The recent global financial crisis has shaken the confidence of developed and developing countries alike in the very blueprint of financial and macro policies that underlie the western capitalist systems. In an effort to contain the crisis from spreading, the authorities in the US and many...

This paper analyzes the joint behavior of international capital flows by foreign and domestic agents -- gross capital flows -- over the business cycle and during financial crises. The authors show that gross capital flows are very large and volatile, especially relative to net capital flows....

The current global crisis may change globalization itself, as both developed and developing countries adjust to global imbalances that contributed to the crisis. Will these changes help or hinder economic recovery and growth in South Asia? This is the focus of this paper. The three models of...

Understanding how prices and quantities affect investment demand is important in analyzing adjustment policies in many developing countries. Recent literature emphasizes that uncertainty curtails private investment, adding a risk premium - the price of waiting. Several recent empirical studies...

The author evaluates the effectiveness of policy measures adopted by Chile and Colombia, aiming to mitigate the deleterious effects of pro-cyclical capital flows. In the case of Chile, according to his Generalized Method of Moments (GMM) analysis, capital controls succeeded in reducing net...

The cost of public investment is not the value of public capital. Unlike for private investors, there is no remotely plausible behavioral model of the government as investor that suggests that every dollar the public sector spends as"investment"creates capital in an economic sense. This...

The authors examine the behavior of four major components of international capital flows in 15 developing and industrial countries. Striking differences in the behavior of the component flows arise in general specifications that allow the flows to interact. For example, the behavior of...

The author attempts to analyze whether price-based controls on capital inflows are successful in insulating economies against external shocks. He presents results from vector auto regressive (VAR) models that indicate that Chile and Colombia, countries that adopted controls on capital inflows,...

The capital flows to Central and Eastern Europe and the Former Soviet Union (CEE/FSU) represent a relatively small, albeit growing share of capital flows to developing countries. Taking all flows together, the total net flows to these 25 countries (Albania, Armenia, Azerbaijan, Belarus,...