Capital Account Liberalization Debates


 Abstract: The case for capital account liberalization has been the centre of outgoing debate. This paper discusses both short term and longer flows (FDI). is divided into 5 sections. Section 1 presents claims neoclassical economists who believe that free trade same as liberalization. They further point out such increases social welfare promotes efficiency. 2 provides critique classical view several assumptions made in traditional theory may not hold real life. 3 empirical evidence to claim lead instability culminate a crisis. 4 explores effects FDI on countries concludes unrestricted always benefit nations. analyses empirically effect inequality, long economic growth.