One plausible mechanism through which financial market shocks may propagate across countries is through the effect of past gains and losses on investors' risk aversion. We first present a simple model on how heterogeneous changes in investors' risk aversion affect portfolio decisions and stock...

Countries’ absolute and relative international reserves adequacy has recently attracted considerable attention. The analysis has however concentrated on the largest and most advanced economies. We apply various methodologies for assessing reserve adequacy in Central America, taking into...

This paper discusses tax and expenditure policy reforms to raise employment. Using data for 58 advanced and emerging economies, the paper provides a unified assessment of tax and expenditure measures that have usually been addressed separately. The focus is on incentives to increase labor demand...

This note reflects macroeconomic and fiscal forecasts presented with the April 2009 World Economic Outlook, as well as information on fiscal stimulus and financial and industrial sector support gathered through mid-May. It follows the request by G-20 leaders for the Fund to assess regularly the...

The economic and financial crisis is affecting the fiscal accounts of virtually every country. Public sector support for the financial system, fiscal stimulus and the automatic stabilizers, as well as the revenue decline from the downturn in commodity and asset prices, are leading to sharp...

This assessment of Financial Sector Supervision and Regulation for Samoa provides an overview of legal and institutional frameworks. Compliance with the Basel Core Principles (BCPs) for the supervision of international and domestic banks has improved considerably. Supervision of domestic banks...

In recent years, the IMF has released a growing number of reports and other documents covering economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with government officials, is published at the option of the member country.

This paper surveys the foreign exchange markets, money and secondary government security markets, and stock exchanges in 107 smaller economy countries. The underdevelopment of these markets impedes risk transfer, monetary policy, corporate financing, and the capacity to absorb capital inflows....

The Financial System Stability Assessment of Morocco reviews the reform program that is aimed at establishing a modern, market-oriented financial system that optimizes the mobilization of savings and the allocation of financial resources. It reviews the modernization of the banking sector and...

This paper analyzes through what channels the euro crisis has affected firm valuations globally. It examines stock price responses over the past year for 3045 non-financial firms in 16 countries to three key crisis events. Using pre-crisis benchmarks, it separates effects arising from changes in...