Berlin: FU Berlin, 2019, 121, XXX S.
Opinions regarding capital account openness have been undergoing changes. On the one hand, financial liberalization and integration are viewed as sources of economic growth and prosperity due to a better allocation of capital to productive uses. In addition, free capital mobility and access to foreign capital are considered to be important facilitators of investment as well as cross-border risk sharing. On the other hand, during the global financial crisis, free capital mobility was blamed for exchange rate overvaluation, overborrowing, fueling of credit booms, asset price bubbles, and sudden stops. Policymakers in emerging market economies claim that the risk of macroeconomic and financial instability increases due to large and volatile global capital flows. Chapters 1 and 2 of this dissertation analyze policies, such as capital flow management measures, monetary policy, and FX interventions, that are implemented by policymakers in emerging market economies with the aim of smoothing economic and financial fluctuations. Chapter 3 assesses the determinants of capital market integration in Europe, motivated by the benefits that cross-border capital flows can bring to economies. [...]