Title: Liberalizing Cross-Border Capital Flows: How Effective Are Institutional Arrangements against Crisis in Southeast Asia
Abstract: This paper examines capital controls in two ways. First, it assesses whether capital controls have an economic justification within the context of an economyA¢ÂÂs and, in particular, its financial sectorA¢ÂÂs stage of development. It concludes that capital controls can be justified in countries with an immature financial sector and macroeconomic imbalances. Second, it presents survey of current capital controls in ASEAN+3. It identifies three avenues for making controls more efficient: (i) a tax on capital inflows, or alternatively, a Tobin tax; (ii) a replacement of extensive administrative controls with stricter prudential standards for financial institutions; and (iii) a special treatment for Asian currency unit (ACU) operations, implying selective capital flow liberalization.
Publication Year: 2006
Publication Date: 2006-11-01
Language: en
Type: preprint
Access and Citation
Cited By Count: 40
AI Researcher Chatbot
Get quick answers to your questions about the article from our AI researcher chatbot