Unlike what happenned in most Latin American economies after the Mexican crisis, the Peruvian trade deficit kept on growing during 1995, in spite of the application of restrictive fiscal and monetary policies. In this paper, a model with free capital mobility, flexible exchange rates and a...

The main goal of this paper is to describe the characteristics of business cycle in Peru during 1950-1996, and to show the importance of external shocks for these economic fluctuations. The pattern of economic fluctuations in Peru, in particular the pattern of recessions, seems to be independent...

One goal of this paper is to discussing the macroeconomic impact that an internacional commodity prices boom has in a small open economy under perfect capital mobility. A Mundell-Fleming model with some adaptations is used for the analysis of this real external shock. There are two effects: the...

The purpose of this paper is to study the transmission mechanism of monetary policy under an institutional framework characterized by a dollarized banking system, a flexible exchange rate and free capital movements. The main result of this study is that a restrictive monetary policy can...

The main purpose of this paper is to emphasize the importance of the externa1 imbalances generated by the economic program of the Fujimori government, presenting the circumstances that explain why these imbalances have been accompanied, paradoxically, by a significative increase in foreign...

There are two main positions to explain the exchange rate appreciation which occurred during President Fujimori's government. The first one state that this appreciation was caused by a restrictive monetary policy, while the second attributes it to a capital inflow originated by the fall of...

This paper describes the neoliberal experiment of the 90’s, placing it in its historical context. The central hypothesis of the document is that the Peruvian economy of the 90s lacks an operative system of fiscal and monetary policies that functions without producing huge disruptions in the...