Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This work employs a dynamic general equilibrium model to evaluate the causes and implications of bank insolvencies. The model is applied to stylized data from several South Asian countries. It derives conclusions about policy instruments designed to alleviate the impact of insolvencies. Firms are subject to intertemporal solvency conditions, and the public withdraws deposits when borrowers default. If banks optimize by restricting credit to risky borrowers, these failures can be partially avoided. Numerical simulations conclude that the combination of compensating monetary policy and restrictive fiscal policy offers the best way of responding to a bank crisis caused by exogenous shocks.

Banks and Banking --- Finance: General --- Public Finance --- Industries: Financial Services --- Macroeconomics --- Computable and Other Applied General Equilibrium Models --- Comparative or Joint Analysis of Fiscal and Monetary Policy --- Stabilization --- Treasury Policy --- National Deficit Surplus --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- General Financial Markets: Government Policy and Regulation --- Debt --- Debt Management --- Sovereign Debt --- Labor Economics: General --- Banking --- Finance --- Public finance & taxation --- Labour --- income economics --- Commercial banks --- Bank deposits --- Distressed assets --- Government debt management --- Financial institutions --- Financial sector policy and analysis --- Public financial management (PFM) --- Loans --- Labor --- Banks and banking --- Debts, Public --- Labor economics --- Mexico --- Income economics

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

We construct a dynamic general equilibrium model of an open economy and use it to examine issues of trade liberalization in Mexico. In particular, we consider the fiscal implications of quotas and tariffs and, accordingly, their removal. We show that, in the short run, there may be negative revenue effects from tariff liberalization, so that it may be necessary to raise domestic taxes to compensate for the tariff reduction. We also show that these results are highly sensitive to behavioral shifts in exports. Since such shifts are quite likely given the nature of the trade reform currently being undertaken, it is important that we qualify our results accordingly.

Budgeting --- Exports and Imports --- Foreign Exchange --- Macroeconomics --- Taxation --- Fiscal Policy --- Empirical Studies of Trade --- Trade Policy --- International Trade Organizations --- National Budget --- Budget Systems --- Trade: General --- Price Level --- Inflation --- Deflation --- Public finance & taxation --- Budgeting & financial management --- Currency --- Foreign exchange --- International economics --- Tariffs --- Budget planning and preparation --- Exchange rates --- Imports --- Wholesale price indexes --- Taxes --- Public financial management (PFM) --- International trade --- Prices --- Tariff --- Budget --- Price indexes --- Mexico

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper reviews briefly the controversy in the literature concerning the speed of adjustment and sequencing of reforms, and presents a model parameterized with Chinese data. The model is used to generate different policy simulations to illustrate some of the key issues in the debate on the speed and sequencing of reforms, and not to provide a basis for policy recommendations for China. The simulations highlight the importance of the criteria being used for determining speed and sequencing. The paper also underscores the limitations involved in attempting to derive conclusions from the model, given the complexity of the issues.

Budgeting --- Exports and Imports --- Macroeconomics --- Computable and Other Applied General Equilibrium Models --- Socialist Systems and Transitional Economies: Planning, Coordination, and Reform --- Comparison of Public and Private Enterprises and Nonprofit Institutions --- Privatization --- Contracting Out --- Current Account Adjustment --- Short-term Capital Movements --- Labor Economics: General --- National Budget --- Budget Systems --- Nonprofit Organizations and Public Enterprise: General --- Public Enterprises --- Public-Private Enterprises --- International economics --- Labour --- income economics --- Budgeting & financial management --- Public ownership --- nationalization --- Civil service & public sector --- Current account --- Labor --- Budget planning and preparation --- Public enterprises --- Economic sectors --- Balance of payments --- Public sector --- Labor economics --- Budget --- Government business enterprises --- Finance, Public --- China, People's Republic of --- Income economics --- Nationalization

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper examines alternative ways to prevent losses from bank insolvencies. It is widely viewed that transparency in reporting bank balance sheets is a key element in reducing such losses. It is, however, unclear just how such transparency would be achieved. Current approaches to avoiding insolvencies generally involve international enforcement mechanisms. Among these are the sovereign debt restructuring mechanism (SDRM), and, more generally, an international bankruptcy court. We develop a model that compares two alternative institutions for bank auditing. Neither of these institutions would require as much enforcement capability as an international bankruptcy court, hence they would be easier to introduce. The first of these is a system of central bank auditing of national banks. The second type of auditing is carried out by an international agency that collects risk information on banks in all countries and then provides it to depositors. Using a game-theoretic approach, we compare the informativeness of the disclosure rule in the symmetric Perfect Bayesian equilibrium in each of the two different auditing institutions. We show that the international auditor generally performs at least as well, and sometimes better than, auditing by either central banks, which, in turn, perform better than voluntary disclosure by the banks themselves. The results do not assume any informational advantages of the international auditor, nor is the international auditor somehow less "corrupt" than the central banks. Rather, the international auditor's credibility comes from the simple fact that its incentives are not distorted by a sovereignty bias that plagues the central banks.

Bank failures. --- Banks and banking, Central. --- Auditing, Internal. --- Auditing --- Internal auditing --- Banker's banks --- Banks, Central --- Central banking --- Central banks --- Banks and banking --- Failure of banks --- Business failures --- Internal control --- Banks and Banking --- Finance: General --- Public Finance --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Bankruptcy --- Liquidation --- Central Banks and Their Policies --- Banking --- Finance --- Management accounting & bookkeeping --- Bank solvency --- Central bank auditing --- Solvency --- Financial sector policy and analysis --- Public financial management (PFM) --- Commercial banks --- Financial institutions --- Debt --- United States

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

One objective of government investment is to develop public infrastructure which may reduce private sector costs. In a developing economy, the scope for payoffs to investments of this sort may be particularly large. A major concern related to the recent fiscal adjustment in Mexico is that it has been carried out, in part, by depleting public infrastructure stocks.We estimate the effects of public infrastructure on private sector costs in Mexico and calculate the implied optimal infrastructure stocks. Our estimates indicate that previous results suggesting a large productive role of public infrastructure capital are not robust. There is little evidence that public infrastructure plays a large role in reducing private sector costs.

Infrastructure --- Investments: Stocks --- Public Finance --- Investment --- Capital --- Intangible Capital --- Capacity --- Industry Studies: Transportation and Utilities: General --- Pension Funds --- Non-bank Financial Institutions --- Financial Instruments --- Institutional Investors --- Taxation, Subsidies, and Revenue: General --- National Government Expenditures and Related Policies: Infrastructures --- Other Public Investment and Capital Stock --- Public Goods --- Macroeconomics --- Public finance & taxation --- Investment & securities --- Transportation --- Stocks --- Communications in revenue administration --- Public investment spending --- National accounts --- Financial institutions --- Revenue administration --- Expenditure --- Saving and investment --- Revenue --- Public investments --- Mexico