During the past two years Latin America has received sizable international capital inflows. This paper compares the recent experience with that of the late 1970s. The analysis examines differences and similarities between the two episodes in three broad areas: domestic macroeconomic conditions...

The Mexican, Asian, and Russian crises of the mid- and late 1990s have renewed interest among policymakers in the determinants and effects of private capital inflows. This paper analyzes whether policies can affect the composition of capital inflows and whether different compositions aggravate...

A bivariate vector-autoregression (VAR) model is used to test causal relations between the current account and the capital account in four emerging market economies. The results show that high capital mobility could be a major cause of current account instability. Therefore, macroeconomic policy...