Which of the following is a controversial proposal for reducing the frequency of financial crises?
A)Countries should pursue sound macroeconomic policies.
B)Countries should improve the quality and timeliness of the data they report on their international reserves and debt.
C)Developing countries should increase the use of controls or impediments to capital inflows.
D)Countries should strive for better supervision and regulation of their banks.

Question

Quizplus · Accepted Answer

Developing countries increasing the use of controls or impediments to capital inflows is controversial because it restricts the free flow of capital and can potentially limit economic growth and development in those countries. While some argue that these controls can protect against financial instability and crises, others argue that they can do more harm than good. The other options (A, B, and D) are generally accepted as important measures to reduce the frequency of financial crises.

Which of the Following Is a Controversial Proposal for Reducing