BIS Working Papers no.92, June 2000; and in Crisis prevention and response : where do we stand with the debate on reform of the international financial architecture?
In this paper, an attempt is made to put the changing attitudes of policymakers towards international capital flows into a broader economic and historical context. The paper then goes on to suggest that policymakers today wish, on the one hand, to achieve the benefits of freer capital flows while trying to minimise the risks they pose on the other. Various suggestions for achieving the second objective are then critically evaluated. While most seem to have merit, no single suggestion would seem sufficient in itself to avoid all problems. As in many areas having to do with crisis prevention, incremental progress across a broad front would seem warranted.