Price Reform and Durable Goods in the Transition to a Market Economy

Author/Editor:

Pierre-Richard Agénor

Publication Date:

June 1, 1993

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 examines the short- and long-term effects of price liberalization in a reforming socialist economy. The analysis is based on an optimizing framework that highlights hoarding behavior and the existence of parallel goods markets. The behavior of official and parallel market prices, stock of durables, and the velocity of money in the transition period between reform announcement and reform implementation is characterized, in the presence and absence of uncertainty about the transition date.

Series:

Working Paper No. 1993/047

Subject:

Asset prices Financial institutions Financial services Inflation Price controls Prices Real interest rates Stocks

English

Publication Date:

June 1, 1993

ISBN/ISSN:

9781451972917/1018-5941

Stock No:

WPIEA0471993

Pages:

36

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