Effectiveness of Capital Controls in Selected Emerging Markets in the 2000's

This paper estimates the effectiveness of capital controls in response to inflow surges in Brazil, Colombia, Korea, and Thailand in the 2000s. Controls are generally associated with a decrease in inflows and a lengthening of maturities, but the relationship is not statistically significant in all cases, and the effects are temporary. Controls are more successful in providing room for monetary policy than dampening currency appreciation pressures. We argue that the macroeconomic impact of capital controls depends on the extensiveness of the policy, the level of capital market development, the support provided by other policies, and the persistence of capital flows.Capital controls;Private capital flows;Capital inflows;capital flows, net capital flows, current account balance, net capital, exchange rates, capital control, foreign exchange, capital transactions, private capital, capital market, capital outflows, capital markets, capital inflow, financial markets, determinants of capital flows, international capital flows, capital flow, capital movements, debt securities, hedging, foreign capital, international financial, capital outflow, stock market, capital account transactions, equity investments, global financial crisis, international financial statistics, equity inflows, international capital, capital market development, global financial stability, securities trading, international borrowing, export revenues, commercial credits, determinants of capital flow, domestic capital, foreign trade, spot market, liberalization of capital, consumer price index, gross domestic product, current account deficit, commodity prices, movement of capital, private investors, domestic bonds, strong capital inflows, risk aversion, equity prices, securities companies, global liquidity, domestic capital market, equity investment, capital accounts, stock exchange, capital account restrictions

Dedollarization

This paper provides a summary of the key policies that encourage dedollarization. It focuses on cases in which the authorities’ intention is to gain greater control of monetary policy and draws on the experiences of countries that have successfully dedollarized. Unlike previous work on the subject, this paper examines both macroeconomic stabilization policies and microeconomic measures, such as prudential regulation of the financial system. This study is also the first attempt to make extensive use of the foreign exchange regulation data reported in the IMF’s Annual Report on Exchange Arrangements and Exchange Restrictions. The main conclusion is that durable dedollarization depends on a credible disinflation plan and specific microeconomic measures.Dollarization;Bank supervision;Disinflation;Exchange rate variability;foreign currency, foreign exchange, exchange rate, inflation, monetary policy, exchange rate volatility, currency substitution, exchange risk, foreign exchange risk, flexible exchange rate, real exchange rate, exchange rate policy, fixed exchange rate, exchange rate arrangement, nominal exchange rate, exchange rate flexibility, exchange rate regime, inflation rate, low inflation, exchange rate risk, macroeconomic stability, real interest rates, exchange restrictions, financial stability, foreign exchange transactions, exchange rate risks, exchange transactions, currency transactions, exchange rate appreciation, floating exchange rate, real exchange rate volatility, exchange controls, inflation targeting, foreign exchange market, exchange rates, foreign exchange holdings, flexible exchange rate regime, currency risk, aggregate demand, fixed exchange rate regime, exchange rate instability, exchange control, floating exchange rate regime, exchange risks, exchange arrangements, exchange rate regimes, currency markets, high inflation, reduction in inflation, lower inflation, inflationary expectations, forward cover, money supply, fixed exchange rates, exchange rate behavior, real ? interest rate, stable exchange rate, currency risks, nominal interest rate, currency depreciation, exchange rate system, floating exchange rate system, currency appreciation, real exchange rate appreciation, exchange rate fluctuations, exchange rate policies, average exchange rate, flexible exchange rate regimes, exchange rate arrangements

Revised System for the Classification of Exchange Rate Arrangements

Since 1998, the staff of the International Monetary Fund has published a classification of countries'' de facto exchange rate arrangements. Experience in operating this classification system has highlighted a need for changes. The present paper provides information on revisions to the system in early 2009. The changes are expected to allow for greater consistency and objectivity of classifications across countries, expedite the classification process, conserve resources, and improve transparency.Currency boards;Currency pegs;Data collection;Data quality assessment framework;Exchange rate developments;Exchange rates;Floating exchange rates;Fund role;Publications;exchange rate, foreign exchange, exchange rate arrangement, exchange rate policies, exchange rate arrangements, exchange arrangements, basket of currencies, foreign currency, inflation, monetary policy, foreign exchange market, classification of exchange rate, exchange market intervention, exchange rate regime, exchange restrictions, market exchange rate, exchange rate rules, floating exchange rate, effective exchange rate, exchange rate volatility, exchange policy, exchange rate mechanism, inflation target, multiple currency practices, exchange rate pressures, exchange rate path, exchange rate stability, exchange rate regimes, exchange rate movement, fixed exchange rate, exchange rate variability, exchange rate policy, specific exchange rate path