Generating a Sharp Disinflation: Israel 1985 / Michael Bruno.

By:

Bruno, Michael

Contributor(s):

National Bureau of Economic Research

Material type: Text

TextSeries: Working Paper Series (National Bureau of Economic Research) ; no. w1822.Publication details: Cambridge, Mass. National Bureau of Economic Research 1986.Description: 1 online resource: illustrations (black and white)Online resources:

Available additional physical forms:

Hardcopy version available to institutional subscribers

Abstract: On July 1 the Israeli government adopted a comprehensive emergency program for stabilization and recovery which has had dramatic consequences, at least in the very short-run. Within a few months inflation was down to 1-2 percent a month, foreign exchange reserves were rising rapidly andin spite of rather harsh contractionary fiscal and monetary policy measures average unemployment did not rise by more than 2 percentage points abovethe pre-July level.This paper deals with the background to the acute crisis of the Israeli economy and the conceptual underpinnings of the stabilization plan and with the first six months of its implementation. Apart from the more conventional fiscal and monetary policy measures, with partial deindexation, special emphasis is put on stabilization of the exchange rate, as a central nominal anchor for the price system, along with a wage policy package. Further budget restraint as well as wage moderation are considered the key for continued success of the stabilization effort. Both of these conditions will be tested in the new fiscal year starting April 1986.

Tags from this library: No tags from this library for this title. Log in to add tags.

Average rating: 0.0 (0 votes)

Holdings
Item type	Home library	Collection	Call number	Status	Date due	Barcode	Item holds
Working Paper	Biblioteca Digital	Colección NBER	nber w1822 (Browse shelf(Opens below))	Not For Loan

Total holds: 0

Collection: Colección NBER Close shelf browser (Hides shelf browser)

Previous	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	Next
Previous	nber w18217 Inefficient Investment Waves /	nber w18218 Unions in a Frictional Labor Market /	nber w18219 Optimal Holdings of International Reserves: Self-Insurance against Sudden Stop /	nber w1822 Generating a Sharp Disinflation: Israel 1985 /	nber w18220 Matching Contributions and Savings Outcomes: A Behavioral Economics Perspective /	nber w18221 The Spread of Manufacturing to the Poor Periphery 1870---2007 /	nber w18222 Prediction Markets for Economic Forecasting /	Next

1986.

On July 1 the Israeli government adopted a comprehensive emergency program for stabilization and recovery which has had dramatic consequences, at least in the very short-run. Within a few months inflation was down to 1-2 percent a month, foreign exchange reserves were rising rapidly andin spite of rather harsh contractionary fiscal and monetary policy measures average unemployment did not rise by more than 2 percentage points abovethe pre-July level.This paper deals with the background to the acute crisis of the Israeli economy and the conceptual underpinnings of the stabilization plan and with the first six months of its implementation. Apart from the more conventional fiscal and monetary policy measures, with partial deindexation, special emphasis is put on stabilization of the exchange rate, as a central nominal anchor for the price system, along with a wage policy package. Further budget restraint as well as wage moderation are considered the key for continued success of the stabilization effort. Both of these conditions will be tested in the new fiscal year starting April 1986.