The large scale movement of investment money from one country to another in search of greater stability or higher returns.

This type of capital differs from people, land, natural resources, and man-made equipment in that it is not real wealth that is lost, but only the representations of wealth that are used to facilitate trade. Thus, like currency / bank collapses and stock market crashes, nothing truly tangible has been lost. Only the accounting has to change.

A country that suffers from capital flight need merely re-evaluate the real goods it produces or is capable of producing. Its existing currency can be revoked and replaced by a more accurate representation of the wealth of the nation (such as backing it with a basket of goods like that used in the CPI).

In order to make up for the loss of the power to import because of the loss of foreign exchange, the country will either have to ensure that it can replace imports with domestic production or it will have to focus employment on exporting goods to the countries that can produce what cannot be produced locally.

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