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This paper develops a simple model of foreign debt portfolio management. The model suggests that, under mild conditions, the currency composition of a country's foreign debt portfolio is responsive to exchange rate movements. Empirical evidence is provided for a panel of 14 emerging economies in the period 1970-98. Attention is focused on the stocks of foreign liabilities denominated in U.S. dollars, deutsche marks (DM), Japanese yen, and Swiss francs. The results of the empirical analysis show that foreign debt portfolio management has been sub-optimal in the countries under examination. In these countries, the currency composition of foreign debt has not reflected a substitution effect away from the currencies that have appreciated over time vis-à-vis the U.S. dollar.

Exports and Imports --- Financial Risk Management --- Foreign Exchange --- Money and Monetary Policy --- Public Finance --- International Lending and Debt Problems --- Time-Series Models --- Dynamic Quantile Regressions --- Dynamic Treatment Effect Models --- Diffusion Processes --- Debt --- Debt Management --- Sovereign Debt --- Monetary Systems --- Standards --- Regimes --- Government and the Monetary System --- Payment Systems --- International economics --- Currency --- Foreign exchange --- Public finance & taxation --- Monetary economics --- Finance --- External debt --- Exchange rates --- Government debt management --- Currencies --- Debt management --- Money --- Public financial management (PFM) --- Asset and liability management --- Debts, External --- Debts, Public --- United States

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Africa is the world’s poorest continent, but amid all the bad news, there is hope for change. This pamphlet examines the lessons to be learned from some of the more successful economies south of the Sahara, and discusses a policy framework to promote sustainable economic growth and reduce poverty across the region.

Economic development --- Capacity --- Capital --- Debt Management --- Debt --- Debts, Public --- Domestic savings --- Export performance --- Exports and Imports --- Exports --- Government debt management --- Institutions and the Macroeconomy --- Intangible Capital --- International economics --- Investment --- Investments: General --- Macroeconomics --- Macroeconomics: Consumption --- Private investment --- Public finance & taxation --- Public Finance --- Saving and investment --- Saving --- Sovereign Debt --- Structural reforms --- Trade: General --- Wealth

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África es el continente más pobre del mundo, pero en medio de todas las malas noticias, hay esperanza de cambio. Este folleto examina las lecciones que debemos aprender de algunas de las economías más exitosas de África Subsahariana, y expone un marco de políticas para promover el crecimiento económico sostenible y reducir la pobreza en toda la región.

Exports and Imports --- Investments: General --- Macroeconomics --- Public Finance --- Investment --- Capital --- Intangible Capital --- Capacity --- Debt --- Debt Management --- Sovereign Debt --- Macroeconomics: Consumption --- Saving --- Wealth --- Institutions and the Macroeconomy --- Trade: General --- Public finance & taxation --- International economics --- Private investment --- Government debt management --- Domestic savings --- Structural reforms --- Export performance --- Saving and investment --- Debts, Public --- Exports

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Empirical studies have had little success in finding a statistically significant relationship between fiscal deficits and inflation in broad cross-country panels. This paper provides new econometric estimates for a panel of 23 emerging market countries during 1970-2000. Unlike previous studies, we allow for a rich dynamic specification and focus on the long-run relationship between the two variables controlling for differences in the inflation tax base. We find that a 1 percentage point reduction in the ratio of fiscal deficit to GDP typically lowers long-run inflation by 1½ to 6 percentage points, depending on the size of the inflation tax base.

Exports and Imports --- Foreign Exchange --- Inflation --- Macroeconomics --- Public Finance --- Price Level --- Deflation --- Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook: General --- Debt --- Debt Management --- Sovereign Debt --- Energy: Demand and Supply --- Prices --- International Lending and Debt Problems --- Public finance & taxation --- Currency --- Foreign exchange --- International economics --- Government debt management --- Oil prices --- Exchange rate arrangements --- Interest payments --- Public financial management (PFM) --- External debt --- Debts, Public --- Debt service --- United States

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This paper examines the implications of central bank independence for equilibrium macroeconomic performance. The focus is on institutional arrangements governing financial relationships between central banks and ministries of finance, in the presence of competing objectives and constraints across institutions. Abstracting from long-run considerations, higher central bank independence increases fiscal discipline and results in lower inflation and growth, generating a short-run institutional Phillips curve. In the presence of sufficiently strong negative long-run externalities of inflation onto growth, higher CBI also increases fiscal discipline and generates lower inflation, however, it also yields higher growth and generates an inverted institutional Phillips curve. Strikingly, higher central bank independence is found to be frequently sub-optimal for a wide set of stylized economies. Whether these economies are empirically relevant is an open question.

Banks and Banking --- Inflation --- Public Finance --- Macroeconomics and Monetary Economics: General --- Central Banks and Their Policies --- Policy Objectives --- Policy Designs and Consistency --- Policy Coordination --- Comparative or Joint Analysis of Fiscal and Monetary Policy --- Stabilization --- Treasury Policy --- Price Level --- Deflation --- Debt --- Debt Management --- Sovereign Debt --- Taxation, Subsidies, and Revenue: General --- Macroeconomics --- Public finance & taxation --- Banking --- Government debt management --- Central bank autonomy --- Government debt planning --- Institutional arrangements for revenue administration --- Prices --- Debts, Public --- Revenue