Permanent and selective capital account management regimes as an alternative to self-insurance strategies in emerging-market economies

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Currency market intervention-cum-reserve accumulation has emerged as the favored selfinsurance strategy in recipient countries of excessive private capital inflows. This paper argues that capital account management represents a less costly alternative line of defense deserving renewed consideration, especially in the absence of fundamental reform of the global monetary and financial order. Mainstream arguments in favor of financial globalization are found unconvincing; any indirect benefits allegedly obtainable through hot money inflows are equally obtainable without actually tolerating such inflows. The paper investigates the experiences of Brazil, Russia, India, and China (the BRICs) in the global crisis and subsequent recovery, focusing on their respective policies regarding capital flows.

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• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper ; No. 683

Classification and Topics

• Classification: Wirtschaft ; International Economic Order and Integration ; Current Account Adjustment; Short-term Capital Movements ; International Monetary Arrangements and Institutions ; International Finance: Other ; Financial Institutions and Services: Government Policy and Regulation ; Fiscal and Monetary Policy in Development
• Subject: capital flows ; self-insurance ; capital controls ; financial regulation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bibow, Jörg
• Event: Veröffentlichung
• (who): Levy Economics Institute of Bard College
• (where): Annandale-on-Hudson, NY
• (when): 2011

Further information

• Handle: http://hdl.handle.net/10419/56990