This paper deals with two related issues: the sustainability of China's exchange rate regime and the opening up of its capital account. The exchange rate discussion deliberately passes over the issue of the quot;equilibriumquot; value of the renminbi and its alleged undervaluation - typically at...

This paper reviews the experience with capital controls in industrial and developing countries, considers the policy issues raised when the effectiveness of capital controls diminishes, examines the medium-term benefits and costs of an open capital account, and analyzes the policy measures that...

This paper investigates the extent to which financial markets in the Pacific Basin Region have become more integrated, by analyzing the comovements of real interest rates. The paper uses cointegration and error correction models and draws inferences on the degree of capital market integration by...

This study analyzes structural changes in the determinants of private sector capital flows that resulted from the reforms both in the domestic financial market and in the external capital account of Finland during the 1980s and early 1990s. A Kouri-Porter type of model of the capital account is...

This paper provides a consistent theoretical framework to explain the fundamental determinants of the evolution in the medium to longer run of the real effective exchange rate of the United States relative to the currencies of the other G-7 countries. The fundamental determinants are...

The economic events of 2016 taught us a lot of hard lessons about Nigeria's interface with the global economy, and the links with domestic growth, stability and policy responses. This paper attempts to distill some of the lessons and clarify the outlook.Weak commodity prices brought Nigeria's...

The assessment of external positions and exchange rates is a key mandate of the IMF. This paperpresents the updated External Balance Assessment (EBA) framework-a key input in the conduct ofmultilaterally-consistent external sector assessments of 49 advanced and emerging marketeconomies-following...

This paper studies the effect of demographic change on national saving, global interest rates, and international capital flows, focusing on the role of the public pension system. We develop a small open economy overlapping generations model to illustrate the channels through which demographic...

This paper argues that conventional tests of financial market integration may be misleading because they neglect to consider two important issues: (i) testing the existence of transaction costs and (ii) testing the existence of structural change. While the existence of transaction costs may...

Investments on the capital market depends on the current political situation of the country, as well as on the movements of the global economy. In countries with unstable political situation, the performance of the stock exchange declines, unlike politically stable countries, where stock...