Capital control

Capital control,

Definition of Capital control:

  1. Capital control represents any measure taken by a government, central bank, or other regulatory body to limit the flow of foreign capital in and out of the domestic economy. These controls include taxes, tariffs, legislation, volume restrictions, and market-based forces. Capital controls can affect many asset classes such as equities, bonds, and foreign exchange trades.

  2. Government policy of restricting locals from acquiring foreign assets (capital outflow) and/or restricting foreigners from acquiring local assets (capital inflow).

  3. Capital controls are established to regulate financial flows from capital markets into and out of a country's capital account. These controls can be economy-wide or specific to a sector or industry. Government monetary policy can enact capital control. They may restrict the ability of domestic citizens to acquire foreign assets, referred to as capital outflow controls, or foreigners' ability to buy domestic assets, known as capital inflow controls.

How to use Capital control in a sentence?

  1. Critics believe capital control inherently limits economic progress and efficiency, while proponents consider it prudent because they increase the economy's safety.
  2. Capital control represents any measure taken by a government, central bank, or other regulatory body to limit the flow of foreign capital in and out of the domestic economy.
  3. Capital inflow controls limit foreigners' ability to buy domestic assets.
  4. Policies may restrict the ability of domestic citizens to acquire foreign assets, referred to as capital outflow controls.

Meaning of Capital control & Capital control Definition