A General Equilibrium Model with Informal Financial Markets
February 1, 1991
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Summary
The paper presents a general equilibrium framework for short-run macroeconomic analysis in a developing country context where controls on interest rates and foreign exchange restrictions lead to the emergence of informal financial markets. The complexity of the model precludes an analytical treatment. A simulation approach, based on parameters derived from estimates in the existing literature, is used to assess the properties of the model, which differ in important ways from those of standard open-economy models.
Subject: Bank credit, Commercial banks, Currency markets, Exchange rates, Foreign assets
Keywords: central bank, foreign currency, interest rate, WP
Pages:
50
Volume:
1991
DOI:
Issue:
018
Series:
Working Paper No. 1991/018
Stock No:
WPIEA0181991
ISBN:
9781451843576
ISSN:
1018-5941
