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CLAE Working Papers
Working papers from the Federal
Reserve Bank of Dallas are preliminary drafts circulated
for professional comment.
2005
| 2004 | 2003
| 2002 | 2001
| 1999
1999 Working Papers
0499 (Economic Research Working
Paper 9914)
Does
the Choice of Nominal Anchor Matter? [PDF]
David M. Gould
The conventional wisdom
on nominal anchors is that exchange rate-based inflation
stabilizations lead to economic booms while monetary-based
stabilizations lead to recessions. This study finds
strong evidence against this view. Rather than determining
the path of economic growth, the choice of nominal anchor
appears to be endogenously determined by the state of
the economy. To peg or manage the exchange rate, a high
level of international reserves is important, especially
when a government's credibility is low after a period
of high inflation. After controlling for the level of
international reserves and the rate of inflation, growth
after monetary-based stabilizations does not significantly
differ from that following exchange rate-based stabilizations.
0399 (Economic Research Working
Paper 9905)
When
Does Financial Liberalization Make Banks Risky? An Empirical
Examination of Argentina, Canada and Mexico [PDF]
William C. Gruben, Jahyeong Koo and Robert R. Moore
In the literature on systemic
banking crises, two common themes are: (1) lack of market
discipline encourages risky lending and (2) financial
liberalization or privatization lead to risky lending.
However, there is evidence to suggest that neither financial
liberalization nor weak market discipline always precedes
risky lending. We test for depositor discipline and,
separately for post-liberalization or post-privatization
risky lending in Argentina, Canada, and Mexico. In the
countries without market discipline, lending risk increases
significantly in the wake of liberalization. Where depositors
discipline banks, banks neither behave riskily nor does
their risk increase in the wake of privatization.
0299 (Economic Research Working
Paper 9913)
Is
Foreign-Currency Indexed Debt a Commitment Technology?
Some Evidence from Brazil and Mexico [PDF]
William C. Gruben and Darryl McLeod
We examine the effects
of foreign currency-indexed debt upon inflationary expectations
in Brazil and Mexico. Conjecturing that markets will
view increasing overhangs of foreign currency-indexed
debt as a commitment technology that fiscally punishes
devaluation, we test whether increasing such overhangs
will attenuate the effect of monetary growth upon inflationary
expectations. We find some econometric confirmation
of these conjectures in both the Brazilian and Mexican
cases. Finding that the results are consistent with
the notion that increasing the share of dollar indexed
debt may also permit some temporary monetary independence
even under pegged exchange rate regimes, we present
some evidence of independent policy behavior during
periods when are model results would suggest it.
0199 (Economic Research Working
Paper 9904)
Privatization,
Competition, and Supercompetition in the Mexican Commercial
Banking System [PDF]
William C. Gruben and Robert P. McComb
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