IMF Staff Papers

IMF Staff Papers, Volume 49, No. 3

September 23, 2002

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Format: Chicago

International Monetary Fund. Research Dept. "IMF Staff Papers, Volume 49, No. 3", IMF Staff Papers 2002, 004 (2002), accessed April 12, 2025, https://doi.org/10.5089/9781589061224.024

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Summary

This paper empirically investigates the monetary impact of banking crises in Chile, Colombia, Denmark, Japan, Kenya, Malaysia, and Uruguay during 1975–98. Cointegration analysis and error correction modeling are used to research two issues: (i) whether money demand stability is threatened by banking crises; and (ii) whether crises lead to structural breaks in the relation between monetary indicators and prices. Overall, no systematic evidence that banking crises cause money demand instability is found. The paper also analyzes inflation targeting in the context of the IMF-supported adjustment programs.

Subject: Demand for money, Foreign exchange, Income inequality, Inflation, Inflation targeting, Monetary policy, Money, National accounts, Prices, Real exchange rates

Keywords: Adjustment program, Central Asia, Demand for money, East Asia, Europe, Income inequality, Inflation, Inflation targeting, Inflation targeting in the context, Middle East, Price equation, Real exchange rates, SP, Unemployment target, Wage, Wage inequality

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