The Impact of Controlson Capital Movementson the Private Capital Accounts of Countries' Balance of Payments: Empirical Estimates and Policy Implications

July 1, 1994

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Format: Chicago

R. B. Johnston, and Chris Ryan. The Impact of Controlson Capital Movementson the Private Capital Accounts of Countries' Balance of Payments: Empirical Estimates and Policy Implications, (USA: International Monetary Fund, 1994) accessed November 9, 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

This paper reports research on the impact of controls on capital movements on the private capital accounts of countries’ balance of payments using data drawn from 52 countries for the period 1985-92. The results indicate that: (1) capital controls operated by developing countries have not been effective in insulating the private capital accounts of these countries’ balance of payments, and (2) capital controls operated by industrial countries significantly affected the structure of their capital flows mainly by inhibiting net foreign direct and portfolio investment outflows. The results, which are consistent with other observations, raise issues for the policy toward the maintenance and liberalization of controls on capital movements by developing countries.

Subject: Balance of payments, Capital account, Capital controls, Capital flows, Capital outflows, Exchange restrictions, Foreign exchange

Keywords: Australia and New Zealand, Capital account, Capital control, Capital controls, Capital controls' effect, Capital flow equation, Capital flows, Capital movement, Capital outflows, Capital transaction, Capital transfer, Control regime, Controlson capital Movementson, Countries' capital control regime, Exchange control nature, Exchange control responsibility, Exchange restrictions, Explaining capital movement, Middle East, Net capital, Restrictive capital control, Significance of the capital control dummy, WP

Publication Details

Pages:

46
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1994/078
Stock No:

WPIEA0781994
ISBN:

9781451956207
ISSN:

1018-5941

Notes

Study based on data drawn from 52 countries for the period 1985-92.

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