Join the City Political Economy Research Centre (CITYPERC) for a critical discussion of central banks, fiscal policy and capital controls.
Speaker: Inga Rademacher, City, University of London
Abstract
A recent finding of comparative political economy (CPE) scholarship is that capital controls were liberalised more unevenly than conventionally assumed. Some advanced market economies liberalised all controls in the 1970s, but others retained some controls well into the 1990s.
So far, explanations have highlighted dominant economic interests (exporters or financial markets), while intrinsic, institutional preferences and strategies of state actors have been neglected.
Based on archival material and a historical comparison of Germany and the UK (1961-1985), this article finds that central bank experiences with the fiscal sphere critically shaped capital control outcomes. Because the Bundesbank had the capacity to discipline fiscal outcomes, central bankers accepted controls as a panacea to restore price stability as capital mobility increased.
Bank of England officials did not hold institutional capacities to shape fiscal outcomes and, thus, came to reject capital controls as tools governments use to protect the fiscal sphere.
About the speaker
Inga Rademacher is a lecturer in International Political Economy at City, University of London.
She holds a PhD from the Max Planck Institute of the Study of Societies in Cologne and has held previous positions at King's College and Goldsmiths, University of London.
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