Testing for Credibility Effects
Summary:
This paper examines some recent techniques designed to draw inferences about the credibility of changes in macroeconomic policy regimes. An alternative two-step approach, based on the decomposition between permanent and transitory components of a "credibility variable" is proposed. The methodology is then used to test for the existence of a credibility effect in the Cruzado stabilization plan implemented in Brazil in 1986.
Series:
Working Paper No. 1991/110
Subject:
Exchange rates Foreign exchange Government debt management Inflation Price controls Prices Public financial management (PFM)
Notes:
Also published in Staff Papers, Vol. 39, No. 3, September 1992.
English
Publication Date:
November 1, 1991
ISBN/ISSN:
9781451853254/1018-5941
Stock No:
WPIEA1101991
Pages:
33
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