Financialization and Economic Policy: The Issue of Capital Control in the Developing Countries

Research output: Contribution to journalArticle

Abstract

In analysing the availability and performance of the foreign capital in developing countries too much attention has been given to the availability of capital and current account whilst far too little has been given to long-term investment, job creation and economic sovereignty. The current study centres on a critical review of available literature and a contribution to the substantive topics indicated in the title. The objective is to examine relevant empirical and theoretical studies. The study argues that following the adoption of capital liberalisation and neoliberalism, the economies of most developing countries have become more vulnerable. If China is excluded, we find that most developing economies have been unable to expand employment opportunities or reduce levels of poverty due to fear of capital flight. In recent years capital liberalisation policy has encouraged capital flight from their economies. After 2008, the IMF publicly express support for capital controls as a result of the global financial crisis and as the vulnerabilities associated with capital flows.
LanguageEnglish
Pages564-589
Number of pages26
JournalWorld Review of Political Economy
Volume8
Issue number4
DOIs
Publication statusPublished - 5 Dec 2017

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Liberalization
Economic policy
Financialization
Developing countries
Capital controls
Capital flight
Economics
China
Vulnerability
Poverty
Global financial crisis
Neoliberalism
Developing economies
Current account
Capital account
Sovereignty
Foreign capital
Job creation
Capital flows

Cite this

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title = "Financialization and Economic Policy: The Issue of Capital Control in the Developing Countries",
abstract = "In analysing the availability and performance of the foreign capital in developing countries too much attention has been given to the availability of capital and current account whilst far too little has been given to long-term investment, job creation and economic sovereignty. The current study centres on a critical review of available literature and a contribution to the substantive topics indicated in the title. The objective is to examine relevant empirical and theoretical studies. The study argues that following the adoption of capital liberalisation and neoliberalism, the economies of most developing countries have become more vulnerable. If China is excluded, we find that most developing economies have been unable to expand employment opportunities or reduce levels of poverty due to fear of capital flight. In recent years capital liberalisation policy has encouraged capital flight from their economies. After 2008, the IMF publicly express support for capital controls as a result of the global financial crisis and as the vulnerabilities associated with capital flows.",
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Financialization and Economic Policy : The Issue of Capital Control in the Developing Countries. / Siddiqui, Kalim.

In: World Review of Political Economy, Vol. 8, No. 4, 05.12.2017, p. 564-589.

Research output: Contribution to journalArticle

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