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Why were capital controls abandoned? The case of Britain’s abolition of exchange controls, 1977-9
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Copley, Jack (2019) Why were capital controls abandoned? The case of Britain’s abolition of exchange controls, 1977-9. British Journal of Politics and International Relations, 21 (2). pp. 403-420. doi:10.1177/1369148118819687 ISSN 1369-1481.
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Official URL: https://doi.org/10.1177/1369148118819687
Abstract
This article examines the politics of capital control liberalisation through an archival analysis of Britain’s exchange controls abolition. While the political economy consensus states that capital controls were abandoned because of a desire to boost the competitiveness of national financial centres and the ascendance of laissez-faire ideas, this article will challenge this interpretation. The James Callaghan and Margaret Thatcher governments were concerned by the worsening performance of British industrial exporters, and exchange control abolition constituted a strategy to depreciate sterling and thus boost export competitiveness. Yet this beggar-thy-neighbour strategy risked spooking global markets and provoking a run on sterling. Thus, the Thatcher administration publically masked its intentions by emphasising that this deregulation was motivated by laissez-faire ideology. This article thus reconceptualises the role of competition and ideas in spurring capital control liberalisation by demonstrating the importance of industrial competitiveness and the role of ideas as rhetoric.
| Item Type: | Journal Article | ||||||||
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| Subjects: | D History General and Old World > DA Great Britain H Social Sciences > HG Finance |
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| Divisions: | Faculty of Social Sciences > Politics and International Studies | ||||||||
| Library of Congress Subject Headings (LCSH): | Great Britain -- Politics and government -- 1964-1979, Great Britain -- Politics and government -- 1979-1997, Thatcher, Margaret, 1925-2013, Exports -- History -- Great Britain, Foreign exchange -- Law and legislation -- Great Britain | ||||||||
| Journal or Publication Title: | British Journal of Politics and International Relations | ||||||||
| Publisher: | Sage Publications Ltd | ||||||||
| ISSN: | 1369-1481 | ||||||||
| Official Date: | 1 May 2019 | ||||||||
| Dates: |
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| Volume: | 21 | ||||||||
| Number: | 2 | ||||||||
| Page Range: | pp. 403-420 | ||||||||
| DOI: | 10.1177/1369148118819687 | ||||||||
| Status: | Peer Reviewed | ||||||||
| Publication Status: | Published | ||||||||
| Reuse Statement (publisher, data, author rights): | Posted ahead of print. Copley, Jack (2018) Why were capital controls abandoned? The case of Britain’s abolition of exchange controls, 1977-9. British Journal of Politics and International Relations . Copyright © 2018 SAGE Publications. Reprinted by permission of SAGE Publications. https://journals.sagepub.com/home/bpi | ||||||||
| Access rights to Published version: | Restricted or Subscription Access | ||||||||
| Date of first compliant deposit: | 15 January 2019 | ||||||||
| Date of first compliant Open Access: | 15 January 2019 | ||||||||
| RIOXX Funder/Project Grant: |
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