Capital Flight and Capital Controls in Developing Countries

by Gerald A. Epstein (Editor)

Capital flight - the unrecorded export of capital from developing countries - often represents a significant cost for developing countries. It also poses a puzzle for standard economic theory, which would predict that poorer countries be importers of capital due to its scarcity. This situation is often reversed, however, with capital fleeing poorer countries for wealthier, capital-abundant locales. Using a common methodology for a set of case studies on the size, causes and consequences of capital flight in developing countries, the contributors address the extent of capital flight, its effects, and what can be done to reverse it. Case studies of Brazil, China, Chile, South Africa, Thailand, Turkey and the Middle East provide rich descriptions of the capital flight phenomena in a variety of contexts. The volume includes a detailed description of capital flight estimation methods, a chapter surveying the impact of financial liberalization, and several chapters on controls designed to solve the capital flight problem. The first book devoted to the careful calculation of capital flight and its historical and policy context, this volume will be of great interest to students and scholars in the areas of international finance and economic development.

360 pages, Paperback

First published July 28, 2005

Reviews

[Monzenn · Rating 5 out of 5]

Partly a good summarized research on defining capital flight, and partly a support for capital controls to deter this capital flight. Whether I felt like looking for well-researched pieces (with statistical goodness), or am willing to be convinced of the merits of capital controls, this book / compilation catered to either taste.