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MANAGING THE PROCESS OF REMOVING CAPITAL CONTROLS: WHAT DOES THE LITERATURE SUGGEST?
Author(s) -
Moore Winston
Publication year - 2014
Publication title -
journal of economic surveys
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.657
H-Index - 92
eISSN - 1467-6419
pISSN - 0950-0804
DOI - 10.1111/joes.12001
Subject(s) - economics , capital (architecture) , macroeconomics , process (computing) , empirical evidence , capital formation , capital deepening , monetary economics , public economics , financial capital , market economy , human capital , philosophy , archaeology , epistemology , computer science , history , operating system
Economic theory suggests that opening the capital account should allow a country to diversify away economic shocks, increase capital inflows, expand economic growth and efficiency as well as encourage governments to pursue good policies. The empirical evidence with regard to these theoretical predictions, however, are in some instances debatable. Many studies, for example, have reported mixed results as it relates to the impact of capital account integration on growth, exchange rates, trade and policy discipline. This paper provides a review of this literature as well as some recommendations for policymakers in relation to managing the process of removing capital controls.