Monetary Commitment and Structural Reforms – A Dynamic Panel Analysis for Transition Economies

28 Pages Posted: 4 Aug 2012

See all articles by Ansgar Hubertus Belke

Ansgar Hubertus Belke

University of Duisburg-Essen - Department of Economics and Business Administration; IZA Institute of Labor Economics; Centre for European Policy Studies

Lukas Vogel

affiliation not provided to SSRN

Multiple version iconThere are 3 versions of this paper

Date Written: June 1, 2012

Abstract

This paper examines the contemporaneous relationship between the exchange rate regime and structural economic reforms for a sample of CEEC/CIS transition countries. We investigate empirically whether structural reforms are complements or substitutes for monetary commitment in the attempt to improve macroeconomic performance. Both EBRD and EFW data suggest a negative relationship between flexible exchange rate arrangements and external liberalization. Another finding from the EFW sample is that economic liberalisation has tended to be stronger under better macroeconomic fundamentals, suggesting that the impact of good macroeconomic conditions as facilitating structural reforms outweighs countervailing effects in the sense of lower reform pressure.

Keywords: Exchange rate regime, structural reform, panel data, political economy of reform, transition countries

JEL Classification: D78, E52, E61, F36

Suggested Citation

Belke, Ansgar Hubertus and Vogel, Lukas, Monetary Commitment and Structural Reforms – A Dynamic Panel Analysis for Transition Economies (June 1, 2012). Ruhr Economic Paper No. 347, Available at SSRN: https://ssrn.com/abstract=2122487 or http://dx.doi.org/10.2139/ssrn.2122487

Ansgar Hubertus Belke (Contact Author)

University of Duisburg-Essen - Department of Economics and Business Administration ( email )

Universitätsstr. 9
Essen, 45141
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Centre for European Policy Studies ( email )

1 Place du Congres, 1000
Brussels, 1000
Belgium

Lukas Vogel

affiliation not provided to SSRN ( email )

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