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dc.contributor.authorvon Hagen, Jürgenen_US
dc.contributor.authorZhang, Haipingen_US
dc.date.accessioned2007-04-25en_US
dc.date.accessioned2010-09-01T09:47:45Z-
dc.date.available2010-09-01T09:47:45Z-
dc.date.issued2006en_US
dc.identifier.urihttp://hdl.handle.net/10419/39551-
dc.description.abstractWe develop a model of a small open economy with credit market frictions of the Holmstrom-Tirole type to analyze the consequences of capital account liberalization. We show that financial opening facilitates the inflows of cheap foreign funds and improves production efficiency. Reforms increasing labor market flexibility can further improve such efficiency gains. However, capital account liberalization also has important distributional consequences. Specifically, it may be impossible to use public transfers to fully compensate the loss of those negatively affected by capital account liberalization. This explains why financial opening often meets fierce opposition even though it leads to efficiency gains for the economy as a whole. From a practical perspective, capital controls should be lifted gradually for a smooth transition.en_US
dc.language.isoengen_US
dc.publisherZEI Bonnen_US
dc.relation.ispartofseriesZEI working paper B 01-2006en_US
dc.subject.jelE32en_US
dc.subject.jelE44en_US
dc.subject.jelF41en_US
dc.subject.ddc330en_US
dc.subject.keywordCapital account liberalizationen_US
dc.subject.keywordCapital controlsen_US
dc.subject.keywordFinancial frictionsen_US
dc.subject.keywordMacroeconomic fluctuationsen_US
dc.subject.keywordAsset price overshootingen_US
dc.subject.stwKapitalmarktliberalisierungen_US
dc.subject.stwKapitalverkehrspolitiken_US
dc.subject.stwWohlfahrtseffekten_US
dc.subject.stwKleines-offenes-Landen_US
dc.subject.stwTheorieen_US
dc.titleA welfare analysis of capital account liberalizationen_US
dc.typeWorking Paperen_US
dc.identifier.ppn527775827en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
dc.identifier.repecRePEc:zbw:zeiwps:B012006-
Appears in Collections:ZEI Working Papers, Zentrum für Europäische Integrationsforschung, Universität Bonn

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