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Financial Flows to Emerging Economies and Policy Alternatives Post 2008

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Financial Deepening and Post-Crisis Development in Emerging Markets

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Abstract

Cross-border capital flows have been intensified in the last decades with the greater financial integration. Along with their greater size, gross flows have become more volatile and pro-cyclical, exacerbating economic fluctuations in emerging-markets economies (EMEs). After the 2008 global crisis, “emerging-market” assets and currencies became objects of desire on the part of global investors, resuming policy dilemmas to EMEs stemming from the combination of high growth rates, accelerating inflation, excessive currency appreciation, and/or asset price overshooting. Yet, some EMEs chose to regulate capital inflows in order to deal with these policy dilemmas. This chapter aims at analyzing some macroeconomic problems related to the recent wave of capital flows to EMEs and discussing some policies alternatives to deal with such issues, with special focus on capital account regulation.

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Author information

Authors and Affiliations

  1. Professor of Economics at the University of the State of Rio de Janeiro (UERJ), Rio de Janeiro, Brazil

    Luiz Fernando de Paula

  2. Professor of Economics at the State University of Campinas (UNICAMP), Rio de Janeiro, Brazil

    Daniela Magalhães Prates

Authors
  1. Luiz Fernando de Paula
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  2. Daniela Magalhães Prates
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Editor information

Editors and Affiliations

  1. St. John's University, Queens, New York, USA

    Aleksandr V. Gevorkyan

  2. World Bank, Potomac, Maryland, USA

    Otaviano Canuto

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de Paula, L.F., Prates, D.M. (2016). Financial Flows to Emerging Economies and Policy Alternatives Post 2008. In: Gevorkyan, A., Canuto, O. (eds) Financial Deepening and Post-Crisis Development in Emerging Markets. Palgrave Macmillan, New York. https://doi.org/10.1057/978-1-137-52246-7_5

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