Recoveries in the Middle East, North Africa, and Pakistan : Have Macroeconomic Policies Been Effective?

Author/Editor:

Francesco Grigoli ; Dalia S Hakura

Publication Date:

May 1, 2010

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper identifies and documents the properties of output gap recessions and recoveries in the Middle East, North Africa, and Pakistan (MENAP) during the 1980 to 2008 period. It goes on to investigate the key determinants of the recoveries. The duration of MENAP countries’ recessions and recoveries has increased from the 1990s to the 2000s. MENAP hydrocarbon exporting countries’ recessions were on average more pronounced in the 2000s, and hydrocarbon importing countries’ recessions milder. Fiscal policy is found to have played a key role during the recoveries to potential output, although with weaker effects for MENAP countries that are more open to trade. Monetary policy is found to have been less effective. This is likely to be related to the fact that many of the MENAP countries have fixed exchange rate regimes and hence have limited room for active monetary policy.

Series:

Working Paper No. 10/122

Subject:

English

Publication Date:

May 1, 2010

ISBN/ISSN:

9781455200818/1018-5941

Stock No:

WPIEA2010122

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

30

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