NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

On the International Financial Architecture: Insuring Emerging Markets

Ricardo J. Caballero

NBER Working Paper No. 9570
Issued in March 2003
NBER Program(s):   CF   EFG   IFM

In spite of significant institutional and macroeconomic reforms over the last decade or two, capital flows to developing economies remain highly volatile. In 1996, net private capital flows to emerging markets reached US$230 billions; by 1997 these flows had been cut in half; by 1998 halved again; and after a mild recovery during 1999, flows fell in 2000 and 2001 to slightly over one-tenth the level of 1996. These reversals in capital flows have enormous economic and social costs for developing economies. For well behaved' countries, a significant share of these fluctuations is triggered by events that are outside their direct control, and often outside the control of emerging markets as a whole. Building on this observation, this paper highlights some of the desirable features of insurance and hedging instruments against capital flow volatility, and discusses steps to facilitate the creation of these markets.

download in pdf format
   (217 K)

email paper

This paper is available as PDF (217 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w9570

Published: Caballero, Ricardo J. “On the International Financial Architecture: Insuring Emerging Markets," Journal of Financial Transformation, (The Capco Institute), 7: 8-12, March 2003 citation courtesy of

Users who downloaded this paper also downloaded these:
Aizenman, Chinn, and Ito w14533 Assessing the Emerging Global Financial Architecture: Measuring the Trilemma's Configurations over Time
Stiglitz w15718 Risk and Global Economic Architecture: Why Full Financial Integration May Be Undesirable
Goldstein An Evaluation of Proposals to Reform the International Financial Architecture
Fischer w9297 Financial Crises and Reform of the International Financial System
Aizenman w13277 Large Hoarding of International Reserves and the Emerging Global Economic Architecture
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us