrictions; discussion of their international acceptance and theoretical justification; review of recent empirical studies of their efficacy; examination of their efficacy in Ireland, Spain, and Portugal during the latter part of 1992.
- Main conclusion: Such restrictions typically have no more than fleeting and minor success in attaining their objectives.
Major findings and conclusions
- Government-imposed restrictions on international capital movements are argued by some prominent economists and officials as tools to limit destabilizing capital flows.
- Empirical evidence reviewed in the paper indicates that restrictions generally achieve, at best, fleeting and minor success in meeting their stated objectives.
- The paper covers both theoretical justification and international acceptance of capital restrictions alongside empirical studies.
Case studies and scope
- Geographic focus in empirical examination: Ireland, Spain, and Portugal.
- Temporal focus for case studies: the latter part of 1992.
Subjects and keywords (as listed)
- Subjects: Balance of payments, Capital controls, Capital flows, Currencies, Exchange rates, Financial services, Foreign exchange, Interbank rates, Money
- Keywords: capital, capital control systems, Capital controls, capital controls encounter, Capital flows, capital surge, capital transactions, control, Currencies, destabilizing capital movement, Europe, Exchange rates, foreign exchange value, Interbank rates, Irish pound, market participant, PDP, Portuguese escudo, return