Examines the issue of moral hazard inrelation to IMF loans to countries in financial difficulties. Concerns about moral hazard have had a prominent place in recent discussions on how the architecture of the international financial system should be reformed and what the IMF’s role should be

Publication of minutes of monthly monetary policy meetings between the Chancellor of the Exchequer and the Governor of the Bank of England was a conspicuous feature of the United Kingdom’s inflation targeting framework from 1994 through April 1997. It was intended to reinforce credibility by...

This paper examines alternative approaches to building sound financial structures in emerging market economies. The foremost task is to resolve the bad loan problem and to recapitalize insolvent state banks. By restoring an incentive for banks to price accurately the risks of new lending, this...