Issues in the choice of a monetary regime for India

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dc.contributor.authorSingh, Kanhaiya
dc.contributor.authorMcKibbin, Warwick
dc.contributor.editoren_AU
dc.contributor.editoren_AU
dc.date.accessioned2003-07-21en_US
dc.date.accessioned2004-05-19T07:37:16Zen_US
dc.date.accessioned2011-01-05T08:25:21Z
dc.date.available2004-05-19T07:37:16Zen_US
dc.date.available2011-01-05T08:25:21Z
dc.date.created2000en_US
dc.date.updated2015-12-11T09:36:19Z
dc.description.abstractEconomic liberalization and financial sector reforms in India commenced in 1990. An important issue currently facing India and the focus of a lively debate, is the question of the appropriate regime for conducting monetary policy in an economy undergoing structural reforms. To add to this important debate, this paper summarizes the state of the current policy debate on selecting a monetary regime for India and presents estimates of the impact of alternative monetary regimes in the face of a variety of shocks to the Indian economy. The impacts of shocks to aggregate demand, productivity growth and risk perceptions are considered under the three policy regimes of money targeting, inflation targeting and nominal income targeting. It is concluded that a monetary target performs worst among the three regimes while the results of income targeting are most encouraging. Inflation targeting only performs well for demand shocks but causes greater volatility in real output under both productivity shocks and risk reassessment shocks. As there is a general trend towards inflation targeting in industrialized economies, this particular results should give some caution to Indian monetary authorities in following the industrialized world in their choice of an inflation-targeting regime. The most likely shocks to face India in a period of structural reform are different to those facing industrialized economies and are less well handled under an inflation target regime compared to a nominal income-targeting regime.en_AU
dc.format.extent61 pages
dc.format.mimetypeapplication/pdfen_US
dc.identifier.isbn1843760568
dc.identifier.urihttp://hdl.handle.net/1885/40321en_US
dc.language.isoen_AUen_US
dc.publisherCanberra, ACT: Economics Division, Research School of Asia and the Pacific, The Australian National Universityen_AU
dc.relation.ispartofseriesWorking Paper; no.2000/01en_AU
dc.source.urihttps://taxpolicy.crawford.anu.edu.au/acde/asarc/pdf/papers/2000/WP2000_01.pdfen_AU
dc.subjectIndia
dc.subjectmonetary regime
dc.subjectmoney targeting
dc.subjectinflation targeting
dc.subjectnominal income targeting
dc.subjectMSG2 model
dc.subjectalternative monetary regimes
dc.subjectpersistent demand
dc.subjecttemporary demand
dc.titleIssues in the choice of a monetary regime for India
dc.typeWorking/Technical Paper
dcterms.accessRightsOpen Accessen_AU
local.contributor.affiliationANUen_US
local.contributor.affiliationASARC, RSPASen_US
local.contributor.authoruidMcKibbin, Warwick, u9001518
local.description.refereednoen_US
local.identifier.absfor140212 - Macroeconomics (incl. Monetary and Fiscal Theory)
local.identifier.ariespublicationMigratedxPub5916
local.identifier.citationmonthmayen_US
local.identifier.citationyear2000en_US
local.identifier.eprintid1738en_US
local.identifier.uidSubmittedByMigrated
local.rights.ispublishedyesen_US
local.type.statusPublished Versionen_AU

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