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How can Indonesia maintain creditworthiness and noninflationary growth ?

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  • Ahmed, Sadiq
  • Chhibber, Ajay
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    Abstract

    Despite external shocks, Indonesia has maintained creditworthiness through swift adjustment. Indonesia's flexible economic management and clear policy signals have lent stability to the economy, in contrast to the stop and go reforms, uncertainty, and constant debt renegotiations in many high debt countries. The authors use an econometrically estimated macroeconomic model to analyze open economy adjustment in Indonesia - particularly the interaction between the exchange rate, the interest rate, growth, and debt - and to analyze future policy changes in light of Indonesia's objectives for growth, external debt, and inflation.

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    File URL: http://www-wds.worldbank.org/servlet/WDSContentServer/WDSP/IB/1989/10/01/000009265_3960928084333/Rendered/PDF/multi0page.pdf
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    Bibliographic Info

    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 291.

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    Date of creation: 31 Oct 1989
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    Handle: RePEc:wbk:wbrwps:291

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    Related research

    Keywords: Economic Theory&Research; Environmental Economics&Policies; Macroeconomic Management; Economic Stabilization; Banks&Banking Reform;

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    1. Corbo, Vittorio, 1985. "International Prices, Wages and Inflation in an Open Economy: A Chilean Model," The Review of Economics and Statistics, MIT Press, vol. 67(4), pages 564-73, November.
    2. Bhattacharya, A. & Linn, J.F., 1988. "Trade And Industrial Policies In The Developing Countries Of East Asia," World Bank - Discussion Papers 27, World Bank.
    3. Bruno, Michael, 1978. "Exchange Rates, Import Costs, and Wage-Price Dynamics," Journal of Political Economy, University of Chicago Press, vol. 86(3), pages 379-403, June.
    4. Pinto, Brian, 1987. "Nigeria during and after the Oil Boom: A Policy Comparison with Indonesia," World Bank Economic Review, World Bank Group, vol. 1(3), pages 419-45, May.
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    Cited by:
    1. Huppi, Monika & Ravallion, Martin, 1991. "The sectoral structure of poverty during an adjustment period: Evidence for Indonesia in the mid-1980s," World Development, Elsevier, vol. 19(12), pages 1653-1678, December.

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