The dynamic adjustment of a transition economy in the early stages of transformation
AbstractThis paper develops a model of a representative transition economy to explain the stylised facts of output declines and real exchange rate appreciation in the early stages of transformation. These facts can be explained by supply-side shocks, interest rate liberalisation or a reduction in core inflation. The policy implication is that price liberalisation in advance of financial liberalization and structural reform, including widespread privatisation of the production process, necessarily results in some temporary loss of output.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Macroeconomics.
Volume (Year): 26 (2004)
Issue (Month): 3 (September)
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Web page: http://www.elsevier.com/locate/inca/622617
Other versions of this item:
- Christos Papazoglou & Eric J. Pentecost, 2003. "The Dynamic Adjustment of a Transition Economy in the Early Stages of Transformation," Working Papers 03, Bank of Greece.
- F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
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