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Capital inflows to Latin America


  • Reinhart, Carmen
  • Leiderman, Leonardo


Capital inflows are not an unmitigated blessing for the receiving region or country; in fact, they may pose serious dilemmas for economic policy. Large capital inflows are often associated with money and credit expansion, inflationary pressures, a real exchange rate appreciation, and a deterioration in the current account of the balance of payments. In addition, the history of Latin America provides ample evidence that massive capital inflows may also have strong impacts on the stock market, the real estate market, and the money market-impacts which may well threaten tbe stability of these markets and of the financial system as a whole.

Suggested Citation

  • Reinhart, Carmen & Leiderman, Leonardo, 1994. "Capital inflows to Latin America," MPRA Paper 13406, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:13406

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    References listed on IDEAS

    1. Guillermo A. Calvo & Leonardo Leiderman & Carmen M. Reinhart, 1994. "The Capital Inflows Problem: Concepts And Issues," Contemporary Economic Policy, Western Economic Association International, vol. 12(3), pages 54-66, July.
    2. Michael Mussa & Morris Goldstein, 1993. "The integration of world capital markets," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 245-330.
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    More about this item


    capital inflows exchange rate policy reserves capital controls;

    JEL classification:

    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • F31 - International Economics - - International Finance - - - Foreign Exchange


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