Capital Controls During Financial Crises: The Case of Malaysia and Thailand

38 Pages Posted: 23 Oct 2000

See all articles by Hali J. Edison

Hali J. Edison

International Monetary Fund (IMF) - Research Department

Carmen Reinhart

Harvard University - Center for Business and Government; Centre for Economic Policy Research (CEPR); World Bank; University of Maryland - School of Public Affairs; National Bureau of Economic Research (NBER); International Monetary Fund (IMF); Peterson Institute for International Economics; Harvard University, Harvard Kennedy School (HKS), Belfer Center for Science and International Affairs (BCSIA) ; Harvard University - Harvard Kennedy School (HKS)

Date Written: March 2000

Abstract

This study examines the impact capital controls had in Malaysia (1998-1999) and Thailand (1997). We aim to assess the extent to which the capital controls were effective in delivering the outcomes that motivated their imposition. We conclude that in Thailand the controls did not deliver much of what was intended - although, one does not observe the counterfactual. By contrast, in the case of Malaysia the controls did align closely with the priors of what controls are intended to achieve: greater interest rate and exchange rate stability and more policy autonomy.

Keywords: capital controls, capital flows, financial crises, asian currency crisis, cross-border volatility

JEL Classification: F21, F32

Suggested Citation

Edison, Hali J. and Reinhart, Carmen and Reinhart, Carmen and Reinhart, Carmen and Reinhart, Carmen and Reinhart, Carmen and Reinhart, Carmen and Reinhart, Carmen and Reinhart, Carmen, Capital Controls During Financial Crises: The Case of Malaysia and Thailand (March 2000). Available at SSRN: https://ssrn.com/abstract=231951 or http://dx.doi.org/10.2139/ssrn.231951

Hali J. Edison (Contact Author)

International Monetary Fund (IMF) - Research Department ( email )

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Carmen Reinhart

Centre for Economic Policy Research (CEPR)

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World Bank ( email )

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Harvard University - Center for Business and Government ( email )

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Harvard University, Harvard Kennedy School (HKS), Belfer Center for Science and International Affairs (BCSIA) ( email )

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