Modelling Portfolio Capital Flows in a Global Framework: Multilateral Implications of Capital Controls

Mark Taylor, Gianna Boero () and Zeyyad Mandalinci ()

No 11689, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: In the aftermath of the global financial crisis, many emerging market countries resorted to capital controls to tackle the excessive surge of capital inflows. A number of recent research papers have suggested that the imposition of controls may have imposed negative externalities on other countries by deflecting flows. Our aim in the research reported in this paper is to construct a comprehensive global econometric model which captures the dynamic interactions of capital flows with domestic and global fundamentals, and to assess the efficacy of capital controls and potential deflection eff ects on other countries. The results suggest that capital controls are e ffective for some countries in the short run, but have no lasting e ffects. Moreover, there is only limited evidence of deflection eff ects for a small number of emerging market countries.

Keywords: Portfolio capital flows; Global var (gvar); Capital controls; Emerging markets (search for similar items in EconPapers)
JEL-codes: C32 C5 F32 F42 G11 (search for similar items in EconPapers)
Date: 2016-12
New Economics Papers: this item is included in nep-ifn and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://cepr.org/publications/DP11689 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Journal Article: Modelling portfolio capital flows in a global framework: Multilateral implications of capital controls (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:11689

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP11689

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().