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Econometric Analysis of Discrete Reforms

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  • Alexei Kireyev

Abstract

The paper suggests an econometric methodology for testing the effectiveness of reforms implemented in one major step, i.e., discrete reforms. The methodology is based on the exogeneity properties of variables in an econometric model. The paper specifies the preconditions for setting up an appropriate model; suggests an economic interpretation of the tests for weak, strong, and superexogeneity; and illustrates this methodology by applying it to two cases of instantaneous reforms. The exogeneity properties of variables in a correctly specified econometric model may help uncover information on the preparation, implementation, and the outcome of such reforms, which could be useful for future policy advice.

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Bibliographic Info

Paper provided by International Monetary Fund in its series IMF Working Papers with number 01/156.

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Length: 38
Date of creation: 01 Oct 2001
Date of revision:
Handle: RePEc:imf:imfwpa:01/156

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  1. Rodrik, Dani, 1993. "The Positive Economics of Policy Reform," American Economic Review, American Economic Association, American Economic Association, vol. 83(2), pages 356-61, May.
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Cited by:
  1. Alexei Kireyev, 2002. "Liberalization of Trade in Financial Services and Financial Sector Stability (Analytical Approach)," IMF Working Papers 02/138, International Monetary Fund.

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