Capital Inflows to Latin America: The 1970's and the 1990's

IMF Working Papers, October 1, 1992

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Capital Inflows to Latin America: The 1970's and the 1990's

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Bibliographic details

• Authors: Carmen Reinhart, Guillermo Calvo, Leonardo Leiderman
• Published: October 1, 1992
• Series: IMF Working Papers
• DOI: https://doi.org/10.5089/9781451954265.001

Overview and purpose

• Authors: Carmen Reinhart, Guillermo Calvo, Leonardo Leiderman
• Publication date: October 1, 1992
• Paper presented at the Tenth World Congress of the International Economic Association held in Moscow in August 1992.
• Aim: To compare recent sizable international capital inflows to Latin America (past two years) with the experience of the late 1970s and to assess vulnerability to an unexpected and swift reversal in capital inflows.

Analytical framework and major themes

• The analysis examines differences and similarities between the two episodes in three broad areas:
  • Domestic macroeconomic conditions in the recipient countries at the outset of both episodes.
  • The behavior of the external factors that influence the international allocation of capital.
  • The response of key macroeconomic variables, such as the real exchange rate, reserves, and stock prices.

Key findings (as stated in the summary)

• During the past two years Latin America has received sizable international capital inflows.
• The paper compares the recent experience with that of the late 1970s.
• The response of key macroeconomic variables analyzed includes:
  • Real exchange rate
  • Reserves
  • Stock prices
• The paper aims at assessing how vulnerable these economies are to an unexpected and swift reversal in capital inflows.
• The paper examines whether there are signs that the vulnerability has changed appreciably over time.

Subjects and keywords (as listed)

• Subjects:
  • Balance of payments
  • Capital inflows
  • Exports
  • External debt
  • Financial markets
  • Foreign exchange
  • International trade
  • Real exchange rates
  • Stock markets
• Keywords:
  • Capital inflows
  • consumer price index
  • creating flow
  • debt crisis
  • exchange rate appreciation
  • Exports
  • external borrowing
  • inflation rate
  • net capital
  • rate debt
  • Real exchange rates
  • Stock markets
  • terms of trade
  • Western Hemisphere
  • world debt table
  • WP

Disclaimer (as provided in source)

• 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.

IMF Working Paper: "Capital Inflows to Latin America: The 1970's and the 1990's", Carmen Reinhart, Guillermo Calvo, Leonardo Leiderman, October 1, 1992.