Multilateral Considerations

Author(s):  
Atish R. Ghosh ◽  
Jonathan D. Ostry ◽  
Mahvash S. Qureshi

This chapter discusses international spillovers, the multilateral impact of individual countries' policies, and the scope for international policy cooperation. Theory and empirics suggests that recipient countries would benefit from coordinating their policy responses to capital inflows. Specifically, because of spillovers of one country's measures on another, uncoordinated responses might result in barriers that—abstracting from terms of trade effects—are inefficiently high, reducing both global and recipient-country welfare. Theory also suggests that, under plausible conditions, it would be globally efficient if source and recipient countries could act “at both ends” in managing cross-border capital flows. For the recipient country, there would be a clear benefit if part of the distortive cost of capital controls could be shifted to the source country. Even though source countries might incur some economic or administrative cost in managing outflows, they would benefit from the terms of trade improvement.

1998 ◽  
Vol 37 (4I) ◽  
pp. 125-151 ◽  
Author(s):  
Mohsin S. Khan

The surge of private capital flows to developing countries that occurred in the 1990s has been the most significant phenomenon of the decade for these countries. By the middle of the decade many developing countries in Asia and Latin America were awash with private foreign capital. In contrast to earlier periods when the scarcity of foreign capital dominated economic policy-making in these countries, the issue now for governments was how to manage the largescale capital inflows to generate higher rates ofinvestrnent and growth. While a number of developing countries were able to benefit substantially from the private foreign financing that globalisation made available to them, it also became apparent that capital inflows were not a complete blessing and could even turn out to be a curse. Indeed, in some countries capital inflows led to rapid monetary expansion, inflationary pressures, real exchange rate appreciation, fmancial sector difficulties, widening current account deficits, and a rapid build-up of foreign debt. In addition, as the experience of Mexico in 1994 and the Asian crisis of 1997-98 demonstrated, financial integration and globalisation can cut both ways. Private capital flows are volatile and eventually there can be a large reversal of capital because of changes in expected asset returns, investor herding behaviour, and contagion effects. Such reversals can lead to recessions and serious problems for financial systems. This paper examines the characteristics, causes and consequences of capital flows to developing countries in the 1990s. It also highlights the appropriate policy responses for governments facing such inflows, specifically to prevent overheating of the economy, and to limit the vulnerability to reversals of capital flows.


2021 ◽  
Vol 19 (1) ◽  
Author(s):  
Ivy Lynn Bourgeault ◽  
Vivien Runnels ◽  
Jelena Atanackovic ◽  
Denise Spitzer ◽  
Margaret Walton-Roberts

Abstract Background Gender roles and relations affect both the drivers and experiences of health worker migration, yet policy responses rarely consider these gender dimensions. This lack of explicit attention from source country perspectives can lead to inadequate policy responses. Methods A Canadian-led research team partnered with co-investigators in the Philippines, South Africa, and India to examine the causes, consequences and policy responses to the international migration of health workers from these ‘source’ countries. Multiple-methods combined an initial documentary analysis, interviews and surveys with health workers and country-based stakeholders. We undertook an explicit gender-based analysis highlighting the gender-related influences and implications that emerged from the published literature and policy documents from the decade 2005 to 2015; in-depth interviews with 117 stakeholders; and surveys conducted with 3580 health workers. Results The documentary analysis of health worker emigration from South Africa, India and the Philippines reveal that gender can mediate access to and participation in health worker training, employment, and ultimately migration. Our analysis of survey data from nurses, physicians and other health workers in South Africa, India and the Philippines and interviews with policy stakeholders, however, reveals a curious absence of how gender might mediate health worker migration. Stereotypical views were evident amongst stakeholders; for example, in South Africa female health workers were described as “preferred” for “innate” personal characteristics and cultural reasons, and in India men are directed away from nursing roles particularly because they are considered only for women. The finding that inadequate remuneration was as a key migration driver amongst survey respondents in India and the Philippines, where nurses predominated in our sample, was not necessarily linked to underlying gender-based pay inequity. The documentary data suggest that migration may improve social status of female nurses, but it may also expose them to deskilling, as a result of the intersecting racism and sexism experienced in destination countries. Regardless of these underlying influences in migration decision-making, gender is rarely considered either as an important contextual influence or analytic category in the policy responses. Conclusion An explicit gender-based analysis of health worker emigration, which may help to emphasize important equity considerations, could offer useful insights for the health and social policy responses adopted by source countries.


Policy Papers ◽  
2012 ◽  
Vol 2012 (13) ◽  
Author(s):  

This is the fourth in a series of Board papers developing a comprehensive Fund view on capital flows and the policies that affect them. A first paper in December 2010 dealt with the Fund’s overall role in this area, both historically and prospectively. The second paper in March 2011 developed a framework for policy advice on managing capital inflows broadly endorsed by the Board, which constitutes a first round articulation of the Fund’s institutional views on managing capital inflows. The third paper in November 2011 examined the multilateral aspects of policies affecting capital flows, and focused mainly on source country policies. This paper covers liberalizing capital flows and the management of outflows.


2013 ◽  
Vol 3 (1) ◽  
pp. 71
Author(s):  
Dr.Sc. Vesna Georgieva Svrtinov ◽  
Dr.Sc. Riste Temjanovski

This paper analyses dynamics of various types of capital flows to emerging economies during and after the global financial crisis. The first part discusses dynamics of various types of international capital flows during the global financial crisis. The second part focuses on the regional distribution of capital inflows to emerging markets economies. The third part raises the issue of the changed pattern of foreign direct investment, observed during and after the global crisis. The fourth part discusses possible policy responses for dealing with volatile capital flows to emerging market economies.


Policy Papers ◽  
2012 ◽  
Vol 2012 (14) ◽  
Author(s):  

Liberalization of capital flows can benefit both source and recipient countries by improving resource allocation, reducing financing costs, increasing competition and accelerating the development of domestic financial systems. The empirical evidence, however, is mixed on the benefits, and it suggests that countries benefit most when they meet certain thresholds related to institutional and financial development. The principal cost of capital flow liberalization stems from the economic instability brought on by volatile capital flows. In extreme cases, sudden stops or reversals in capital inflows can trigger financial crises followed by prolonged periods of weak growth.


2016 ◽  
Vol 106 (5) ◽  
pp. 574-580 ◽  
Author(s):  
Carmen M. Reinhart ◽  
Vincent Reinhart ◽  
Christoph Trebesch

Capital flow and commodity cycles have long been connected with economic crises. Sparse historical data, however, has made it difficult to connect their timing. We date turning points in global capital flows and commodity prices across two centuries and provide estimates from alternative data sources. We then document a strong overlap between the ebb and flow of financial capital, the commodity price super-cycle, and sovereign defaults since 1815. The results have implications for today, as many emerging markets are facing a double bust in capital inflows and commodity prices, making them vulnerable to crises.


Author(s):  
G. Tunde, Monogbe ◽  
J. Emeka, Okereke ◽  
P. Ebele, Ifionu

In an attempt to attained sustainable level of economic development in a nation, empirical studies as well as financial theories posit that foreign capital inflows play a lead role. As such, this study set out to empirically investigate the extent to which foreign capital flows promotes economic development in Nigeria. Time series data between the periods 1986 to 2018 were sourced from the central bank of Nigeria statistical bulletin and world bank data based. The study proxied foreign capital flows using foreign direct investment, foreign portfolio investment, foreign aids and external borrowings which is decomposed into multilateral and bilateral loans while Human development index is used as proxy for economic development. The study further employed unit root test, co-integration test, error correction model and granger causality test to ascertain the direction of relationship. Findings reveal that of the five indices of foreign capital inflows, three (foreign  portfolio investment, foreign aids and bilateral loan) prove to be significant in promoting economic development in Nigeria, while foreign direct investment and multilateral loan are negatively  related to economic development in Nigeria. As such, the study conclude that foreign capital inflows in the form of foreign portfolio investment, foreign aids and bilateral loans are significant in boosting economic development in Nigeria. Therefore, we recommend that managers of the Nigerian economic should create an enabling financial environment as this will help in accelerating further inflows of portfolio investment and thus boost economic development in Nigeria.


2016 ◽  
Vol 60 (2) ◽  
pp. 307-320 ◽  
Author(s):  
Eunjung Lee ◽  
Marjorie Johnstone

This article critically examines the close tie between host and source countries in producing education migration. Using South Korea and Canada as a case study, our analysis illustrates how the gradual granting/limiting of citizenship to education migrants is ingrained in social policy which contributes to the nation-building of the host country while relying on ‘foreign’ income from the source country, impinging on family life (i.e. splitting family structure trans-nationally), and risking social integration. Although the actors are changed from labor migrants to education migrants the same dynamic of excluding migrants from citizenship and distinguishing worthy migrants from non-worthy migrants remains unchanged.


2002 ◽  
Vol 30 (1) ◽  
pp. 25-30
Author(s):  
Soumana Sako

The flight of human capital is a phenomenon that has been of concern to academics and development practitioners for decades. Termed the brain drain, it represents the loss of highly skilled professionals from a source country to a recipient country. Migrants leave one country for another as a result of strong attractions associated with differentials in living conditions, opportunities for professional advancement, and the existence of an environment that is conducive to peace and security. The term brain drain gained currency in the 1950s. Then it referred to emigration of scientists to the United States from countries such as Britain, Canada, and the former Soviet Union. Today, the concept is used to denote the flight of highly skilled professionals and academics from developing to developed countries.


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