Testing for Credibility Effects

38 Pages Posted: 15 Feb 2006

See all articles by Pierre-Richard Agenor

Pierre-Richard Agenor

University of Manchester - School of Social Sciences

Date Written: November 1991


This paper examines some recent techniques designed to draw inferences about the credibility of changes in macroeconomic policy regimes. An alternative two-step approach, based on the decomposition between permanent and transitory components of a "credibility variable" is proposed. The methodology is then used to test for the existence of a credibility effect in the Cruzado stabilization plan implemented in Brazil in 1986.

JEL Classification: C4, E3, E6

Suggested Citation

Agenor, Pierre-Richard, Testing for Credibility Effects (November 1991). IMF Working Paper, Vol. , pp. 1-33, 1991. Available at SSRN: https://ssrn.com/abstract=885131

Pierre-Richard Agenor (Contact Author)

University of Manchester - School of Social Sciences ( email )

Oxford Road
Manchester, M13 9PL
United Kingdom

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