EconPapers    
Economics at your fingertips  
 

Credibility of the Russian Stabilisation Programme in 1995-98

Tatiana Kirsanova
Authors registered in the RePEc Author Service: George Kapetanios () and Richard J. Smith ()

No 193, National Institute of Economic and Social Research (NIESR) Discussion Papers from National Institute of Economic and Social Research

Abstract: This paper investigates the price stabilisation process under the policy commitment to an exchange rate based programme. I develop a formal model which allows to quantify the credibility role in the price stabilisation process and assess the extent to which the economic fundamentals can affect the reputation of policymakers. I decompose devaluation expectations into a probability that authorities are not precommitted with certainty to preannounced policy and a probability that worsened economic fundamentals force authorities to renege on the chosen fixed exchange rate policy. The model is then estimated using Russian data for the IMF stabilisation programme, preceding the rouble collapse in August 1998. I find that past fundamentals and reputation are significant determinants of the devaluation expectations of the forward-looking private sector; the disinflation in Russia was fast partly because it was credible.

Date: 2002-01
References: Add references at CitEc
Citations: View citations in EconPapers (18) Track citations by RSS feed

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nsr:niesrd:149

Access Statistics for this paper

More papers in National Institute of Economic and Social Research (NIESR) Discussion Papers from National Institute of Economic and Social Research 2 Dean Trench Street Smith Square London SW1P 3HE. Contact information at EDIRC.
Bibliographic data for series maintained by Library & Information Manager ().

 
Page updated 2019-08-12
Handle: RePEc:nsr:niesrd:149