Trilemmas and tradeoffs: living with financial globalization
This paper evaluates the capacity of emerging market economies (EMEs) to moderate the domestic impact of global financial and monetary forces through their own monetary policies. I present the case that those EMEs able to exploit a flexible exchange rate are far better positioned than those that dev...
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| Autor principal: | |
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| Formato: | Artículo |
| Lenguaje: | eng |
| Publicado: |
Banco Central de Chile
2019
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| Acceso en línea: | https://hdl.handle.net/20.500.12580/3815 |
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| Sumario: | This paper evaluates the capacity of emerging market economies (EMEs) to moderate the domestic impact of global financial and monetary forces through their own monetary policies. I present the case that those EMEs able to exploit a flexible exchange rate are far better positioned than those that devote monetary policy to fixing the rate—a reflection of the classical monetary policy trilemma. Indeed this ability was critically important in EMEs’ widely successful response to the Global Financial Crisis (GFC) of 2007-2009. |
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