International Monetary Regimes
11 Pages Posted: 12 Nov 2014
International monetary relationships have been under strain in recent years. This is largely because adjustment mechanisms are asymmetric; the IMF has no means of putting pressure on countries with large current account surpluses to adjust. But such countries' accompanying capital account outflows have often had disappointing returns. So, we propose a method to impose symmetric constraints on the net capital flows both of deficit and surplus countries.
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