Journal of Economic Literature
Book Reviews
2026-09-01
Jay C. Shambaugh of Dartmouth College and NBER reviews “Capital Controls and Capital Flows in Emerging Economies: Policies, Practices, and Consequences” by Sebastian Edwards,. The EconLit Abstract of the reviewed work begins “Fourteen papers and nine comments, originally presented at a conference held in Santa Barbara in December 2004, examine the advantages and pitfalls of restricting capital mobility in developing countries. Papers discuss capital flows in a globalized world--the role of policies and institutions; capital controls, sudden stops, and current account reversals; currency mismatches, debt intolerance, and original sin--why they are not the same and why it matters; the microeconomic evidence on capital controls--no free lunch; the international exposure of U.S. banks--Europe and Latin America compared; international borrowing, capital controls, and the exchange rate--lessons from Chile; international borrowing and macroeconomic performance in Argentina; capital flows and controls in Brazil--what we have learned; the Chinese approach to capital inflows--patterns and possible explanations; South Korea's experience with international capital flows; Malaysian capital controls--macroeconomics and institutions; capital flows and exchange rate volatility--Singapore's experience; India's experience with capital flows--the elusive quest for a sustainable current account deficit; and capital controls--an evaluation. Edwards is Henry Ford II Professor of International Business Economics at the Anderson Graduate School of Management at the University of California at Los Angeles and Research Associate at the National Bureau of Economic Research. Author and subject indexes.”