1. "Economic Policymaking with Little Information and Few Instruments: The Process of Macro Control in Mexico".
- Author
-
Brewer, Garry D., Koehler, John E., and Brunner, Ronald D.
- Abstract
Since the early 1950s, Mexico has experienced growth with respectable stability. Public expenditure and private autonomous expenditure have moved in offsetting ways, but the burden of adjustment has been carried by private investment, rather than by public expenditure. Level of private investment has been controlled by manipulation of the level of reserves that private financial institutions are required to deposit in the central bank. Banco de Mexico. This manipulation is based on the monitoring of two variables: the rate of growth of the money supply and the rate of change of foreign exchange reserves. Because of the structure of the economy, these data generally give consistent, meaningful, and timely signals for policy change. From time to time, however, they give contradictory signals, causing the policy‐making system to fail. This system may not be optimal, but it is viable, appropriate, and applicable to other countries at similar stages of development. [ABSTRACT FROM PUBLISHER]
- Published
- 1975