In a single volume, this book treats the theoretical, empirical, and case studies approaches to the implementation of monetary reforms and discusses specific countries' experiences with these approaches. The analyses are not restricted to central bank or exchange rate reforms, but consider all the principal tools of monetary reforms in this volume. The first section surveys and examines the types of monetary reforms. The second and third sections examine the pros and cons of exchange rate management and central bank independence. The final section of the book presents case studies on monetary and central bank experiences in Germany, the United States, Canada and Hungary.

Developing countries' financial sector has been affected by a troubled macroeconomic environment and repressive policies. To improve their financial sector performance, some governments have responded with financial reform policies which have succeeded in only a few but failed in several countries. This book identifies the challenges and solutions for policymakers and financial managers in countries implementing financial reform policies. It analyzes the anatomy of success and failure of reform and argues for sound financial regulation and supervision in these countries.

Investment provides an examination of the key macroeconomic theories which underpin fixed asset investment. It would make ideal reading for an intermediate level macroeconomics course or a module on fixed asset investment taking an applied macroeconomic perspective.

This book studies the causes and cures of inflation in a monetary union. It carefully discusses the effects of money growth and output growth on inflation. The focus is on producer inflation, currency depreciation and consumer inflation. For instance, what determines the rate of consumer inflation in Europe, and what in America? Moreover, what determines the rate of consumer inflation in Germany, and what in France? Further topics are real depreciation, nominal and real interest rates, the growth of nominal wages, the growth of producer real wages, and the growth of consumer real wages. Here productivity growth and labour growth play significant roles. Another important issue is target inflation and required money growth. A special feature of this book is the numerical estimation of shock and policy multipliers.

ical) and to self-fulfilling currency crisis, respectively. Research stressing the former approach was pioneered by Krugman (1979) and Flood and Garber (1984). According to this line of research, the failure of governments to adopt domestic monetary and fiscal policies consistent with their stated exchange rate targets leads to a gradual diminution of reserves and eventually a stock adjustment that depletes reserves suddenly in one attack (Sachs, Tornell, and Velasco, 1996, page 47). The result is either a devaluation of the exchange rate or a switch to floating. Subsequent work of this genre has specified a number of other channels, in addition to that involving inconsistent and unsustainable monetary and fiscal policies, that can precipitate an attack: 1. Inconsistency between external and internal objectives. The stances of monetary and fiscal policies may be consistent with the authorities' exchange rate target, but domestic economic indicators (such as the unemployment rate) may be inconsistent with internal balance, resulting in pressures on the authorities to relax macroeconomic policies. Private agents, aware of this inconsistency, perceive an opportunity for profits from a currency devaluation and precipitate an attack. 2. Contagion effects. Prior to an attack on another currency (say that of country B), the market may view a country's (say, country A's) exchange rate as consistent with economic fundamentals and, thus, sustainable.

Procyclicality of the financial system is a feature of any normally functioning economy. However, procyclicality can sometimes become 'excessive' leading to undesired effects on the real economy. The challenge that this volume addresses is to define 'excessive' and to identify policy actions that could produce superior outcomes.

A study of the Malaysian economy and labour market. Malaysia has enjoyed an enviable growth record over the last 25 years of the 20th century, which few nations can match, and has also been keen to judge her performance against non growth criteria of poverty eradication and national unity following the emergence of racial conflict in 1969. There are many lessons for policy makers elsewhere of this active approach to poverty eradication and social restructuring while generating rapid growth, which stands in sharp contrast to both laissez faire and orthodoxy.

This book brings together articles by international political economists on Keynesian economics and its legacy. The book begins with Don Patinkin's assessment of Keynes' early life and focuses attention on Keynes' contribution to monetary economics. Among the many controversies surrounding "The general theory", Axel Leijonhufvud takes the view that the Keynesian revolution began and stayed on the wrong track.;Leland Yeager refutes the idea that Keynesian economics was responsible for the general prosperity in the indusrialized world immediately after the Second World War. Although Karl Brunner is not fundamentally against Keynes' methodological approach, he is critical of his reliance on fiscal rather than monetary policy. Whereas Terence Hutchison defends Keynes, both against his critics but also against Keynesians, and argues that Keynes would not have shared their interpretation of his work on fundamental grounds. Patrick Minford traces the roots of neoclassical economics, based on the concept of rational expectations, back to "the general theory". In the final chapter, Stephen Littlechild offers an alternative to Keynesian economics by focusing attention on the Austrian school.

South Korea's path toward a higher quality of life has been a dynamic process, Suh shows, shaped by historical contingencies, some immutable logic of capitalist development, and a dialectical relationship between the state and Korean civil society. Debunking the illusion of democracy and myths of self-regulating capitalism in South Korea, Suh shows that a growth machine is not a panacea for the development of human beings and their quality of life. If instead the raison d'etre of quality of life depended upon a robust civil society operating under fair rules of the game by the state, the developmental road would be more promising.

Suh seeks to test the hypothesis that the rising tide of economic growth will raise all boats in the Korean sea, remapping its structural pressure points which have been submerged at high tide. Given the high levels of economic growth generated by state intervention, any demand of distributive justice necessitates egailitarian reforms. As Suh shows, the present South Korean situation goes straight to the heart of theoretical questions about the enduring structures of capitalism, and its promise to improve average living standards and to link the redistribution of economic rewards to enhanced economic performance of the system as a whole.

South Korea's path to quality of life has been a dynamic process, Suh shows, determined by historical contingencies, with some immutable logic of capitalist development, and a dialectical relationship between the state and Korean civil society. A study of particular interest to scholars, researchers, and policy makers concerned with political economy and social-economic development and East Asian Studies.

This book analyzes the revenues from the creation of currency by a central government. Adopting an institutional perspective, it develops a general theory of seigniorage by identifying three monetary regimes in economic history and the history of economic thought: a commodity currency, a fiat currency and a credit currency regime. As such it provides a modern analytical framework to analyze the nature of revenues from the creation of currency and their optimal height, whether currency is issued by means of minting coins, by printing and spending paper notes, by crediting private entities, or combinations thereof. The results of this analysis stretch beyond the immediate topic. The book establishes a relationship between the theory of seigniorage and government debt, the theory of the interest rate, the optimal rate of inflation, or the effectiveness and inflationary limits of outright monetary transactions.

The CFA Franc Zone in West and Central Africa represents the largest monetary union in the southern hemisphere, predating the European Monetary Union by decades. This book analyzes the recent economic experiences of the Franc Zone's member states and of its economic institutions. It pays particular attention to the way this disparate group of countries exploit the advantages and manage the costs of adhering to a single currency. It also analyzes the impact Franc Zone institutions have on poverty.

This volume consists of a number of papers related to the theme of the dynamics of inequality and poverty. These are subdivided into four separate parts.

The five chapters in Part I of this volume are concerned with inequality and poverty over extended time periods. Bandyopadhyay and Cowell deal with the concept of vulnerability in the context of income mobility of the poor. Biewen studies the extent and the composition of chronic poverty in Germany, comparing the results with the United Kingdom and the United States. Van de Ven describes a dynamic microsimulation model of cohort labour earnings based on the Australian population aged between 20 and 55 years, and considers how the widening social gap between the Australia and the UK is reflected by their redistributive systems, through the use of static and dynamic microsimulation. Kelly analyses the lifetime distribution of net worth in Australia using a dynamic microsimulation model to project the cross-sectional and lifetime asset holdings of a 5-year birth cohort over a period of 40 years.

In Part II, the issue of intergenerational transfers of poverty is considered. Corak compares generational earnings mobility and the reasons for the degree to which the long run labour market success of children is related to that of their parents across countries. He provides a framework for understanding the underlying causal process as well as the conception of equality of opportunity, as a guide for public policy.. Grawe uses data from the British National Childhood Development Study to examine the quality-quantity trade-off in fertility in multiple measures of child achievement. Maani examines the link between parental incomeand other resources during adolescent years, and higher education choices of the offspring at age 18, using a recent longitudinal data set from New Zealand.

Part III is concerned with inequality over time. First, Wolff examines US inequality since the late 1940s, investigating the role of computer investment, dispersion of schooling and unionisation rate in the rise in inequality between 1968 and 2000. Second, Chotikapanich and Griffiths consider the question of testing for dominance in income distributions through the development of Bayesian methods of inference, which report on changes in income distributions in terms of the posterior probabilities. This allows an assessment of whether income distributions have changed over time.

The final part of this volume is concerned with measurement issues. Makdissi and Wodon propose a measure of extreme poverty which is multidimensional in nature. It recognises the fact that there are interaction effects between different deprivations and that the length of time during which deprivations are felt may have a negative impact on household well-being. In the final contribution, Cowell examines Theil's approach to the measurement of inequality in the context of subsequent developments over recent decades.
*Focuses on the dynamics of inequality and poverty
*Examines inequality and poverty over time, the intergenerational transfer of poverty, inequality over time, and measurement issues
*Chapters discuss inequality and poverty in developed countries around the world, providing a mulitnational perspective

The bulk of this volume deals with the four main aspects of risk management: market risk, credit risk, risk management - in macro-economy as well as within companies. It presents a number of approaches and case studies directed at applying risk management to diverse business environments. Included are traditional market and credit risk management models such as the Black-Scholes Option Pricing Model, the Vasicek Model, Factor models, CAPM models, GARCH models, KMV models and credit scoring models.

Having the high unemployment in Germany in mind, this book discusses how macroeconomic theory has evolved over the past forty years. It shows that in recent years a convergence has taken place, with modern models embodying a Keynesian transmission mechanism, monetarist policy implication, and modeling techniques inspired by new classical economics and real business cycle theory. It also probes in which direction models may be extended from here. Empirically, the book uses different econometric techniques to investigate the relevance and implications of different macroeconomic theories for German data. A key question this book investigates is the role of demand and supply side conditions for the increase in the German unemployment rate. On a policy level, the book relates the implications of the different theories to the ongoing debate on the appropriate roles of demand and supply side policies for curing the German unemployment problem.

A comprehensive and profoundly relevant history of interest from one of the world's leading financial writers, The Price of Time explains our current global financial position and how we got here In the beginning was the loan, and the loan carried interest. For at least five millennia people have been borrowing and lending at interest. The practice wasn't always popular--in the ancient world, usury was generally viewed as exploitative, a potential path to debt bondage and slavery. Yet as capitalism became established from the late Middle Ages onwards, denunciations of interest were tempered because interest was a necessary reward for lenders to part with their capital. And interest performs many other vital functions: it encourages people to save; enables them to place a value on precious assets, such as houses and all manner of financial securities; and allows us to price risk.All economic and financial activities take place across time. Interest is often described as the "price of money," but it is better called the "price of time: " time is scarce, time has value, interest is the time value of money.Over the first two decades of the twenty-first century, interest rates have sunk lower than ever before. Easy money after the global financial crisis in 2007/2008 has produced several ill effects, including the appearance of multiple asset price bubbles, a reduction in productivity growth, discouraging savings and exacerbating inequality, and forcing yield starved investors to take on excessive risk. The financial world now finds itself caught between a rock and a hard place, and Edward Chancellor is here to tell us why. In this enriching volume, Chancellor explores the history of interest and its essential function in determining how capital is allocated and priced.

This book reveals how the Japanese national ministries can exploit their Special Status Corporations (public corporations, supported primarily with public funding from a state-run banking agency) in order to intensify their administrative power over industries and local governments and to perpetuate the interests of elite civil servants by facilitating the migration to post-retirement positions in the private sector. The book explains why the existence of these organizations inhibits the Prime Ministers efforts to implement structural reforms.

This series provides overviews and case studies of states and sectors, classes and companies in the new international division of labour. These embrace political economy as both focus and mode of analysis. The series treats polity-economy dialects at global, regional and national levels and examines novel contradictions and coalitions between and within each. There is a special emphasis on national bourgeoisies and capitalisms, on newly industrializing or influential countries and on novel strategies and technologies.;The concentration throughout is on uneven patterns of power and production, authority and distribution, hegemony and reaction. Attention is paid to redefinitions of class and security, basic needs and self-reliance and the range of critical analysis includes gender, population, resources, environment, militarization, food and finance.;This particular volume looks at the industrialization of Singapore and challenges the dominant understanding of Singapore as a case where "correct" policies have made rapid industrialization possible and raises questions about the possibility and appropriateness of its emulation. The study focuses on the relationship between internationa

Opportunities for growth and investment in Central America could well improve in the coming years, as the region's ties with the world economy grow closer. This integration, however, also presents important challenges for economic policy to ensure that growth can be sustained and can benefit the poor. This book stresses the importance of keeping fiscal policy on a sustainable path, strengthening public investment in basic infrastructure and primary health care and primary and secondary education, and managing the risks associated with partial dollarization. ANA CORBACHO Economist, Fiscal Affairs Department, International Monetary Fund, USA HAMID R. DAVOODI Senior Economist, Middle East and Central Asia Department, International Monetary Fund, USA ALAIN IZE Advisor, Monetary and Financial Systems Department, International Monetary Fund, USA DANIEL LEDERMAN Senior Economist, World Bank, USA VALERIE MERCER-BLACKMAN Economist, Western Hemisphere Department, International Monetary Fund, USA GUILLERMO PERRY Chief Economist of the Latin American and Caribbean Region, World Bank, USA JANET G. STOTSKY Fiscal Affairs Department, International Monetary Fund, USA RODRIGO SUESCN Senior Economis

The financial crisis hit the global economy unexpectedly from August 2007 producing consequences comparable to the ones experienced in the course of the 1930s. This book provides a comprehensive interdisciplinary account of the events leading to the financial crisis, its institutional causes and consequences, its economic characteristics and its socio-political implications.
This book represents a unique opportunity to gather the opinions of established experts on financial markets from different academic disciplines and from a different academic traditions debating over the future of the global financial order. Leading economists are confronted with leading political scientists in an effort to assess the future of global financial stability and to propose solutions to the problems envisaged.
This book is essential reading for all interested in macroeconomics, political economy, globalization studies and political science.

On 1 May 1967 Dr. J elle Zijlstra was appointed President of De Nederlandsche Bank, after an already eventful career. Following a brief spell as Professor of Economics at the Free University of Amsterdam, he began a lengthy period of ministerial service in 1952. During his cabinet years, he devised a concept which became known in the Netherlands as the' Zijl- stra norm', and which was aImed at keeping the Government's financial deficit in check. He concluded his active political career .as prime minister in 1966-1967. Dr. Zijlstra's career as a politician and central banker covered a period of nearly 30 years during which the economic scene in the N ether- lands and in the world underwent wide cyclical ups and downs and impor- tant changes of a more long-lasting nature. Successful economic recovery after the Second World War was followed by a period of rapid and rela- tively stable economic growth. However, as early as the 1960s the condi- tions for the maintenance of equilibrated expansion became less secure. These conditions were further impaired in the 1970s partly as a result of important shocks, such as the oil crises.

This is a book on stochastic dynamic macroeconomics from a Keynesian perpective. It shows that including Keynesian features in intertemporal models considerably contributes to resolve major puzzles arising in the context of the Dynamic General Equilibrium (DGE) model. It also demonstrates that including microeconomic intertemporal behavior of economic agents in macroeconomics is not inconsistent with Keynesian economics. Whereas the first two parts of the book are technically and empirically oriented by elaborating on solution and estimation methods to bring dynamic macroeconomic theory closer to the time series data, the part three of the book uses those tools and addresses major issues in contemporary dynamic macroeconomics. In pursuing those issues the book stresses-as in the New Keynesian literature-nominal and real rigidities. Yet, beyond the latter type of literature-and in contrast to the DGE model -the here presented modeling approach admits open ended dynamics and multiple equilibria, more realistic asset market features, nonclearing labor market, and explores the role of both demand and technology shocks on employment. Central for those results is a new methodological idea pertaining to adaptive optimization where agents can reoptimize once they have perceived and learned about market constraints. Overall, the book is self-contained by including the appropriate solution and estimation methods which brings the theory closer to the time series data. It contains a modern treatment of dynamic macroeconomics for first and second year graduate students.

This textbook gives a comprehensive introduction to stochastic processes and calculus in the fields of finance and economics, more specifically mathematical finance and time series econometrics. Over the past decades stochastic calculus and processes have gained great importance, because they play a decisive role in the modeling of financial markets and as a basis for modern time series econometrics. Mathematical theory is applied to solve stochastic differential equations and to derive limiting results for statistical inference on nonstationary processes. This introduction is elementary and rigorous at the same time. On the one hand it gives a basic and illustrative presentation of the relevant topics without using many technical derivations. On the other hand many of the procedures are presented at a technically advanced level: for a thorough understanding, they are to be proven. In order to meet both requirements jointly, the present book is equipped with a lot of challenging problems at the end of each chapter as well as with the corresponding detailed solutions. Thus the virtual text - augmented with more than 60 basic examples and 40 illustrative figures - is rather easy to read while a part of the technical arguments is transferred to the exercise problems and their solutions.

This is a demonstration that poverty remains a universal phenomenon, even as most parts of the world see increase in affluence of varying degrees. Cutting across the globe, the study focuses on 24 countries including the industrialised economies, planned economies, developing market economies, mixed economies and the least developed economies. Professor Khusro examines the causes of poverty and of development, the impact of colonialism and the industrial revolution and policies for reducing global poverty today. Theoretical questions of measuring poverty are allied to historical and contemporary analysis.