Archived Series > World Economic and Financial Surveys
Abstract
This study surveys recent trends in private market financing for developing countries. In addition to examining developments in flows to developing countries through banking and securites markets, it analyzes the institutional and regulatory framework for developing country finance, institutional investor behavior and pricing of developing country stocks, management of public sector debt and implications of private external borrowing for macroeconomic policy management, and progress in commercial bank debt restructuring in low-income countries
Abstract
This paper describes the functioning of labor markets and to eliminate other structural obstacles to noninflationary growth. The decline in the price level in the home country will involve a rise in the real money supply and, if output is sluggish, this will result in an excess supply of money. This, in turn, will lead to a drop in the domestic interest rate and, given foreign interest rates, to a temporary depreciation of the exchange rate. Structural measures could also affect investment and the current account by raising the rate of return on capital in the home country. If capital is internationally mobile, a higher rate of return on capital would result in a rise in investment and a temporary deterioration in the home country’s current account, which will be financed by an inflow of foreign capital. The quantitative impact of financial market deregulation on the economy is rather uncertain.