Skip to main content
    • Aa
    • Aa
  • Get access
    Check if you have access via personal or institutional login
  • Cited by 46
  • Cited by
    This article has been cited by the following publications. This list is generated based on data provided by CrossRef.

    Albertus, Michael and Menaldo, Victor 2016. Capital in the Twenty-First Century—in the Rest of the World. Annual Review of Political Science, Vol. 19, Issue. 1, p. 49.

    Hartmann, Christof 2016. Leverage and linkage: how regionalism shapes regime dynamics in Africa. Zeitschrift für Vergleichende Politikwissenschaft, Vol. 10, Issue. S1, p. 79.

    Agnello, Luca Castro, Vitor Jalles, João Tovar and Sousa, Ricardo M. 2015. What determines the likelihood of structural reforms?. European Journal of Political Economy, Vol. 37, p. 129.

    Gallagher, Kevin P. 2015. Countervailing monetary power: Re-regulating capital flows in Brazil and South Korea. Review of International Political Economy, Vol. 22, Issue. 1, p. 77.

    Guisinger, Alexandra and Brune, Nancy E. 2014. The Diffusion of Financial Liberalization in Developing Countries. Foreign Policy Analysis, p. n/a.

    Labaqui, Ignacio 2014. The Financial Statecraft of Emerging Powers.

    Moore, Winston 2014. MANAGING THE PROCESS OF REMOVING CAPITAL CONTROLS: WHAT DOES THE LITERATURE SUGGEST?. Journal of Economic Surveys, Vol. 28, Issue. 2, p. 209.

    Mukherjee, Bumba Yadav, Vineeta and Bejar, Sergio 2014. Candidate-centred systems, public banks and equity market restrictions in developing democracies. Review of International Political Economy, Vol. 21, Issue. 3, p. 670.

    Chwieroth, Jeffrey M. and Sinclair, Timothy J. 2013. How you stand depends on how we see: International capital mobility as social fact. Review of International Political Economy, Vol. 20, Issue. 3, p. 457.

    Moore, Winston 2013. Quantifying the effects of capital controls in small states. Macroeconomics and Finance in Emerging Market Economies, Vol. 6, Issue. 2, p. 190.

    Mukherji, Rahul 2013. Ideas, interests, and the tipping point: Economic change in India. Review of International Political Economy, Vol. 20, Issue. 2, p. 363.

    Pepinsky, Thomas B. 2013. The domestic politics of financial internationalization in the developing world. Review of International Political Economy, Vol. 20, Issue. 4, p. 848.

    Quinn, D.P. Schindler, M. and Toyoda, A.M. 2013. The Evidence and Impact of Financial Globalization.

    PEPINSKY, THOMAS B. 2012. Do Currency Crises Cause Capital Account Liberalization?1. International Studies Quarterly, Vol. 56, Issue. 3, p. 544.

    Reeves Knyght, Philip Kakabadse, Nada K. Kouzmin, Alexander and Kakabadse, Andrew 2011. Chronic limitations of neo‐liberal capitalism and oligopolistic markets. Society and Business Review, Vol. 6, Issue. 1, p. 7.

    SHENG, LI 2011. Theorising free capital mobility: the perspective of developing countries. Review of International Studies, Vol. 37, Issue. 05, p. 2519.

    Urpelainen, Johannes 2011. Early birds: Special interests and the strategic logic of international cooperation. The Review of International Organizations, Vol. 6, Issue. 2, p. 113.

    Mosley, Layna 2010. Regulating globally, implementing locally: The financial codes and standards effort. Review of International Political Economy, Vol. 17, Issue. 4, p. 724.

    Mukherjee, Bumba and Singer, David Andrew 2010. International Institutions and Domestic Compensation: The IMF and the Politics of Capital Account Liberalization. American Journal of Political Science, Vol. 54, Issue. 1, p. 45.

    Gates, Leslie C. 2009. Theorizing business power in the semiperiphery: Mexico 1970-2000. Theory and Society, Vol. 38, Issue. 1, p. 57.


The political economy of financial internationalization in the developing world


In the last decade a growing number of developing countries have opened their financial systems by liberalizing capital flows and the rules governing the international operations of financial intermediaries. One explanation of this rush toward greater financial internationalization is that increasing interdependence generates domestic and foreign political pressures for capital account liberalization. While we find evidence for that hypothesis, we find that the proximate cause in developing countries more frequently is found in balance of payments crises. Politicians perceive that financial openness in the face of crisis can increase capital inflows by indicating to foreign investors that they will be able to liquidate their investments and by signaling government intentions to maintain fiscal and monetary discipline. The argument is explored through case studies of Chile, Indonesia, Mexico, and South Korea.

Linked references
Hide All

This list contains references from the content that can be linked to their source. For a full set of references and notes please see the PDF or HTML where available.

Alberto Alesina , Vittorio Grilli , and Gian Maria Milesi-Feretti . 1993. The political economy of capital controls. Working paper no. 4353, National Bureau of Economic Research, Cambridge, Mass.

David M. Andrews 1994. Capital mobility and state autonomy: Toward a structural theory of international monetary relations. International Studies Quarterly 38:193218.

Vittorio Corbo , and Jaime de Melo . 1985. Liberalization with stabilization in the Southern Cone of Latin America: Overview and summary. World Development 13:863–66.

Vittorio Corbo , and Jaime de Melo . 1987. Lessons from the Southern Cone policy reforms. World Bank Research Observer 2:111–42.

Sebastian Edwards , and Sweder van Wijnbergen . 1986. The welfare effects of trade and capital market liberalization. International Economic Review 27:141–48.

Paul Krugman . 1979. A model of balance of payments crises. Journal of Money, Credit, and Banking 11:311–25.

Paulette Kurzer . 1991. Unemployment in open economies: The impact of trade, finance, and European integration. Comparative Political Studies 24:330.

Dani Rodrik . 1989. Promises, promises: Credible policy reform via signaling. Economic Journal 99:756–72.

Nouriel Roubini , and Xavier Sala-i-Martin . 1992. Financial repression and economic growth. Journal of Development Economics 39:531.

Recommend this journal

Email your librarian or administrator to recommend adding this journal to your organisation's collection.

International Organization
  • ISSN: 0020-8183
  • EISSN: 1531-5088
  • URL: /core/journals/international-organization
Please enter your name
Please enter a valid email address
Who would you like to send this to? *