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Capital Account Liberalization and Financial Sector Stability

Capital Account Liberalization and Financial Sector Stability
Author: Friedrich Ivan Schneider
Publisher:
Total Pages: 94
Release: 2002
Genre: Banks and banking
ISBN: 9781589060852

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This paper analyses the links between capital account liberalisation and other policies influencing financial sector stability. Drawing on country experiences, it develops an operational framework for the co-ordination of capital account liberalisation, particularly with structural policies to strengthen the domestic financial system.


Advanced Country Experiences with Capital Account Liberalization

Advanced Country Experiences with Capital Account Liberalization
Author: Age Bakker
Publisher: International Monetary Fund
Total Pages: 72
Release: 2002-09-26
Genre: Business & Economics
ISBN: 1589061179

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After the industrial countries established current account convertibility in the late1950s, they began to phase out their capital controls. Their efforts were slow and tentative at first, but built up considerable momentum by the 1980s as market-oriented economic policies gained popularity. This paper describes how national policymakers’ views of capital controls shifted over time, and how these controls have been closely related to regulation in other policy areas, such as banking and financial markets. As developing countries seek to liberalize their capital accounts to obtain the benefits of increased integration with the global economy, what lessons can be drawn from industrial countries’ diverse experiences with capital controls, and how can a country’s liberalization measures be sequenced to minimize disturbances to its exchange rate and monetary policies?


What has Capital Liberalization Meant for Economic and Financial Statistics

What has Capital Liberalization Meant for Economic and Financial Statistics
Author: Mr.Robert M. Heath
Publisher: International Monetary Fund
Total Pages: 31
Release: 2015-04-30
Genre: Business & Economics
ISBN: 1475518552

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The liberalization of capital flows both in the domestic economy and cross-border has been among the most important policies adopted by IMF member countries over recent decades. The impact has been wide-ranging. This paper looks at the impact on the field of economic and financial statistics in the past two decades, as statisticians have responded to the changing policy needs. The paper considers the historical context of changes that have occurred, draws out the key trends, and asks where these trends might lead statisticians in the foreseeable future. The paper considers that there has been nothing short of a revolution in the field of economic and financial statistics over the past two decades led by a need for greater transparency; greater standardization; new data sets to support understanding of financial interconnections and financial sector risks; and the strengthening of the governance of the statistical function through greater independence of statistical agencies.


Financial Risks, Stability, and Globalization

Financial Risks, Stability, and Globalization
Author: Mr.Omotunde E. G. Johnson
Publisher: International Monetary Fund
Total Pages: 576
Release: 2002-04-29
Genre: Business & Economics
ISBN: 9781589060128

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This book covers financial sector stability issues in the following areas: risk management and governance in financial institutions; financial crises and contagion; domestic monetary and financial policies; and international cooperation. The papers were presented at the IMF’s eighth Central Banking Seminar by authors from academia, investment banks, government, and international institutions. The papers discuss such subjects as bank soundness, systemic bank restructuring, and the safety and efficiency of systemically important payment systems and their interaction with the macroeconomic environment.


Beyond Capital Ideals

Beyond Capital Ideals
Author: Gerard Caprio
Publisher: World Bank Publications
Total Pages: 46
Release: 1999
Genre: Bank
ISBN:

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"Hard on the heels of Mexico's crisis in 1994, a wave of financial crises swept across emerging economies-- from East Asia and Russia to Brazil-- bringing the fragility of banking and finance into unprecedented focus. What has gone wrong?--Cover.


Effects of Capital Flow Liberalization

Effects of Capital Flow Liberalization
Author: Tahsin Saadi Sedik
Publisher: International Monetary Fund
Total Pages: 27
Release: 2012-11-16
Genre: Business & Economics
ISBN: 1589068033

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This paper analyzes the experiences of emerging market economies (EMEs) that have liberalized capital flows over the past 15 years with respect to macroeconomic performance and risks to financial stability. The results of the panel data regressions indicate that greater openness to capital flows is associated with higher growth, gross capital flows, and equity returns and with lower inflation and bank capital adequacy ratios. The effects vary depending on thresholds. As a potential application of these findings, the paper explores the possible effects of liberalization on China by applying the coefficients of explanatory variables to the corresponding variables of China in 2012–16.


Capital Account Liberalization and Stability of Capital Markets in India - An Empirical Analysis

Capital Account Liberalization and Stability of Capital Markets in India - An Empirical Analysis
Author: Lerkshmi R. Nair
Publisher:
Total Pages: 30
Release: 2014
Genre:
ISBN:

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This paper examines the implications of capital account liberalization on the stability of capital markets in India using monthly data for the period 1993-94 to 2007-08. Based on the IMF World Bank framework (2005) to monitor financial sector stability, the stability of capital markets is captured in terms of two indicators, the market liquidity indicator and market volatility. The empirical analysis, after controlling for other variables affecting the stability of capital markets, shows that capital account liberalization; particularly foreign portfolio investment liberalization has not contributed significantly to market liquidity whereas it has contributed significantly to increased market volatility. Thus this study suggests that the opening up of capital account might have made the capital markets more vulnerable to the fluctuations of cross border movements of capital without achieving the benefits. These results are particularly relevant since India opened its financial markets to Foreign Portfolio flows at an earlier stage of its reform process much before the development of domestic financial markets unlike the sequencing pattern flowed by most countries that were undergoing similar process of liberalization. Further, these results have important policy implications since the choice of an attitude towards full capital account convertibility in India has become a debateful issue.


Putting the Cart Before the Horse? Capital Account Liberalization and Exchange Rate Flexibility in China

Putting the Cart Before the Horse? Capital Account Liberalization and Exchange Rate Flexibility in China
Author: Mr.Eswar Prasad
Publisher: International Monetary Fund
Total Pages: 32
Release: 2005-01-01
Genre: Business & Economics
ISBN: 1451975457

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This paper reviews the issues involved in moving towards greater exchange rate flexibility and capital account liberalization in China. A more flexible exchange rate regime would allow China to operate a more independent monetary policy, providing a useful buffer against domestic and external shocks. At the same time, weaknesses in China’s financial system suggest that capital account liberalization poses significant risks and should be a lower priority in the short term. This paper concludes that greater exchange rate flexibility is in China’s own interest and that, along with a more stable and robust financial system, it should be regarded as a prerequisite for undertaking a substantial liberalization of the capital account.


Financial Sector Reforms, Economic Growth, and Stability

Financial Sector Reforms, Economic Growth, and Stability
Author: Shakil Faruqi
Publisher: World Bank Publications
Total Pages: 288
Release: 1994-01-01
Genre: Business & Economics
ISBN: 9780821330135

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"Compares financial sector reforms and their impact on economic growth and stability in selected countries of Latin America and Asia. Articles range from the quite specific (e.g., securities regulation in Thailand), to more general"--Handbook of Latin American Studies, v. 57.