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Capital inflows to Latin America with reference to the Asian experience

Author

Listed:
  • Reinhart, Carmen
  • Calvo, Guillermo
  • Leiderman, Leonardo

Abstract

This essay has four objectives. The first is to document the current episode of capital inflows to Latin America based on data for ten Latin American countries. 6 The second is to compare the Latin American experience with that of a number of Asian countries that have also been the recipients of sizable capital inflows and examine to what extent the nature of the capital inflows and macroeconomic consequences are similar in the two cases. The third is to assess the role of external factors in accounting for the observed capital inflows and the real exchange rate appreciation in Latin America. Last, the chapter discusses the implications of capital inflows for economic policy.

Suggested Citation

  • Reinhart, Carmen & Calvo, Guillermo & Leiderman, Leonardo, 1995. "Capital inflows to Latin America with reference to the Asian experience," MPRA Paper 13840, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:13840
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    File URL: https://mpra.ub.uni-muenchen.de/13840/2/MPRA_paper_13840.pdf
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    References listed on IDEAS

    as
    1. Donald J Mathieson & Liliana Rojas-Suárez, 1992. "Liberalization of the Capital Account; Experiences and Issues," IMF Working Papers 92/46, International Monetary Fund.
    2. Blanchard, Olivier Jean, 1989. "A Traditional Interpretation of Macroeconomic Fluctuations," American Economic Review, American Economic Association, vol. 79(5), pages 1146-1164, December.
    3. Stiglitz, Joseph E, 1990. "Symposium on Bubbles," Journal of Economic Perspectives, American Economic Association, vol. 4(2), pages 13-18, Spring.
    4. D. F. I. Folkerts-Landau & Donald J Mathieson & Morris Goldstein & Liliana Rojas-Suárez & José Saúl Lizondo & Timothy D. Lane, 1991. "Determinants and Systemic Consequences of International Capital Flows," IMF Occasional Papers 77, International Monetary Fund.
    5. Bernanke, Ben S., 1986. "Alternative explanations of the money-income correlation," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 25(1), pages 49-99, January.
    6. Guillermo A. Calvo, 1983. "Trying to Stabilize: Some Theoretical Reflections Based on the Case of Argentina," NBER Chapters,in: Financial Policies and the World Capital Market: The Problem of Latin American Countries, pages 199-220 National Bureau of Economic Research, Inc.
    7. Alexander K. Swoboda & Jacob A. Frenkel & Jacques R. Artus, 1983. "Exchange Rate Regimes and European-U.S. Policy Interdependence [with Comments] (Régimes de taux de change et interdépendance des politiques économiques en Europe et aux Etats-Unis) (Régimen cambia," IMF Staff Papers, Palgrave Macmillan, vol. 30(1), pages 75-112, March.
    8. Mohamed A. El-Erian, 1992. "Restoration of Access to Voluntary Capital Market Financing: The Recent Latin American Experience," IMF Staff Papers, Palgrave Macmillan, vol. 39(1), pages 175-194, March.
    9. James H. Stock & Mark W. Watson, 1989. "New Indexes of Coincident and Leading Economic Indicators," NBER Chapters,in: NBER Macroeconomics Annual 1989, Volume 4, pages 351-409 National Bureau of Economic Research, Inc.
    10. Calvo, Guillermo & Vegh, Carlos, 1991. "Exchange rate stabilization under imperfect credibility," MPRA Paper 20486, University Library of Munich, Germany.
    11. Watson, Mark W. & Engle, Robert F., 1983. "Alternative algorithms for the estimation of dynamic factor, mimic and varying coefficient regression models," Journal of Econometrics, Elsevier, vol. 23(3), pages 385-400, December.
    12. Carlos F. Diaz-Alejandro, 1984. "Latin American Debt: I Don't Think We Are in Kansas Anymore," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 15(2), pages 335-403.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Ramkishen Rajan, 2010. "Sand in the Wheels of International Finance: Revisiting the Debate in Light of the East Asian Mayhem," Working Papers id:2686, eSocialSciences.
    2. Ramkishen Rajan, 2010. "The Currency and Financial Crisis in Southeast Asia: A Case of 'Sudden Death' or Death Foretold'?," Working Papers id:2583, eSocialSciences.
    3. Paolo Manasse & Luca Zavalloni, 2013. "Sovereign Contagion in Europe: Evidence from the CDS Market," Working Papers 471, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    4. Bartolini, Leonardo & Drazen, Allan, 1997. "When liberal policies reflect external shocks, what do we learn?," Journal of International Economics, Elsevier, vol. 42(3-4), pages 249-273, May.
    5. Graham Bird & Ramkishen S. Rajan, 2001. "Coping with, and cashing in on, international capital volatility," Journal of International Development, John Wiley & Sons, Ltd., vol. 13(1), pages 1-23.
    6. Heymann, Daniel, 2001. "Regional interdependencies and macroeconomic crises: notes on MERCOSUR," Estudios y Perspectivas – Oficina de la CEPAL en Buenos Aires 5, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    7. Luiz Bresser-Pereira & Paulo Gala, 2009. "Why Foreign Savings Fail to Cause Growth," International Journal of Political Economy, Taylor & Francis Journals, vol. 38(3), pages 58-76.
    8. Miguel A Savastano & Paul R Masson & Sunil Sharma, 1997. "The Scope for Inflation Targeting in Developing Countries," IMF Working Papers 97/130, International Monetary Fund.
    9. repec:eee:ecmode:v:67:y:2017:i:c:p:368-380 is not listed on IDEAS
    10. Pereira, Luiz C. Bresser & Nakano, Yoshiaki, 2002. "Economic growth with foreign saving?," Textos para discussão 118, FGV/EESP - Escola de Economia de São Paulo, Getulio Vargas Foundation (Brazil).
    11. Melike Altinkemer, 2001. "Capital Inflows And Central Bank’s Policy Response," Discussion Papers 0103, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
    12. Sebastian Edwards, 1999. "Crisis Prevention: Lessons from Mexico and East Asia," NBER Working Papers 7233, National Bureau of Economic Research, Inc.
    13. Cinquetti, Carlos A., 2000. "The Real Plan: Stabilization and Destabilization," World Development, Elsevier, vol. 28(1), pages 155-171, January.
    14. Linda M. Koenig, 1996. "Capital Inflows and Policy Responses in the AsEAN Region," IMF Working Papers 96/25, International Monetary Fund.
    15. Maria Angelica Arbelaez & Juan Jose Echavarria, 2002. "Credit, Financial Liberalization and Manufacturing Investment in Colombia," Research Department Publications 3145, Inter-American Development Bank, Research Department.

    More about this item

    Keywords

    capital flows real exchange rate international reserves reversals crises;

    JEL classification:

    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • F3 - International Economics - - International Finance

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