Modeling the macroeconomic requirements of policy reforms
AbstractThe model presented in this paper is in between RMSM-X and RMSM-XX in that, unlike RMSM-X, it does incorporate behavioural functions for the main macroeconomic variables, namely private consumption, private investment, money demand, demand for quasi money,export supply, and import demand. However, unlike RMSM-XX but like RMSM-X, it is solved recursively for residual variables. The user specifies"target values"for the real exchange rate, real interest rate, and the inflation rate. The model then determines the public sector behaviour consistent with attaining these targets. In an alternative solution, described in Appendix II, the model also permits setting exogenously the public sector variables and determining the private sector behaviour necessary to reach the policy targets. Finally, the model is generalized to take into account external financing constraints by making the real exchange rate exogenous. The model is then used to derive the macro adjustment required by trade and financial liberalization.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 417.
Date of creation: 31 May 1990
Date of revision:
Economic Theory&Research; Environmental Economics&Policies; Macroeconomic Management; Economic Stabilization; Banks&Banking Reform;
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi).
If references are entirely missing, you can add them using this form.