dc.contributor.author |
Goswami, Samrat
|
|
dc.contributor.author |
Gupta, Rangan
|
|
dc.date.accessioned |
2010-04-08T06:26:46Z |
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dc.date.available |
2010-04-08T06:26:46Z |
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dc.date.issued |
2009 |
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dc.description.abstract |
The paper develops a monetary endogenous growth model of a financially repressed small open economy, characterized by curb markets, capital mobility, transaction costs in domestic and foreign capital markets, and a flexible exchange rate system, to analyze the impact of financial liberalization - interest rate deregulation and lower multiple reserve requirements - on growth and inflation. When the model is calibrated to match world figures, we find that interest rate deregulation enhances growth and reduces inflation in steady-state. For relatively smaller transaction costs in the curb market, the above result is, however, reversed. Under such circumstances, lowering the transaction costs in the foreign capital market tends to restore the growth-enhancing (inflation-reducing) capabilities of interest rate deregulation. Lower reserve requirements, though, always ensures lower (higher) steady-state inflation (growth). |
en |
dc.identifier.citation |
Goswami, S & Gupta, R 2009, 'An endogenous growth model of a financially repressed small open economy', International Economic Journal, vol. 23, no. 1, pp. 143-161. [ http://www.tandf.co.uk/journals/titles/10168737.asp] |
en |
dc.identifier.issn |
1016-8737 |
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dc.identifier.other |
10.1080/10168730802696772 |
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dc.identifier.uri |
http://hdl.handle.net/2263/13848 |
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dc.language.iso |
en |
en |
dc.publisher |
Taylor & Francis |
en |
dc.rights |
Taylor & Francis. This is an electronic version of an article published in International Economic Journal, vol. 23, no. 1, pp. 143-161. International Economic Journal is available online at: http://www.tandf.co.uk. This article is embargoed by the publisher until December 2011. |
en |
dc.subject |
Financial repression |
en |
dc.subject |
Growth and inflation |
en |
dc.subject |
Unofficial financial markets |
en |
dc.subject |
Interest rate deregulation |
en |
dc.subject.lcsh |
Inflation (Finance) |
en |
dc.subject.lcsh |
Economic development |
en |
dc.subject.lcsh |
Endogenous growth (Economics) |
en |
dc.subject.lcsh |
Monetary policy |
en |
dc.subject.lcsh |
Interest rates -- Effect of inflation on |
en |
dc.title |
An endogenous growth model of a financially repressed small open economy |
en |
dc.type |
Postprint Article |
en |