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Using a VAR approach, this paper studies the relationship between money, output, and prices in a group of Pacific Basin countries that underwent financial sector reform during the 1980s: Indonesia, Korea, and the Philippines. Special attention is paid to assessing the information content of money. Money was found to contain valuable advance information on output and prices in Korea, on prices only in the Philippines, and did not contain any advance information in Indonesia. The introduction of financial sector reform was not found to lead to a structural break in the price and output equations; however, the information content of money was affected. Further tests show that exchange and interest rates—variables that gained flexibility with the reforms—contain valuable information about future developments in prices in Korea and the Philippines.

Finance: General --- Foreign Exchange --- Money and Monetary Policy --- Monetary Policy, Central Banking, and the Supply of Money and Credit: General --- General Financial Markets: Government Policy and Regulation --- Monetary Systems --- Standards --- Regimes --- Government and the Monetary System --- Payment Systems --- Monetary Policy --- Monetary economics --- Financial services law & regulation --- Currency --- Foreign exchange --- Financial sector reform --- Monetary aggregates --- Currencies --- Monetary base --- Exchange rates --- Financial regulation and supervision --- Money --- Money supply --- Financial services industry --- Korea, Republic of

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Italy’s pension system was reformed in August 1995. The new system has various desirable long-run properties and, overall, it represents an improvement over earlier systems. However, it fails to address two longstanding problems: extremely high contribution rates, and a lack of provisions for dealing with the substantial deterioration in demographic ratios expected over the next 30-40 years.

Labor --- Public Finance --- Demography --- Social Security and Public Pensions --- Nonwage Labor Costs and Benefits --- Private Pensions --- Retirement --- Retirement Policies --- Economics of the Elderly --- Economics of the Handicapped --- Non-labor Market Discrimination --- Demographic Trends, Macroeconomic Effects, and Forecasts --- Pensions --- Population & demography --- Labour --- income economics --- Pension spending --- Aging --- Demographic change --- Expenditure --- Population and demographics --- Population aging --- Demographic transition --- Italy --- Income economics

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This paper compares the experience with exchange-rate–based stabilization (ERBS) of four Western European countries with that of high-inflation developing countries. In general, the behavior of key macroeconomic variables—inflation, output, demand, the real exchange rate and the current account—in the four countries examined did not correspond to the pattern observed in developing countries, although some resemblance to this pattern could be found in Italy in 1987–92 and Greece in 1994–96. The experience with ERBS in Western Europe highlights the importance of incomes policy as an ingredient of a successful stabilization program and shows that the adoption of a looser anchor does not necessarily reduce the output cost of disinflation.

Foreign Exchange --- Inflation --- Macroeconomics --- Price Level --- Deflation --- Open Economy Macroeconomics --- Fiscal Policy --- Currency --- Foreign exchange --- Exchange rates --- Real exchange rates --- Fiscal consolidation --- Disinflation --- Prices --- Fiscal policy --- Italy

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Many inflation stabilizations succeed only temporarily. Using a sample of 51 episodes of stabilization from inflation levels above 40 percent, we show that most of the failures are explained by bad luck, unfavorable initial conditions, and inadequate political institutions. The evolution of trading partners' demand and U.S. interest rates captures the effect of bad luck. Past inflation affects the outcome in two different ways: a long history of high inflation makes failure more likely, while a high level of inflation prior to stabilization increases the chances of success. Countries with short-lived political institutions, a weak executive authority, and proportional electoral rules also tend to fail. After controlling for all these factors, we find that exchange-rate-based stabilizations are more likely to succeed. These findings are robust across measures of failure (two dichotomous and one continuous), sample selection criteria, and estimation techniques, including Heckman's correction for the endogeneity of the anchor.

Econometrics --- Foreign Exchange --- Inflation --- Macroeconomics --- Money and Monetary Policy --- Price Level --- Deflation --- Comparative or Joint Analysis of Fiscal and Monetary Policy --- Stabilization --- Treasury Policy --- Fiscal Policy --- Monetary Policy --- Estimation --- Monetary economics --- Econometrics & economic statistics --- Currency --- Foreign exchange --- Fiscal consolidation --- Exchange rate anchor --- Estimation techniques --- Real exchange rates --- Prices --- Fiscal policy --- Monetary policy --- Econometric analysis --- Econometric models --- Argentina

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The positive impact of foreign aid is limited by the erratic behavior of aid flows. The introduction in 1999 of various initiatives anchored in Poverty Reduction Strategy Papers (PRSPs) which were aimed at strengthening coordination among donors, improving the design of financial support programs, and improving domestic records of policy implementation should have led to an improvement in the time series properties of aid flows. We find no evidence of any fundamental changes in the way aid has been delivered in the past five years. If anything, aid volatility has worsened somewhat and the information value of long-term lending commitments has declined. We take these results to mean that the main causes of the volatility and unpredictability of aid, and the broader issue of macroeconomic instability in low-income countries, have not been addressed in a systematic manner by the donor community.

Economic assistance. --- Electronic books. -- local. --- International economic relations. --- Business & Economics --- Economic History --- Economic policy, Foreign --- Economic relations, Foreign --- Economics, International --- Foreign economic policy --- Foreign economic relations --- Interdependence of nations --- International economic policy --- International economics --- New international economic order --- Economic aid --- Foreign aid program --- Foreign assistance --- Grants-in-aid, International --- International economic assistance --- International grants-in-aid --- Economic policy --- International relations --- Economic sanctions --- International economic relations --- Conditionality (International relations) --- Exports and Imports --- Finance: General --- Foreign Exchange --- Industries: Financial Services --- Foreign Aid --- General Financial Markets: Government Policy and Regulation --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Finance --- Currency --- Foreign exchange --- Aid flows --- Development assistance --- Procyclicality --- Purchasing power parity --- Loans --- Economic assistance --- International relief --- Financial risk management --- United States