Gallagher in FT: Insufficient Capital Controls
Kevin Gallagher, Professor of Global Development Policy at the Frederick S. Pardee School of Global Studies at Boston University, said that capital controls are not enough to stem economic challenges in developing nations.
Gallagher made the argument in a Jan. 27 article in the Financial Times entitled “Capital Controls No Longer Taboo as Emerging Markets Battle Flight.”
From the text of the article:
“These countries are bleeding,” says Kevin Gallagher, a professor at Boston University and author of Ruling Capital: Emerging Markets and the Reregulation of Cross-Border Finance. “They can’t just let their [foreign exchange] reserves go on propping up their currencies when markets have already made their own decisions.”
Mr Gallagher is one of a group of academics and others who, since the global financial crisis of 2008-09, have called on EM policymakers to use capital controls when circumstances demand. Between 2010 and 2012, the IMF published guidelines for their use, a move that surprised many at the time, although Mr Gallagher says it did not mark any abrupt change in IMF thinking.
You can read the entire article here.
Gallagher co-directs the Global Economic Governance Initiative and the Global Development Policy Program. He is the author or co-author of six books. Learn more about him here.