Why Do Countries Use Capital Controls?

Natalia Tamirisa and R. Johnston

No 1998/181, IMF Working Papers from International Monetary Fund

Abstract: Recourse to controls on capital flows among developing economies is generally quite pervasive. This paper examines the structure and determinants of capital controls based on a cross-sectional study of developing and transition economies. It identifies categories of capital transactions that can be aggregated for analytical purposes. Controls are found to be related to the balance of payments, macroeconomic management, market and institutional evolution, prudential and other factors. The relationship with the balance of payments, however, is not robust to simultaneous equation analysis.

Keywords: WP; control; capital market; market (search for similar items in EconPapers)
Pages: 37
Date: 1998-12-01
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Citations: View citations in EconPapers (87)

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