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As well as imposing capital controls, countries might retreat towards autarky, by raising retaliatory tariffs.
Some countries, like Brazil, reacted by imposing capital controls.Mainstream economics is increasingly sympathetic.
The government flirted briefly with imposing capital controls to halt the decline in the rupiah.
But the process of bringing back the drachma is likely to involve temporarily shutting down banks and imposing capital controls.
One risk from imposing capital controls is that they can be hard to roll back because they suit vested interests.
But be mindful of any attempts to force Greece into imposing capital controls to prevent capital flight and bank runs.
Similar(15)
So the government could impose capital controls.
It would have to impose capital controls.
That is why many may follow Brazil's lead and impose capital controls.
The more immediate worry is that Nicosia could impose capital controls when the banks reopen.
Back in 1998, Malaysia imposed capital controls that effectively ceased the trading of offshore ringgit.
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