{"id":11780,"date":"2012-03-09T13:16:37","date_gmt":"2012-03-09T18:16:37","guid":{"rendered":"https:\/\/www.bu.edu\/pardee\/?p=11780"},"modified":"2016-08-30T10:29:24","modified_gmt":"2016-08-30T14:29:24","slug":"experts-discuss-pardee-task-force-report-on-capital-controls-at-pardee-house-seminar","status":"publish","type":"post","link":"https:\/\/www.bu.edu\/pardee\/2012\/03\/09\/experts-discuss-pardee-task-force-report-on-capital-controls-at-pardee-house-seminar\/","title":{"rendered":"Experts Discuss Pardee Task Force Report on Capital Controls at Pardee House Seminar"},"content":{"rendered":"

\"DSC_0369\"<\/a><\/p>\n

Approximately 100 Boston university students, faculty, and other guests attended the Pardee Seminar held on March 8 that introduced the new Pardee Center Task Force Report titled Regulating Global Capital Flows for Long-Run Development.<\/em><\/a><\/p>\n

<\/em><\/p>\n

The seminar was organized by Pardee Faculty Fellow Kevin Gallagher<\/a>, co-chair of the Task Force that produced the repor<\/a>t. Other speakers included Task Force Co-Chair Prof. Jos\u00e9 Antonio Ocampo <\/a>(Initiative for Policy Dialogue, Columbia University and former Finance Minister of Colombia) and Task Force member Prof. Ilene Grabel (Korbel School of International Studies, University of Denver).<\/p>\n

All three speakers are participating in a similar presentation on the same topic at a session of the Eastern Economic Association meeting in Boston on March 9.<\/p>\n

The panel presented highlights from the report, which includes essays by more than a dozen leading scholars and economists who suggest that in the wake of the 2008 financial crisis, some form of capital account management or regulation is both necessary and desirable. The report includes a close look at the experience of countries that have already employed various forms of controls on capital flowing into and out of their economies, and calls on international financial institutions to support the expanded use of such tools by developing countries.<\/p>\n

All three speakers discussed the need for regulations on flows of capitals between developed and developing countries to help prevent the short-term, speculative investments leading to \u201cboom and bust\u201d cycles that have wreaked havoc on the economies of developing countries and limited their ability to make long-term economic progress.\u00a0 Over the past 30 years or so, the International Monetary Fund (IMF) and other international financial institutions have actively discouraged any regulations on cross-board capital flows, such as special taxes on foreign investment or setting requirements for a minimum amount of time a foreign investment must remain in a country. In addition, many free trade agreements and bilateral trade agreements \u2013 especially those involving the United States \u2013 include specific provisions prohibiting the countries involved from using such financial tools.<\/p>\n

Prof. Gallagher noted the charter of the IMF, which was founded 65 years ago, specifically includes a provision allowing countries to implement regulations on the flows of capital into and out their economies from outside of their borders. It worked well until about the mid-1980s, he said.<\/p>\n

Prof. Ocampo said that when countries use typical financial tools to address domestic issues \u2013 such as raising interest rates to slow domestic spending \u2013 it can create a spike in short-terms foreign investments, leading to a counter-productive boom-and-bust cycle. \u00a0Countries that have employed capital account regulations in such situations have shown that such regulations help to lessen the volatility.\u00a0\u00a0 Cross-board capital flows have become \u201ca normal type of finance that has generated problems and need to be regulated like other types of finance,\u201d he said.<\/p>\n

Prof. Grabel said that the \u201csilver lining\u201d of the financial crisis may be that policy makers in several developing countries have experimented with various forms of capital account regulations, with positive results.\u00a0 This allows other countries \u2013 and international financial institutions \u2013 to see how such measures can be beneficial.\u00a0 \u201cWe\u2019re now seeing capital controls as part of the (financial) policy toolkit, and it is becoming easier for other countries\u201d to adopt such measures, she said. Still, she said, \u201cwe need recognition that developing countries have the right to experiment\u201d with capital controls.<\/p>\n

The Pardee Task Force Report is part of the Pardee Center\u2019s Global Economic Governance Initiative<\/a> led by Prof. Gallagher.\u00a0 The Task Force that produced the report was co-sponsored by the Initiative for Policy Dialogue at Columbia University and the Global Development and Environment Institute at Tufts University.<\/p>\n

For a video recording of the event visit our multimedia page here.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Approximately 100 Boston university students, faculty, and other guests attended the Pardee Seminar held on March 8 that introduced the new Pardee Center Task Force Report titled Regulating Global Capital Flows for Long-Run Development. The seminar was organized by Pardee Faculty Fellow Kevin Gallagher, co-chair of the Task Force that produced the report. Other speakers […]<\/p>\n","protected":false},"author":3069,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[5355,60],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/posts\/11780"}],"collection":[{"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/users\/3069"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/comments?post=11780"}],"version-history":[{"count":10,"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/posts\/11780\/revisions"}],"predecessor-version":[{"id":25104,"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/posts\/11780\/revisions\/25104"}],"wp:attachment":[{"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/media?parent=11780"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/categories?post=11780"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bu.edu\/pardee\/wp-json\/wp\/v2\/tags?post=11780"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}