Two crises: inflationary inertia and credibility

Article Abstract:

Government announcement credibility affects the effectiveness of exchange-rate-based stabilization programs in eliminating inflationary inertia. An immediate elimination of inflationary inertia results from an exchange-rate-based stabilization program whenever the credibility of a government announcement to reduce inflation is high. Elimination of inflationary inertia through exchange-rate-based stabilization program tends to be slow whenever the credibility of a government announcement is low.

Economics, Research and Development in the Social Sciences and Humanities, Research, Inflation (Finance), Monetary policy, Currency devaluation, Devaluation (Currency), Inflation (Economics)

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The role of credibility in the cyclical properties of macroeconomic policies in emerging economies

Article Abstract:

Optimal stabilization policy is counter cyclical, aiming at keeping output close to its potential, however it has been traditionally debated that emerging countries are unable to adopt counter cyclical monetary and fiscal policies. It is debated that the cyclical properties of macroeconomic policies depend critically on policy credibility.

Forecasts, trends, outlooks, Models, Forecasts and trends, Market trend/market analysis, Emerging markets

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Debt relief and fiscal sustainability

Article Abstract:

The relationship between fiscal policy, aggregate and public sector debt sustainability, and debt relief is analyzed. It concludes that the Highly Indebted Poor Countries (HIPC) debt relief initiative would help the poor countries move towards macroeconomic sustainability.

External debt relief, Debt relief, Public sector

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