Alternative Paths to Structural Adjustment in Uzbekistan in a Three-Gap Framework

29 Pages Posted: 20 Apr 2016  

Thilak Ranaweera

World Bank

Date Written: September 2003

Abstract

Ranaweera presents an internally consistent macroeconomic framework that could be used as a first step toward a more comprehensive quantitative and qualitative assessment of the adjustment alternatives facing Uzbekistan. The three-gap framework focuses on the major imbalances of the economy for evaluating policy choices facing Uzbekistan. It emphasizes the domestic and external factors that determine economic outcomes and welfare. The author attempts to quantify two policy scenarios - gradual as against an accelerated policy implementation strategy. He finds that an aggressive adjustment policy would indeed improve most performance and welfare indicators. Two major ingredients of such an aggressive adjustment strategy are the unification of the exchange rate and implementation of current account convertibility in the balance of payments. The author also draws attention to the relative importance of external financing and the sustainability of the balance of payments under alternative structural adjustment paths facing Uzbekistan.

This paper - a product of the Development Data Group, Development Economics Senior Vice Presidency - is part of an ongoing effort in the group to improve quantitative analytical tools for country assistance strategies.

Suggested Citation

Ranaweera, Thilak, Alternative Paths to Structural Adjustment in Uzbekistan in a Three-Gap Framework (September 2003). World Bank Policy Research Working Paper No. 3145. Available at SSRN: https://ssrn.com/abstract=636564

Thilak Ranaweera (Contact Author)

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

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