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Macroeconomic Policies, Instability, and Growth in the Wo

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  • Ibrahim Elbadawi
  • Klaus Schmidt-Hebbel

Abstract

High instability and low growth characterize the macroeconomic performance of most developing countries. Inadequate policies are often to blame. This paper documents the empirical regularities that characterize the relationship between macroeconomic-financial policies, instability, and growth across developing and industrial nations. While successful transitions to low instability and high growth are not frequent, they have been observed in a dozen of countries. Such win-win transitions require to put into place institutions and rules that change government incentives in choosing between policies that reflect narrow interests or social conflict -- contributing to more instability and less growth -- and social welfare-maximizing policies that help growth and make economies more resilient to residual instability.

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Bibliographic Info

Paper provided by Central Bank of Chile in its series Working Papers Central Bank of Chile with number 43.

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Date of creation: Dec 1998
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Handle: RePEc:chb:bcchwp:43

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  1. Tabellini, Guido & Alesina, Alberto, 1990. "Voting on the Budget Deficit," American Economic Review, American Economic Association, vol. 80(1), pages 37-49, March.
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Citations

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Cited by:
  1. Gode, Constantino J., 2001. "Sovereign Debt and Uncertainty in the Mozambican Economy," Working Papers UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  2. Zied Ftiti, 2010. "Stabilité-croissance et performance économique : Quelle relation selon une revue de la littérature ?," Working Papers 1026, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
  3. Vatcharin Sirimaneetham, 2006. "Explaining policy volatility in developing countries," Bristol Economics Discussion Papers 06/583, Department of Economics, University of Bristol, UK.
  4. Calderon, Cesar & Loayza, Norman & Schmidt-Hebbel, Klaus, 2005. "Does openness imply greater exposure ?," Policy Research Working Paper Series 3733, The World Bank.
  5. Zied Ftiti, 2010. "Stabilité-croissance et performance économique : quelle relation selon une revue de la littérature ?," Post-Print halshs-00537009, HAL.
  6. César Calderón & Norman V. Loayza & Klaus Schmidt-Hebbel, 2008. "Does Openness Imply Greater Vulnerability?," Working Papers Central Bank of Chile 485, Central Bank of Chile.
  7. César Calderón & Norman Loayza & Klaus Schmidt-Hebbel, 2006. "External Conditions and Growth Performance," Central Banking, Analysis, and Economic Policies Book Series, in: Ricardo Caballero & César Calderón & Luis Felipe Céspedes & Norman Loayza (Series Editor) & Klaus (ed.), External Vulnerability and Preventive Policies, edition 1, volume 10, chapter 3, pages 041-070 Central Bank of Chile.

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