The IMF and Regulation of Cross-Border Capital Flows

43 Pages Posted: 16 Dec 2014

See all articles by Adam Feibelman

Adam Feibelman

Tulane University - Law School

Date Written: December 15, 2014

Abstract

This Article examines the International Monetary Fund’s recent efforts to play an assertive regulatory role with regard to global capital flows. There is a growing consensus among scholars and policymakers that states must carefully manage capital flows and coordinate their policies for doing so, and that direct capital controls are a useful part of their policy toolkit in extreme circumstances. After many years of evolution in this direction, the Fund has become a leading proponent of this consensus, and it now views helping its members manage capital movements to be a prominent part of its post-crisis mandate. This effort has become a centerpiece of the Fund’s bilateral and multilateral surveillance. The Fund has embraced this role against a backdrop of a web of uncoordinated international trade and investment agreements that commit states to liberalize their capital account policies. There is currently no other multilateral framework designed to systematically manage global capital flows. For the foreseeable future, the Fund is in a unique position to play a productive role in helping states craft consistent approaches to capital flows and in promoting international coordination of these policies. It faces significant challenges in the effort, however, including its members’ potentially conflicting obligations under trade and investment treaties, uncertainty about the scope of its jurisdiction over capital flows, and pervasive limitations of the consultative mode of its surveillance. Thus, the Fund’s ambition to help its members manage capital flows will be an important test of its post-crisis mandate to promote global stability.

Keywords: International monetary Fund, international monetary law, IMF, capital flows, capital controls, capital movements, financial regulation, capital account

JEL Classification: B22, E44, F02, F21, F31, F32, F33, F42, G15, G18, N10, N20, O16

Suggested Citation

Feibelman, Adam, The IMF and Regulation of Cross-Border Capital Flows (December 15, 2014). Chicago Journal of International Law, Vol. 15, No. 2, 2015 Forthcoming, Tulane Public Law Research Paper No. 14-11, Available at SSRN: https://ssrn.com/abstract=2538655

Adam Feibelman (Contact Author)

Tulane University - Law School ( email )

6329 Freret Street
New Orleans, LA 70118
United States

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