Capital Account Convertibility: A New Model for Developing Countries

Quirk, Peter J.

doi:10.5089/9781451955118.001

Cited by 12 publications

(8 citation statements)

References 15 publications

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“…Drawing on the experience of industrial countries, which by the mid-1990s had all liberalised their capital accounts, several internal studies led to the conclusion that it was logical to assume that developing countries would and should liberalise their capital account at some stage in the course of their development (Quirk 1994). The progressive pattern of the removal of capital controls in developing countries, the speed of information technology advances and the associated decrease in transaction costs also lent significant support to the presumption that the integration of capital markets was unlikely to be reversed.…”

Section: Seeing Like the Imf On Capital Account Liberalisationmentioning

confidence: 99%

Seeing Like the IMF on Capital Account Liberalisation

Moschella

2012

New Political Economy

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Section: Seeing Like the Imf On Capital Account Liberalisationmentioning

confidence: 99%

Seeing Like the IMF on Capital Account Liberalisation

Moschella

2012

New Political Economy

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“…Staff reports and interviewees routinely cited the move toward capital account openness among advanced market economies as demonstrating the desirability of liberalization. Some staff—particularly big‐bang supporters, as well as those in the Asian Department—also pointed to the case of Indonesia, as it showed an emerging market could seemingly undertake rapid liberalization and maintain a commitment to it in the face of consistent balance‐of‐payments imbalances (Quirk 1994, 13). 33 Staff studies also undermined Keynesian arguments for capital controls, showing their relative ineffectiveness in supporting an independent monetary policy, preserving domestic savings, and managing balance‐of‐payments pressures (Johnston and Ryan 1994).…”

Section: The Imf and The Norm Of Capital Freedommentioning

confidence: 99%

Normative Change from Within: The International Monetary Fund’s Approach to Capital Account Liberalization

Chwieroth

2008

Int Studies Q

120

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Beginning in the mid‐1980s, in the absence of active encouragement from the IMF’s management or member states, the staff began to encourage the liberalization of capital controls as a norm. This behavior constitutes a puzzle for the conventional wisdom, which sees the “Wall Street‐Treasury Complex” as responsible for the IMF’s approach, as well as a blind spot for rationalist approaches, which offer little insight into processes that shape preference formation “from within” international organizations (IOs). In a context where the Fund’s member states permitted the staff considerable discretion and autonomy, I argue the staff’s initial adoption of the norm of capital freedom was largely shaped by three internal processes: administrative recruitment, adaptation, and learning. But norm adoption did not mean the end of internal discussion, and a vigorous debate emerged between “gradualists” and supporters of the “big bang” over how the norm should be interpreted and applied. In this “battle of ideas,” I emphasize the critical role of internal entrepreneurship.

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“…Last but not least, empirical research shows that capital controls can delay the response of economic agents to changes in macroeconomic conditions, but cannot stop capital flow (Mathieson and Rojas-Suarez, 1993;and Quirk, 1994). Underground movement of capital may have even larger destabilising impacts than transparent movements.…”

Section: B Financial Liberalisationmentioning

confidence: 99%