Measuring Capital Controls: Data, Methods, and Trade-offs across De Jure and De Facto Measures

RePEc Short ID: pre260
ORCID iD: 0000-0002-1481-051X

Bass, Mickenzie; Restrepo-Echavarria, Paulina

doi:10.20955/r.2026.11

Journal Article

Measuring Capital Controls: Data, Methods, and Trade-offs across De Jure and De Facto Measures

Abstract: From the tightly managed capital accounts of the Bretton Woods era to today's globally integrated financial markets, capital controls have fundamentally shaped the world economy. Yet, measuring these restrictions accurately remains a challenge for economic researchers. This article provides a comprehensive review of the major approaches to measuring capital controls that exist in the literature. These approaches can be categorized into two types: de jure measures, which capture legal restrictions as written in official policy documents, and de facto measures, which quantify the actual frictions restricting capital flows in practice. Using the United States and Mexico as case studies, we demonstrate that different measures of capital controls look very different, even when constructed from identical source materials. The article documents how these measures are constructed and illustrates the differences that emerge between them. We conclude that existing measures capture different elements of controls and should be viewed as complements rather than substitutes.

JEL Classification: E65; F21; F33; F38; F41;

https://doi.org/10.20955/r.2026.11