Stabilization and growth in transition economies: The early experience
Ratna Sahay and
Carlos Vegh ()
MPRA Paper from University Library of Munich, Germany
This paper analyzes the growth and stabilization experience in 26 transition economies in eastern Europe, the former Soviet Union, and Mongolia for the period 1989-1994. Inflation rates have declined significantly in most countries following an inflation stabilization program. Growth resumes after stabilization occurs, typically with a lag of about two years. Reducing inflation thus appears to be a precondition for growth. An econometric analysis of the short-run determinants of inflation and growth illustrates the key roles of fixed exchange rates, improved fiscal balances, and structural reforms in spurring growth and lowering inflation, and confirms that inflation stabilization programs have been beneficial for growth even after controlling for structural reforms.
Keywords: Transition; Eastern Europe; growth; reforms; stabilization; inflation; fixed exchange rates (search for similar items in EconPapers)
JEL-codes: P20 F41 F43 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (155) Track citations by RSS feed
Downloads: (external link)
https://mpra.ub.uni-muenchen.de/20631/1/MPRA_paper_20631.pdf original version (application/pdf)
Journal Article: Stabilization and Growth in Transition Economies: The Early Experience (1997)
Journal Article: Stabilization and Growth in Transition Economies: The Early Experience (1996)
Working Paper: Stabilization and Growth in Transition Economies; The Early Experience (1996)
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:pra:mprapa:20631
Access Statistics for this paper
More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().