The effectiveness of capital controls and macroprudential measures

Junyong Lee, Kyounghun Lee and Frederick Dongchuhl Oh

KDI Journal of Economic Policy, 2023, vol. 45, issue 4, 1-22

Abstract: We review the literature on the effectiveness of capital controls and macroprudential measures. First, we explain the purposes and examples of capital controls and macroprudential policies. We then analyze various theoretical models and empirical findings from prior studies that investigate the effectiveness of each instrument. Moreover, we review several studies that directly compare the two instruments and discuss whether policymakers should implement capital controls or macroprudential measures to overcome financial crises. Finally, based on a discussion of the findings of previous studies, we suggest several possible avenues for future research.

Keywords: Capital Control; Macroprudential Measure; Financial Crisis (search for similar items in EconPapers)
JEL-codes: F38 G15 G28 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:kdijep:282013

DOI: 10.23895/kdijep.2023.45.4.1

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