Stabilization and exchange rate policy in Romania*
The Economics of Transition, 1996, vol. 4, issue 1, 229-248
This paper presents the major traits of the stabilization efforts underway, underlining the role of exchange rate policy. The surprisingly good response of the economy to the “policy shock” of 993–1994 is explained by the ubiquitous large X‐inefficiencies and the impact of the foreign exchange market on information and transaction costs. It is argued that restructuring and the imposition of good corporate governance on a wide scale, which are essential for reducing further inflation, need much more capital inflows (foreign direct investment) and the latter can be encouraged by faster privatization. Since systemic strain makes “stop and go” measures almost unavoidable, the challenge for policy‐makers is to avoid policy fluctuations of large amplitude and to enhance steadily their credibility.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bla:etrans:v:4:y:1996:i:1:p:229-248
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0967-0750
Access Statistics for this article
The Economics of Transition is currently edited by Philippe Aghion and Wendy Carlin
More articles in The Economics of Transition from The European Bank for Reconstruction and Development Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().