Capital Account Liberalization, Free Long-Term Capital Flows, Financial Crises and Economic Development

Ajit Singh

Eastern Economic Journal, 2003, vol. 29, issue 2, 191-216

Abstract: The first part of this paper examines the theoretical and empirical case for full capital account liberalization in developing countries (DCs) and finds it unconvincing. Indeed, analysis and evidence presented here point to a strong case against it. The second part considers the liberalization of only the long-term capital account, particularly FDI--a form of inflow favored by most economists. This paper argues that a multilateral agreement on investment, which denies countries the discretion to regulate FDI, will not be in the interests of DCs.

Keywords: Capital Flow; Developing Countries; Development; Liberalization (search for similar items in EconPapers)
JEL-codes: E21 F32 G2 O19 (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (41)

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Chapter: Capital account liberalisation, free long-term capital flows, financial crises and economic development (2003)
Working Paper: Capital account liberalization, free long-term capital flows, financial crises and economic development (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:eej:eeconj:v:29:y:2003:i:2:p:191-216

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