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Financial Markets Volatility and Performance in Emerging Markets

Capital mobility is a double-edged sword for emerging economies, as governments must weigh the benefits of investment against the potential economic costs and political consequences of currency crises, devaluations, and instability. Financial Markets Volatility and Performance in Emerging Markets addresses the delicate balance between capital mobility and capital controls as developing countries navigate the convoluted global network of private investors, hedge funds, large corporations, and international institutions such as the International Monetary Fund.
            A group of experts here examine rapidly globalizing financial markets with regard to capital flows and crises, domestic credit, international financial integration, and economic policy. Featuring detailed analyses and cross-national comparisons of countries such as Brazil, Argentina, Uruguay, and Korea, this book will shape economists’ and policymakers’ understanding of the effectiveness of restrictions on capital mobility in the world’s most fragile economies. 

Table of Contents


     Sebastian Edwards and Márcio G. P. Garcia

1.  Links between Trade and Finance: A Disaggregated Analysis
     Joshua Aizenman and Ilan Noy
     Comment: Maria Cristina Terra
     Comment: Thierry Verdier

2.   Ineffective Controls on Capital Inflows under Sophisticated Financial Markets: Brazil in the Nineties
     Bernardo S. de M. Carvalho and Márcio G. P. Garcia
     Comment: Gustavo H. B. Franco
     Comment: Marcelo Abreu

3.  Financial Openness, Currency Crises, and Output Losses
     Sebastian Edwards
     Comment: Edmar L. Bacha
     Comment: Marcelo Kfoury Muinhos

4.  Capital Market Development: Whither Latin America?
     Augusto de la Torre, Juan Carlos Gozzi, and Sergio L. Schmukler
     Comment: Ugo Panizza

5.  Judicial Risk and Credit Market Performance: Micro Evidence from Brazilian Payroll Loans
     Ana Carla A. Costa and João M. P. De Mello
     Comment: Renato G. Flôres Jr.

6.  Liquidity Insurance in a Financially Dollarized Economy
     Eduardo Levy Yeyati
     Comment: Marco Bonomo
     Comment: Alejandro Werner

7.  Sudden Stops and IMF-Supported Programs
     Barry Eichengreen, Poonam Gupta, and Ashoka Mody
     Comment: Ilan Goldfajn

8.  Mutual Reinforcement: Economic Policy Reform and Financial Market Strength
     Anne O. Krueger

     Author Index
     Subject Index

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