The policy responses to capital flows in emerging markets are multiple. However, capital inflow controls, if applied sufficiently broadly, can buttress all other policies by limiting the volume of capital inflows and address balance sheet vulnerabilities. The study analyzes the effects of...

Purpose: By reinforcing monetary policy independence, reducing international financing pressures and avoiding high-risk takings, capital controls strengthen the stability of the financial system and then reduce the volatility of capital inflows. The objective of this...