Financing Development in the Financial Globalization: Revisiting Old Challenges in a New Context

Abstract

The growth in the international financial markets during the past decades produced several transformations of the world economy. In Latin America, these changes have been reflected in the increase in magnitude and volatility of financial flows (both banking and capital markets) and the expansion of the capital market-based financing for firms.The chapter revisits Latin American Structuralist vision on international capital flows and how this topic has been addressed by the more recent contributions from the so-called new Latin American Structuralism. By distinguishing between the domestic and international spheres we analyze the continuity and discontinuity between new structuralism, traditional structuralism and mainstream regarding to, on the domestic side, development banks and supervision of domestic interest rates, and on the international side, international loans and capital movements.