The Influence Of Capital Account Liberalization On Financial System

The experiences with capital account liberalization from Latin America and Asia have been paid great attention to in academic circles and international society over the past three decades. As far as the effects of capital account liberalization are concerned, the economists have not been agreement. According to the experiences with capital account liberalization in different countries, capital account liberalization and capital inflows surging in developing countries can promote the financial development; meanwhile the economy in developing countries faces more and more indefinitude. The Asian financial crisis in 1997,the financial turbulence in Brazil and Russia in 1998,the financial crisis in Argentine in 2001,and the financial crises occurred in emerging market countries more frequently, seem to prove that, the stability of financial system in quite a few countries faces severe challenge, accompanying with the process of capital account liberalization. Then, how could developing countries carry out the progress of capital account liberalization to ensuring the financial system stability? This is the question that this article attempts to reply to.This article includes four parts. The main contents are as following:The first part is introduction that introduces the aim of the study and the summaries of relative literatures. Since 1980s,the experiences with capital account liberalization from developing countries and frequent occurrences of financial crises have made the financial stability in the process of capital account liberalization a significant problem. A large quantity mass of literatures indicates that it doesn?ˉt exist an identical conclusion about the influence of capital account liberalization on the financial system. Some of them support that capital account liberalization benefits the development of financial system, while someone points that capital account liberalization aggravate the financial system instability. Therefore, the relations between capital account liberalization and financial system stability are indefinite.The second part probes the correlation between capital account liberalization and financial system with the theoretical and empirical studies. Theoretically speaking, the influence of capital account liberalization on the...