A General Equilibrium Model with Informal Financial Markets

Publication Date:

February 1, 1991

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:

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.

Series:

Working Paper No. 1991/018

Subject:

Bank credit Commercial banks Currency markets Exchange rates Foreign assets

English

Publication Date:

February 1, 1991

ISBN/ISSN:

9781451843576/1018-5941

Stock No:

WPIEA0181991

Pages:

50

Please address any questions about this title to publications@imf.org