Iceland's capital controls
Fridrik M. Baldursson explores the effects of the economic policies prescribed by the IMF in response to the Iceland crisis. He finds that the capital controls were effective in that a gap emerged between the onshore and the offshore exchange rates; domestic interest rates did not follow foreign int...
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| Veröffentlicht in: | The 2008 global financial crisis in retrospect |
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| 1. Verfasser: | |
| Pages: | 2008 |
| Format: | UnknownFormat |
| Sprache: | eng |
| Veröffentlicht: |
2019
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Tag hinzufügen | Zusammenfassung: | Fridrik M. Baldursson explores the effects of the economic policies prescribed by the IMF in response to the Iceland crisis. He finds that the capital controls were effective in that a gap emerged between the onshore and the offshore exchange rates; domestic interest rates did not follow foreign interest rate, and the statistical properties of exchange rate movements changed when controls were imposed and no longer indicated the presence of a carry trade. However, Baldursson argues that interest rates were kept too high, higher than in Malaysia following the 1997 crisis. Hence the capital controls did not constitute a departure from more orthodox policies prescribed by the Fund during previous crises. |
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| ISBN: | 9783030123949 |