Internal Currency Markets and Production in the Soviet Union

29 Pages Posted: 10 Oct 2007

See all articles by Linda S. Goldberg

Linda S. Goldberg

Federal Reserve Bank of New York; National Bureau of Economic Research (NBER)

Il'dar Karimov

affiliation not provided to SSRN

Date Written: February 1991

Abstract

This paper considers the impact of macroeconomic and microeconomic policy tools on enterprise activities within an economy in the process of economic reform. Assuming a dual exchange rate regime and the type of increased enterprise autonomy introduced as components of partial economic reform as in the Soviet Union, policy changes induce shifts in production and hard currency allocation decisions. This paper considers the implications for: the supply of hard currency to internal auctions or interbank markets; the free internal price of foreign exchange; export volumes; the trade balance; the supply of goods available for internal consumption; and open and hidden inflation. The concentration of market power of producers in domestic industries and the design of currency auctions or interbank markets are key determinants, respectively, of the magnitude and direction of the enterprise responses to policy changes and external shocks.

Suggested Citation

Goldberg, Linda S. and Karimov, Il'dar, Internal Currency Markets and Production in the Soviet Union (February 1991). NBER Working Paper No. w3614. Available at SSRN: https://ssrn.com/abstract=471556

Linda S. Goldberg (Contact Author)

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
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212-720-2836 (Phone)
212-720-6831 (Fax)

National Bureau of Economic Research (NBER)

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Cambridge, MA 02138
United States

Il'dar Karimov

affiliation not provided to SSRN

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