02189cas a2200241 a 4500 AALejournalIMF020962 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513546100 1018-5941 BD-DhAAL BD-DhAAL Pasricha, Gurnain Kaur. Estimated Policy Rules for Capital Controls / Gurnain Kaur Pasricha. Washington, D.C. : International Monetary Fund, 2020. 1 online resource (60 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper borrows the tradition of estimating policy reaction functions from monetary policy literature to ask whether capital controls respond to macroprudential or mercantilist motivations. I explore this question using a novel, weekly dataset on capital control actions in 21 emerging economies from 2001 to 2015. I introduce a new proxy for mercantilist motivations: the weighted appreciation of an emerging-market currency against its top five trade competitors. This proxy Granger causes future net initiations of non-tariff barriers in most countries. Emerging markets systematically respond to both mercantilist and macroprudential motivations. Policymakers respond to trade competitiveness concerns by using both instruments-inflow tightening and outflow easing. They use only inflow tightening in response to macroprudential concerns. Policy is acyclical to foreign debt; however, high levels of this debt reduces countercyclicality to mercantilist concerns. Higher exchange rate pass-through to export prices, and having an inflation targeting regime with non-freely floating exchange rates, increase responsiveness to mercantilist concerns. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2020/080 Full text available on IMF http://elibrary.imf.org/view/journals/001/2020/080/001.2020.issue-080-en.xml IMF e-Library