Overview of International Capital Flows

The purpose of this book is to explore how Korea has managed international capital flows over the last two decades. Unfortunately, less than ten years after Korea had barely recovered from the aftermath of the 1997 Asian financial crisis, the country was hit by yet another crisis, the global financial crisis. There were many causes for these two crises, but international capital flows were prime among them. Therefore, a good understanding of capital flows in and out of Korea during the last two decades is essential to derive some useful lessons from Korea’s experiences. However, before exploring capital flows in Korea, we first provide an overview of international capital flows in general in order to place the Korean case in a broader context.