Abstract for: Conceptualizing Capital Flight: A Systems Perspective
Economic growth and development is at the core of the policy framework of every country in the world. Economic managers of sovereign countries make their utmost effort to create and sustain an environment that is conducive to investment because investment is generally considered to be the engine of economic growth and development. Nevertheless, many of the countries face incessant capital flight due to the unintended consequences of many of the policies otherwise thought to be productive when considered in isolation. We observe exogenous explanations for capital flight ignoring the fact that behavior of the system is endogenously produced by the interaction of its different parts. We use the causal loop diagram to portray the intertwining nature of the variables involved that define complexity of the system that underlies the dynamic behavior of capital flight. Based on feedback, we propose to improve this CLD and will use improved version to develop a generic SD model. We will calibrate the model to a number of different cases to establish its portability in different contexts and robustness. Using the learning obtained from the model, the relevant literature and the simulation results, we will suggest robust and optimal policies to manage the capital flight.