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International Capital Flow: Why Is Essay

Historical Trends and Developments. Eichengreen (2004) argues that there have been several major historical "regimes" that have had differentiated approaches to international capital flows. Prior to WWI, the free flow of capital across borders reached heights never seen before of since. This was followed by effort in the 1920s to establish international controls for the international flow of capital. The financial disaster of the 1930s began a period of tight regulation of international transactions. In the 1970s another period of free-flowing capital was begun, culminating in the boom of international capital flows of the 1990s (4).

In the 1990s, financial crises in Asia, Mexico, Turkey, and Russia led to a period of increased interest in international controls, as the level of global economic development was shown to be effected by problems in different regions of the world and the shockwaves these crises sent to other regions (Taskin and Muradoglu, 2003). In fact these financial shockwaves probably even served to slow growth in countries which were closely integrated into the world system (Worldbank, 2001). The recent international financial collapse and the role of leading economies such as the U.S. And the UK in causing it has sent the world economy into another round of debates about whether...

While the answer remains to be seen, modern integration of domestic economies in the global economy through such developments as multinational corporations and technology that allows global capital and stock trading at the push of a button may have sent the global economic past the brink of making a choice about whether it wants to have free flowing capital. The only relevant question now may be… how best to moderate it.
Works Cited

Eichengreen, B. (2004). Capital flows and crises. Cambridge, MA: MIT.

Feldstein, M. (1997). International capital flows. National Bureau of Economic Research. 12 December 2009. Retrieved from http://www.nber.org/feldstein/woodstock_intro.html.

Ott, M. (2008). International capital flows. Library of Economics and Liberty. 12 December 2009. Retrieved from http://www.econlib.org/index.html.

Taskin, F., and Muradoglu, G. (2003, September-December). Financial liberalisation: from segmented to integrated economies. Journal of Economics and Business, 55 (5-6): 529-555.

Worldbank. (2001). International capital flows and economic growth. www.Worldbank.org. 12 December 2009. Retrieved from http://siteresources.worldbank.org/INTGDF2001/Resources/CH3 -- 58-83.pdf.

Sources used in this document:
Works Cited

Eichengreen, B. (2004). Capital flows and crises. Cambridge, MA: MIT.

Feldstein, M. (1997). International capital flows. National Bureau of Economic Research. 12 December 2009. Retrieved from http://www.nber.org/feldstein/woodstock_intro.html.

Ott, M. (2008). International capital flows. Library of Economics and Liberty. 12 December 2009. Retrieved from http://www.econlib.org/index.html.

Taskin, F., and Muradoglu, G. (2003, September-December). Financial liberalisation: from segmented to integrated economies. Journal of Economics and Business, 55 (5-6): 529-555.
Worldbank. (2001). International capital flows and economic growth. www.Worldbank.org. 12 December 2009. Retrieved from http://siteresources.worldbank.org/INTGDF2001/Resources/CH3 -- 58-83.pdf.
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