We provide a conceptual and empirical framework for evaluating the effects of short-term capital flows. A simple model … short-term exposure is associated with more severe crises when capital flows reverse. Higher levels of M2/GDP and per … driving short-term capital flows. Our policy analysis focuses on ways in which potential illiquidity can be avoided …

We provide a conceptual and empirical framework for evaluating the effects of short-term capital flows. A simple model … short-term exposure is associated with more severe crises when capital flows reverse. Higher levels of M2/GDP and per … driving short-term capital flows. Our policy analysis focuses on ways in which potential illiquidity can be avoided …