Marko Škreb

Macroeconomic Stabilization in Transition Economies

The essays in this volume explore the special type of policies that were needed in the post-socialist countries of Eastern Europe and the former Soviet Union in order to reduce inflation and to stop the fall in output that followed the collapse of Communism. The book contains a number of general studies that discuss the type of reforms needed and how they condition policies and analyse the aggregate relationship between reducing inflation, implementing structural reforms, and renewing the process of growth. It includes a number of country studies (on the Baltics, Croatia, Hungary, Poland, Slovenia and the Ukraine) about their stabilization experiences. Thus the emerging picture is one of renewal of growth in those countries that proceeded early and with the determination to implement market-oriented reforms and to stabilize their macroeconomy, and of gradual and slow stabilization of output in those countries that entered the process only very recently.

Balance of Payments, Exchange Rates, and Competitiveness in Transition Economies

Transition and the Open Economy: An Overview.- Transition and the Open Economy: An Overview.- Exchange-Rate Policies and the Balance of Payments.- Current-Account Sustainability in Transition Economies.- Exchange-Rate Arrangements in the Transition Economies.- Toward Virtual Exchange-Rate Stability in Western and Eastern Europen with the Advent of EMU.- A Model of Real Exchange-Rate Determination in Transition Economies.- Financing the Transition to a Market Economy: External Borrowing in the Baltics and CIS Region.- Capital Flows and Stability of Financial Systems in Emerging Countries.- Transition and International Trade.- Geographic Diversification of Trade in Transition Economies.- The Fiscal Implications of Trade Liberalization in Transition Countries.- What is Special about Endogenous International Trade Policy in Transition Economies?.- Selected Country Experiences.- External Deficit, Exchange Rate, and Competitiveness in Croatia: Is There a Problem?.- Exchange-Rate Policy in the Czech Republic: The Perils of Sticking to Fixed Exchange Rates.- Trade, Trade Policy, and Foreign-Exchange Regimes Under Transition: Russia and the Dutch Disease.- Balance of Payments, Exchange Rates, and Competitiveness: Lessons for Transition Economies from the Israeli Experience.- Balance of Payments, Exchange Rates, and Competitiveness in Hungary.- Current-Account Surplus and Falling Competitiveness in Slovenia.

Central banking, monetary policies, and the implications for transition economies

I: Introduction. Central Banking and Monetary Policies: Major Issues and Implications for Transition Economies M.I. Blejer, M. Skreb. II: Central Bank Independence. Central Bank Independence and Monetary Policy J.A. Frenkel. Central Banking in a Democratic Society: Implications for Transition Countries F.S. Mishkin. Central Bank Independence and the Political Business Cycle: A Critical Re-examination A. Drazen. Political Culture and the Political Economy of Central Bank Independence A. Hillman. III: Defining Central Bank Functions. Central Banking and Economic Development M.J. Fry. IV: Central Banks and Financial Soundness. Central Banks, Asset Bubbles, and Financial Stability G.G. Kaufman. The Conduct of Monetary Policy and Banking Soundness: A Slovenian Episode V. Bole. V: Disinflation and the Role of Nominal Targets. Monetary Policy Strategies for Disinflation: Lessons from Recent Experiences in Transition Economies and Israel G. Bufman, L. Leiderman. VI: Currency Crises and Capital Controls. Speculative Attacks and Capital Mobility C. Wyplosz. Nascent Capital Flows, Learning and Chilean-type Controls M. Selowski, R. Martin. The Role of the Central Banks in the Capital Account Liberalization: Case of Croatia V. Sonje. VII: Currency Boards. Some Reflections about Currency Boards S.H. Hanke. The Central Bank of Bosnia and Herzegovina: Its History and its Issues W. Coats. VIII: EMU and Transition Economies. The International Impact of the Euroland and its Implications for Transition Countries R.A. Mundell. Monetary and Exchange Rate Policy of Transition Economies of Central and Eastern Europe after the Launch of EMU P.A. Masson.

Central Banking and Monetary Policy

The polemic about the proper role of monetary policies and the appropriate functions of central banks, which is not a new debate by any means, has received renewed and vigorous stimulus from a number of current events. In Europe, the once Utopian project of creating a supranational central bank has become a reality: the European Central Bank was launched in mid-1998, and the introduction of the European single currency, the euro, is on schedule. In the United States and in other industrial as well as emerging markets, the debate continues about the location and the attributes of the supervisory authority, and its relations with the monetary authorities. Professional interest has also been centered again on the issue of the proper targeting for monetary policy and the matter of central-bank independence.

Transition and the Open Economy: An Overview

The papers collected in this book2 focus on the external-sector developments and on the process of external liberalization in transition economies, concentrating on issues related to balance-of-payments conditions, exchange-rate policies and regimes, international competitiveness, international financial flows, foreign trade, and other aspects related to the integration of the postsocialist countries into the world economy.