The regulatory and supervisory practices most effective in promoting good performance and stability in the banking sector are those that force accurate information disclosure, empower private sector monitoring of banks, and foster incentives for private agents to exert corporate control

We use a Markov switching model to estimate a time-varying Taylor-type rule for Indian monetary policy conduct. This empirical approach is consistent with statements of Indian monetary policy decision-makers. We find that the conduct of monetary policy over approximately the last two decades can...