Capital Mobility and the Output-Inflation Tradeoff
IMF Working Papers, May 1, 2000
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- Capital Mobility and the Output-Inflation Tradeoff
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Bibliographic details
- Authors: Assaf Razin, Prakash Loungani, Chi-Wa Yuen
- Published: May 1, 2000
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451851014.001
Summary
- Paper title: "Capital Mobility and the Output-Inflation Tradeoff"
- Authors: Assaf Razin, Prakash Loungani, Chi-Wa Yuen
- Date: May 1, 2000
- Series: Working Paper No. 2000/087
- Issue: 087
- Volume: 2000
- Pages: 22
- DOI: https://doi.org/10.5089/9781451851014.001
- ISBN: 9781451851014
- ISSN: 1018-5941
- Core finding: In countries with greater restrictions on capital mobility, a given reduction in the inflation rate is associated with a smaller loss in output.
Major findings and theoretical framing
- Empirical finding:
- Greater restrictions on capital mobility are associated with a smaller output loss for a given reduction in the inflation rate.
- Theoretical consistency:
- The result is shown to be consistent with theoretical presumption from a version of the Mundell-Fleming model.
- Measurement and data sources:
- Restrictions on capital mobility are measured using the IMF’s Annual Report on Exchange Rate Arrangements and Exchange Restrictions.
- Estimates of the output-inflation tradeoff are taken from previous studies: Lucas (1973) and Ball, Mankiw and Romer (1988).
Subject areas and keywords
- Subject: Balance of payments, Capital controls, Economic theory, Foreign exchange, Inflation, International trade, Neoclassical theory, Prices, Real exchange rates, Trade balance
- Keywords: Africa, aggregate demand elasticity, capital controls, capital immobility, capital mobility, immobility case, Inflation, mobility regime, Neoclassical theory, openness, Output-inflation tradeoff, Phillips curve, price level, Real exchange rates, Trade balance, WP
Content in this bundle
- Capital Mobility and the Output-Inflation Tradeoff - WP/00/87