From the Debt Crisis Toward Economic Stability: An Analysis of the Consistency of Macroeconomic Policies in Mexico

44 Pages Posted: 15 Feb 2006

Date Written: March 1992

Abstract

This paper uses a simple framework based on the government budget constraint to analyze the consistency of macroeconomic policies undertaken in Mexico during the period 1978 to mid-1991. It was found that the interaction between the actual implementation of economic policies and economic agents` perceptions about the sustainability of those policies can account, to a large extent, for the behavior of key macroeconomic variables during the period under study. The paper also highlights the costs of adjustment involved in the most recent Mexican stabilization program arising from concerns about the sustainability of the announced policies.

JEL Classification: E3, E6, O54

Suggested Citation

Rojas-Suarez, Liliana, From the Debt Crisis Toward Economic Stability: An Analysis of the Consistency of Macroeconomic Policies in Mexico (March 1992). IMF Working Paper No. 92/17, Available at SSRN: https://ssrn.com/abstract=884623

Liliana Rojas-Suarez (Contact Author)

Center for Global Development ( email )

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