 IMF conditionality and capital controls: Capital account liberalization to capital inflow management?Makram El‐Shagi and
Steven J. Yamarik
Review of International Economics, 2021, vol. 29, issue 3, 590-605 Abstract: Since the end of the Bretton Woods system, promoting capital account liberalization has been one of the tenants of the IMF. Capital account liberalization was deemed one of the 10 pillars of what was often dubbed the “Washington Consensus.” Yet, things changed drastically with the Global Financial Crisis of 2008. From 2009 to 2012, comments from top IMF officials and staff reports displayed quite clearly that the IMF had revised its position where capital controls could be part of the toolkit. In this paper, we assess the role of the IMF in capital account liberalization from 1995 to 2015. We use a midpoint‐inflated ordered probit model to estimate the effects of being under IMF conditionality on capital controls, allowing for different effects for pre‐ and post‐Financial Crisis. We find that the IMF did indeed drive liberalization of capital inflows in the precrisis era, but stopped doing so in the postcrisis period. Date: 2021 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:reviec:v:29:y:2021:i:3:p:590-605 Ordering information: This journal article can be ordered from Access Statistics for this article Review of International Economics is currently edited by E. Kwan Choi More articles in Review of International Economics from Wiley Blackwell |
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