Monetary Commitment and Structural Reforms: A Dynamic Panel Analysis for Transition Economies

Ansgar Belke and Lukas Vogel

No 1221, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: This paper examines the contemporaneous relationship between the exchange rate regime and structural economic reforms for a sample of CEEC/CIS transition countries. We investigate empirically whether structural reforms are complements or substitutes for monetary commitment in the attempt to improve macroeconomic performance. Both EBRD and EFW data suggest a negative relationship between flexible exchange rate arrangements and external liberalization. Another finding from the EFW sample is that economic liberalisation has tended to be stronger under better macroeconomic fundamentals, suggesting that the impact of good macroeconomic conditions as facilitating structural reforms outweighs countervailing effects in the sense of lower reform pressure.

Keywords: exchange rate regime; structural reform; panel data; political economy of reform; transition countries (search for similar items in EconPapers)
JEL-codes: D78 E52 E61 F36 (search for similar items in EconPapers)
Pages: 23 p.
Date: 2012
New Economics Papers: this item is included in nep-mon and nep-tra
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Monetary commitment and structural reforms: a dynamic panel analysis for transition economies (2015)
Working Paper: Monetary Commitment and Structural Reforms: A Dynamic Panel Analysis for Transition Economies (2012)
Working Paper: Monetary Commitment and Structural Reforms – A Dynamic Panel Analysis for Transition Economies (2012)
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