Managing Capital Flows and Exchange Rates: Perspectives from the Pacific Basin

Description

The essays in this volume examine the theoretical and policy issues associated with international capital flows and exchange rates for emerging markets in the Pacific Basin region. Emerging market countries in both Asia and Latin America offer a wide variety of examples for the comparative study of the implications of international capital flow surges and appropriate policy responses. The essays address four broad issues. First, they investigate the determinants of international capital flows, particularly the relative role of domestic and external factors in driving capital flows. Second, they inquire how predictable and contagious capital flow reversals and exchange rate crises are. Third, they explore what the domestic economic effects of capital inflows on emerging economies have been, and finally seek to suggest what are the appropriate responses by policymakers to capital inflow surges.

"This is a very timely book that brings the reader to the forefront of current research on macroeconomic policy issues in economies subject to sizable capital flows. The papers were written before the recent Asian crises but the analyses, done by top-flight experts, summarize what is known on the subject. I strongly recommend the book both to professional economists and policy makers involved with these types of countries. Although the papers do not stay away from addressing occasionally technical points, the collection has sharp focus on highly relevant policy issues." Guillermo A. Calvo, University of Maryland "A truly prescient book. With the crises in Thailand, Indonesia and Korea, Asian exchange rates and capital flows are the topics of the day. This book provides the essential background for any economist seeking to understand it." Barry Eichengreen, University of California, Berkeley "An unusually well-thought out collection of high-caliber essays on the most pressing international economic policy problem of our time. Head and shoulders above the usual conference volume." Kenneth Rogoff, Princeton University "The essays in this volume...give a comprehensive analysis of the theoretical and policy issues related to international capital flows and exchange rates for developing economies in the Pacific Basin." Macroeconomics