|Banking and Monetary Reform
System Reforms and Monetary Policy
Tomás J.T. Balińo, Omotunde E.G. Johnson, and V. Sundararajan
The design of payment systems has important implications for the conduct
of monetary policy, the soundness of financial firms, and the functioning of the economy
as a whole.
A Spur to Economic Growth
World stock markets are booming and stock markets in developing countries
account for a disproportionately large share of this boom. Investors are venturing into
the world's newest markets and some are seeing handsome returns. But are developing
countries themselves reaping any benefits from their stock markets? The evidence indicates
that they are.
Emerging East Asian Bond Market
Ismail Dalla and Deena Khatkhate
The rapid growth of East Asia's bond markets mirrors the region's
spectacular economic development. East Asian bond markets are projected to thrive over the
next decade, reflecting continued strong private sector growth and deepening financial
Indirect Instruments of Monetary Policy
William E. Alexander, Tomás J.T. Balińo, and Charles Enoch
In the late 1970s, industrial countries began moving toward full reliance
on indirect instruments, such as open market operations, rediscount facilities, and
reserve requirements. Many developing and transition economies have followed suit.
Indirect instruments are more effective than direct instruments in today's increasingly
open economic environment.
Sector Reforms in China
Hassanali Mehran and Marc Quintyn
China's financial reforman integral part of its transition to a
market economyhas been characterized by pragmatism and gradualism. During the first
decade of reforms, policymakers have emphasized institutional development, with the result
that real market development has lagged behind.
Tequila Effect and Argentina's Banking Reform
Mauricio Carrizosa, Danny M. Leipziger, and Hemant Shah
The disruption of Mexico's economy in late 1994 triggered a confidence
crisis in Argentina that accelerated the restructuring of the banking sector. The
restructuring process has involved the privatization of provincial banks, consolidation of
private banks, and selective bank liquidations. It represents an important milestone in
Argentina's long struggle to strengthen its banking system.
||Global Economic Prospects and the
New Opportunities, Tough Challenges
Greater integration of developing countries into the global economy will
present some difficult challenges but is well worth pursuing. Industrial and developing
countries alike stand to gain significantly.
The Impact of
the Internationalization of Services on Developing Countries
Carlos A. Primo Braga
Advances in information technology have vastly expanded the range of
services that can be traded internationally. Developing countries stand to benefit on two
frontsthey will be able to increase their exports of services and they will gain
access to services not available domesticallyprovided they reform the regulatory
environment and develop the necessary human and physical capital.
Linkages: The Growing Importance of Developing Countries
Swati R. Ghosh
As trade between developing and industrial countries grows and
cross-border capital mobility increases, the developing countries will have a greater
impact on the global economy. Although public debate has focused on possible adverse
effects on the industrial economies, analysis suggests that the latter will benefit from
Also in this Issue
Regimes as Inflation Anchors
Peter J. Quirk
Are fixed exchange rate regimes more effective in inflation-fighting
programs than flexible regimes? The answer is elusive. The operational differences between
the two types of regimes have narrowed, and the relationship between choice of regime and
macroeconomic performance has proven hard to assess empirically.
and Financial Stability in the Middle East and North Africa
Jean-Pierre Chauffour, Sena Eken, Mohamed A. El-Erian, and Susan
This is a particularly opportune time for countries in the Middle East and
North Africa to implement reforms to fulfill their considerable economic potential and
reap the benefits of greater globalization and integration.
Economic Growth and Convergence in India
Paul Cashin and Ratna Sahay
While per capita incomes in the states of India are quite diverse, they
have been slowly converging in recent decades. Conver-gence has been aided by grants from
the central government to the states; however, the contribution of internal migration to
this process appears minimal.
from the Editor
Economy in Transition
Emerging Stock Markets in 1995: Decline Followed by Year-End Upturn
Graeme Littler and Ziad Maalouf
Financial Regulation in the Global Economy by Richard J. Herring
and Robert E. Litan
reviewed by Warren Coats
International Debt Reexamined by William R. Cline
reviewed by Martin Cerisola
How Many People Can the Earth Support? by Joel E. Cohen
reviewed by Lant Pritchett
Environment and Resource Policies for the World Economy by Richard N. Cooper
reviewed by Michael Cohen
The Effects of Taxation on Multinational Corporations and Taxing Multinational
Corporations both edited by Martin Feldstein, James R. Hines, Jr., and R. Glen Hubbard
reviewed by Enil M. Sunley