Trade Liberalization, Stabilization, and Growth: Some Noteson the Mexican Experience

While inflation slowed sharply in Mexico during 1988, imports surged. Although the growth of domestic absorption could be attributed to a higher fiscal deficit, deriving from sharply higher domestic interest rates, this paper argues that the recovery of private investment was the main driving force,...

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Bibliographic Details
Corporate Author: International Monetary Fund (Author)
Format: Electronic eBook
Language:English
Published: Washington, D.C International Monetary Fund 1990
Series:IMF Working Papers
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Summary:While inflation slowed sharply in Mexico during 1988, imports surged. Although the growth of domestic absorption could be attributed to a higher fiscal deficit, deriving from sharply higher domestic interest rates, this paper argues that the recovery of private investment was the main driving force, as the private sector saved most of its interest income on public debt. The paper also analyzes some of the costs and benefits associated with trade liberalization. While there is no evidence yet that trade liberalization contributed decisively to price stabilization, it may have played an important role in stimulating exports and investment
Physical Description:1 Online-Ressource (46 p)
ISBN:1451923562
9781451923568

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