Key Points
International finance has exploded during the 1990s as countries, particularly in the developing world, have bowed to the conventional wisdom that they should remove barriers to these flows.
The flood of capital into countries like Mexico, while fueling economic growth for a period of time, has done little to improve the lives of the majority of people.
The roots of the crisis may lay in the financial liberalization that encouraged a flood of short-term private flows into Thailand, the Philippines, and elsewhere in the early 1990s.