Controls on capital inflows: do they work?
AbstractThis paper analyzes the effectiveness of capital controls, in particular the Chilean experience with the use of the unremunerated reserve requirement. We examine the effects on interest rates, real exchange rate, and the volume and composition of capital inflows. The effects are elusive and it is difficult to pin down long-run effects. Although after the unremunerated reserve requirement was introduced there was an increase in the interest rate differential, the econometric evidence does not show it has a significant long-run effect on interest rate differentials. There are also no effects on the real exchange rate. However, the more persistent and significant effect is on the composition of capital inflows, tilting composition toward longer maturity.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Development Economics.
Volume (Year): 63 (2000)
Issue (Month): 1 (October)
Contact details of provider:
Web page: http://www.elsevier.com/locate/devec
Other versions of this item:
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- F30 - International Economics - - International Finance - - - General
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- En defensa de los controles de capital
by Eduardo Levy-Yeyati in Foco Económico on 2010-12-15 12:00:00
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