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Monetary Policy Frameworks for Emerging Markets

Edited by Gill Hammond, Director, CCBS, Bank of England, UK, Ravi Kanbur, T.H. Lee Professor of World Affairs, Cornell University, US and Eswar Prasad, Tolani Senior Professor of Trade Policy, Cornell University, US
Financial globalization has made monetary policy formulation in emerging market economies increasingly complicated. This timely set of studies looks at the turmoil in global financial markets, which coupled with volatile inflation poses serious challenges for central banks in these countries. Featuring papers from the research frontier and front-line policymakers in developing and emerging market economies, the book addresses questions such as ‘What monetary policy framework is most suitable for these countries to confront the new challenges while they continue to open up to trade and financial flows?’, ‘What are the linkages between monetary stability and financial stability?’ and ‘Is inflation targeting or a fixed exchange rate regime preferable for developing and emerging markets?’
Extent: 368 pp
Hardback Price: £115.00 Web: £103.50
Publication Date: 2009
ISBN: 978 1 84844 442 3
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  • Development Studies
  • Development Economics
  • Development Studies
  • Economics and Finance
  • Development Economics
  • Money and Banking
Financial globalisation has made the formulation of monetary policy in emerging market economies increasingly complicated. This timely set of studies looks at the turmoil in global financial markets, which, coupled with volatile inflation, poses serious challenges for central banks in these countries.

The book features a number of specially commissioned new papers from both front-line policymakers and researchers in developing and emerging market economies, which tackle the difficult issues currently being debated with increasing urgency by monetary policy theorists and policymakers around the world. They address questions such as: ‘What monetary policy framework is most suitable for emerging market countries to confront the new challenges while they continue to open up to trade and financial flows?’, ‘What are the linkages between monetary stability and financial stability?’ and ‘Is inflation targeting or a fixed exchange rate regime preferable for developing and emerging markets?’

Providing unique insights on the interaction between the theory and practice of monetary policy in emerging markets, this book will be of great interest to academics and students of economics, economic policy and development economics. Policymakers will also find this to be a useful and thought-provoking read.
Contributors: P. Abradu-Otoo, C. Adam, W. Ramos de Alcântara, J. Aron, E. Buffie, P. Vieira da Cunha, J. De Gregorio, P. Disyatat, D. Dragutinovic, D. Fielding, M. Goodfriend, C. Goodhart, G. Hammond, D.H. Kalyalya, R. Kanbur, E. Levy-Yeyati, R. Mohan, J. Muellbauer, L. Niedermayer, B. Nijathaworn, S. O’Connell, M. Patra, C. Pattillo, D.S. Pires, E. Prasad, S. Singh, N.K. Sowa, F. Sturzenegger
Contents:

PART I: FRAMEWORKS FOR MONETARY POLICY
1. Monetary Policy Challenges for Emerging Market Economies
Gill Hammond, Ravi Kanbur and Eswar Prasad

2. The Pursuit of Monetary and Financial Stability in Emerging Market Economies
Bandid Nijathaworn and Piti Disyatat

3. Implementation of Inflation Targets in Emerging Markets
José De Gregorio

4. Whatever Became of the Monetary Aggregates?
Charles Goodhart

5. Fear of Appreciation: Exchange Rate Policy as a Development Strategy
Eduardo Levy-Yeyati and Federico Sturzenegger

6. Aid Reversals, Credibility and Macroeconomic Policy
Edward Buffie, Christopher Adam, Stephen O’Connell and Catherine Pattillo

PART II: COUNTRY EXPERIENCES
7. The Nexus between Monetary and Financial Stability: The Experience of Selected Asian Economies
Sukudhew Singh

8. A Framework for Independent Monetary Policy in China
Marvin Goodfriend and Eswar Prasad

9. Monetary Policy Transmission in India
Rakesh Mohan and Michael Patra

10. Inflation Targeting and Exchange Rate: Notes on Brazil’s Experience
Paulo Vieira da Cunha, Daniela Silva Pires and Wenersamy Ramos de Alcântara

11. Czech Experience with Inflation Targeting
Ludek Niedermayer

12. Monetary and Fiscal Policy Mix in Serbia: 2002–07
Diana Dragutinovic

13. Aid Volatility, Monetary Policy Rules and the Capital Account in African Economies
Christopher Adam, Stephen O’Connell and Edward Buffie

14. Regional Asymmetries in the Impact of Monetary Policy on Prices: Evidence from Africa
David Fielding

15. Monetary Policy and Inflation Modeling in a More Open Economy in South Africa
Janine Aron and John Muellbauer

16. Inflation Management and Monetary Policy Formulation in Ghana
Nii Kwaku Sowa and Philip Abradu-Otoo

17. Monetary Policy in Zambia: Experience and Challenges
Denny H. Kalyalya

Index