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The primordial function of capital account liberalization is to allow free flow of funds into and out of a country鈥檚 economy. Recent economic developments have provided alluring opportunities that induce countries to liberalize the capital accounts. There are numerous misconceptions about the benefits of enabling capital account liberalization. Among many issues capital account liberalization provides an opportunity for foreign and domestic investors to interact and in the process facilitate the development of the economy. It creates new markets and more permissive transactions in the global scene. More importantly Brandon Ingram Authentic Jersey , the openness of the cash flows provides more of indirect benefits than it does with direct benefits like creating competitiveness between countries that facilitates improvement in domestic corporate management.
The opportunity created by the liberalization of capital accounts comes along with risks. Even though capital account liberalization instigates growth in a country, the institution鈥檚 not every country can fully benefit from the openness of the financial capital. The objectives or circumstances of a country determine the reason for liberalizing the country鈥檚 accounts. There are numerous predictors of the effectiveness of the openness of the financial accounts in a country. However, the most prevalent is the capacity of the country. The ability of the country manifests in the form of assets and institutions as well as the ability to use the infrastructure to its advantage. The capacity of the country creates the difference between developing and developed countries. Developed countries are at an advantage as compared to the developing countries because of their capacity in terms of infrastructure and institutions. Nonetheless, this is not entirely true because developed countries also fall prey to inability to handle the openness succumbing to adversities such as overvaluation. Countries must create structures and also robust policies to handle the weight that comes with the openness of the financial capital. Before enabling liberalization of capital accounts, the countries should be fully prepared for capital account liberalization, reinforce their institutions to handle the liberalizing flows among others. The countries can also encouraging outflows and control private sector outflows in the early stages of liberalization.
Analysis of Article
The article fully grasps the detail about a pragmatic approach to capital account liberalization. The article diversifies the field of analysis to provide a well-versed description of the current situation. It disaggregates down all the aspects of the global market and the benefits of liberalizing the capital accounts to countries. The article also fully describes the predictors to achieving these objectives. These predictors are the structures that determine whether a country grasps the benefits that come along with liberalizing the capital accounts. The article also identifies the problems associated to liberalizing the capital accounts and also the factors that prevent countries from benefiting from its enabling. Finally, the paper offers recommendations with regards to capital account liberalization. These recommendations include the structures and procedures a country should implement to benefit from the openness.
The methodology used in the paper facilitates the representation of data in the article. The article uses a qualification research strategy to gather and analyze data and develop a theory on the pragmatic approach to capital account liberalization. The research strategy compares the parameters in the benefits, limitations and predictors to develop recommendations for successful capital account liberalization. Moreover, the author uses a chronological array of the information in the paper such that the audience can easily grasp the content in the article. The author begins with an introduction to a pragmatic approach to capital account liberalization followed by the benefits and challenges after which the article critically analyzes the predictors of success before finally providing recommendations. The author uses rational explanations while avoiding the use of jargon to ease the readability and understandability of the content and only uses terms related to the topic.

Reference
Prasad, E., & Rajan, R. (2008). A Pragmatic Approach to Capital Account Liberalization, Journal of Economic Perspectives, 22(3), 149鈥?72.


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