Revisiting the effects of exchange and capital restrictions on trade

Abstract

This paper examines the effects of exchange and capital restrictions on trade and compares them with those associated with trade restrictions. Our main result is that capital account restrictions have large and statistically significant effects on trade flows. Such effects are smaller than those from trade restrictions, however. The effects of exchange and capital restrictions are larger for trade in goods, especially for agriculture and manufacturing, and smaller for trade in services.

Rodolfo G. Campos

Economist

My research interests include macroeconomics, social insurance, and international economics.