This paper investigates the economic impact of a coordinated reduction in military expenditures of 20 percent using a specially modified version of the MULTIMOD world economic model. Simulation results indicate that in developing countries the present value of consumption increases by 46 percent...

The paper examines the role of credibility in the conduct of exchange rate policy in developing countries, The analysis is based on a model in which policymakers are concerned about inflation and external competitiveness. Price setters in the nontraded goods sector of the economy adjust prices...

This paper examines the relationship between temporary terms of trade shocks and household saving in developing countries. It is first shown that, from a theoretical standpoint, this relationship is ambiguous: private saving may rise or fall in response to a transitory terms of trade shock,...

A robust empirical determinant of long-term economic growth in many developing countries has been the expansion and diversification of the export sector. The latter, in turn, has been influenced by capital accumulation and economic growth. The growth model developed here explores this...

This paper discusses three important extensions to the developing country scenario and adjustment model used in the World Economic Outlook exercises. First, the model is augmented to include fiscal and monetary sectors and now explicitly captures links among government policy, investment, output...

This study examines the effects of selected policies on economic efficiency in 81 developing countries by pooling cross-country data over various subperiods between 1961-90. An incremental output-capital ratio is the measure of economic efficiency, while the policy variables include: export...

In an indirect monetary policy framework, open market operations become the central bank’s main instrument. In the initial stages, when financial markets are still undeveloped, selection of a financial instrument for those operations and the design of supporting arrangements to ensure the...

This paper analyzes the initial conditions before Fund financial arrangements are adopted. Evidence from 324 Fund arrangements in 78 developing countries during 1973-91 indicates that there are important differences in the characteristics between program episodes and a control group. Program...

On the basis of a comparative study of 23 episodes involving commodity price shocks we find that both the public and private sectors typically save around half of a windfall gain resulting from a price rise. We argue that private windfalls should be left with the private sector rather than...

This paper presents a framework for planning the development of computerized government budgeting and accounting systems in economies in transition and developing economies. It argues that a comprehensive framework is needed to enable fiscal management issues to be addressed effectively, then...