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The Practice of Cross-Border Capital Flow Management Framework in Emerging Market Economies and Its Implications for China's Financial Opening-Up

Huifang Shi


After entering the era of globalization, the procyclical fluctuation characteristics of cross-border capital flows have brought great challenges to the macroeconomic and financial stability of various countries. However, there is still a lack of quantitative research support on how to design and implement more effective cross-border capital flow management policies for emerging market economies and the international community. This paper selected panel data samples of 16 emerging market economies from the first quarter of 2001 to the fourth quarter of 2012, incorporated panel data fixed effect model and Logit fixed effect model, and found through empirical analysis based on the research of Ghosh et al. (2017), Emerging market economies have been actively using policy tools to manage capital flows counter-cyclically after the financial crisis. At the same time, the intensity of implementation of traditional macroeconomic policies and non-traditional instruments is different due to capital flow, capital type and national income level.


Cross-Border Capital Flow; Macroprudential; Capital Control

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Ahmed S. and Zlate A. 2014. Capital flows to emerging market economies:a brave new world? Journal of International Money and Finance, 48, 221-248.

Akinci O, and Olmstead-Rumsey J, 2015, “How Effective are Macroprudential Policies? An Empirical Investigation,” International Finance Discussion Papers No. 1136(Washington D.C.: Federal Reserve Board).

Ghosh AR, Ostry JD and Qureshi MS. 2017a. Managing the tide: How do emerging markets respond to capital flows? IMF Working Paper No.17/69.

DOI: http://dx.doi.org/10.18686/fm.v8i2.6760