The paper aims at a conceptual contribution to the normative economic analysis of rural de-velopment (RD) policies. RD is regarded as a problem of interaction between individuals; (lacking) structural change or the (missing) integration of externalities are therefore recon-structed as...

This paper argues that, in improving the efficient allocation of resources, financial sector development could dampen the appreciation effect of capital inflows. Using dynamic panel data techniques, the paper finds that the exchange rate appreciation effect of FDI inflows is indeed attenuated...

While new conventional wisdom warns that developing countries should be aware of the risks of premature capital account liberalization, the costs of not removing exchange controls have received much less attention. This paper investigates the negative effects of exchange controls on trade. To...

This paper discusses the forces driving capital flows in the transition countries of Central and Eastern Europe (CEE). It argues that various influences—specifically, the real exchange rate history and trend and the factor intensity of production—can combine to motivate very large capital...

This paper outlines a “modern” approach to managing risks in cross-border capital movements that is consistent with an environment of increased and liberalized capital flows. Key elements of this approach include: a consistent monetary and exchange rate policy mix to avoid incentives for...

This is the chartbook of individual country exchange rate histories and their experience with parallel markets, 1946-2001 that accompanies "The Modern History of Exchange Rate Arrangements: A Reinterpretation." We develop a novel system of reclassifying historical exchange rate regimes. One key...

There are cases where the parallel (or secondary) exchange rate applies only to a few limited transactions. An example is the “switch pound” in the United Kingdom during September 1950 through April 1967. However, it is not unusual for dual or parallel markets (legal or otherwise) to account...

This paper examines the macroeconomic implications of, and policy responses to surges in private capital inflows across a large group of emerging and advanced economies. In particular, we identify 109 episodes of large net private capital inflows to 52 countries over 1987-2007. Episodes of large...

This study shows that in Mexico there is a long-run relationship between the real exchange rate and capital inflows, the external terms of trade, and productivity in the manufacturing sector. A once-and-for-all unit increase in the ratio of quarterly capital inflow to quarterly (annualized) GDP...

In the past decade, most of the EU New Member States experienced a severe credit-boom bust cycle. This paper argues that the credit boom-bust cycle was to a large extent the result of factors external to the region (“bad luckâ€). Rapid credit growth followed from a high liquidity in...