Global Capital Controls in the Twenty-First Century: A Hierarchical Measure of Capital Controls

36 Pages Posted: 19 Jun 2023 Last revised: 6 May 2024

See all articles by Hongfeng Peng

Hongfeng Peng

Shandong University of Finance and Economics

Wenhao Wang

Shandong University of Finance and Economics

Yanzhen Liu

Independent

Zumian Xiao

Independent

Zhichao Yin

Independent

Date Written: April 29, 2024

Abstract

In this study, we construct a set of monthly de jure indexes that measure the on-going changes in capital controls in 190 countries from 1999 to 2022. The information about policy changes on capital accounts is extracted from the International Monetary Fund’s Annual Report on Exchange Arrangement and Exchange Restrictions, and a series of hierarchical weights are employed to capture the intensities of these policy changes. The indexes show that capital controls were relaxed globally in the first two decades of the twenty-first century, and more relaxations were on capital outflows. The progress of capital account liberalization was highly different across countries in different periods.

Keywords: Capital controls; de jure indexes; hierarchical measure; IMF AREAER

JEL Classification: F15, F38, F43

Suggested Citation

Peng, Hongfeng and Wang, Wenhao and Liu, Yanzhen and Xiao, Zumian and Yin, Zhichao, Global Capital Controls in the Twenty-First Century: A Hierarchical Measure of Capital Controls (April 29, 2024). Available at SSRN: https://ssrn.com/abstract=4477504 or http://dx.doi.org/10.2139/ssrn.4477504

Hongfeng Peng

Shandong University of Finance and Economics ( email )

Wenhao Wang (Contact Author)

Shandong University of Finance and Economics ( email )

China

Yanzhen Liu

Independent ( email )

Zumian Xiao

Independent

Zhichao Yin

Independent

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