This paper reviews recent advances in the specification and estimation of Bayesian Vector Autoregressive models (BVARs). After describing the Bayesian principle of estimation, we first present the methodology originally developed by Litterman (1986) and Doan et al. (1984) and review alternative...

This paper analyzes broad money demand (M2) in Guyana from January 1990 to September 1999; a period marked by deep transformations aimed at shifting Guyana from a centralized to a market economy. The paper develops a stable error-correction model based on a long-run cointegrating vector of money...

This paper attempts to explain short- and long-term dynamics of-and forecast-inflation in Tajikistan using the Vector Error Correction Model (VECM) and Autoregressive Moving Average Model (ARMA). By analyzing different transmission channels through the VECM, we were able to evaluate their...

Some recent studies suggest the possibility of estimating a stable aggregate demand-for-money relationship for the group of countries participating in the European Monetary System. These results are of particular relevance in connection with the task of setting policy targets for a European...

In recent years a number of countries have undertaken far-reaching reforms of their financial sectors. Generally speaking, financial sector reforms aim at achieving greater flexibility of interest rates, an enhanced role for market forces in credit allocation, increased independence for the...

Many central banks in low-income countries in Sub-Saharan Africa are modernising their monetary policy frameworks. Standard statistical procedures have had limited success in identifying the channels of monetary transmission in such countries. Here we take a narrative approach, following Romer...

This paper discusses key findings of the Fifth Review Under the Poverty Reduction and Growth Facility for Georgia. Despite economic sanctions imposed by Russia in 2006, Georgia’s economic growth continues to be strong, and inflation has declined. Growth is expected to reach 9 percent in...

Despite the oil price shock, growth has been high. Discussions focused on the policies needed to reduce Costa Rica’s vulnerabilities, enhance growth, and reduce poverty in a lasting way. Passage of a substantial tax reform is essential. To bring inflation down to low single digits, the...