Monetary Policy and Central Banking in the Middle East and North Africa 1st edition by David Cobham,Ghassan Dibeh 1134023766 9781134023769

1 Introduction

References

Part I Central banking and monetary policy

2 The political economy of central banking in the MENA region with special reference to Lebanon

Introduction

1 Central Bank independence and inflation in MENA

2 The rise of the Banque du Liban

3 The political economy of the BdL

Finance-industry relations

The position of Lebanon in the international economy

Capital-labour relations

Transformation in the political-economic matrix

4 Conclusions

Notes

References

3 The degree of legal central bank independence in MENA countries: International comparisons and macroeconomic implications

Introduction

1 A brief survey of the literature on central bank independence

2 Methodology and brief regional overview

Methodology

A brief regional overview of the Mediterranean region

3 Results

The Mediterranean region

Central bank objectives

Policy form ulation

Political autonomy

Economic autonomy

Accountability

4 The macroeconomic impact of central bank independence

The Mediterranean region

5 Concluding remarks

Notes

References

Appendix 3.1 Scores

Appendix 3.2 Methodology

4 Monetary policy operations of debtor central banks in MENA countries

Introduction

1 Monetary and exchange rate policies by creditor and debtor central banks

The asymmetric nature of the world currency system

Creditor central banks

Debtor central banks

2 Monetary policy operations at debtor central banks in MENA countries

Overview and data

Country analysis

3 Conclusions

Notes

References

5 Central bank independence in a MENA transition economy: The experience of Algeria

Introduction

1 Does central bank independence matter in developing countries?

Definitions and measures of central bank independence

The challenge for developing countries

2 Institutional heritage and the independence of the Bank of Algeria

The socialist legacy: the Bank of Algeria in a planned economy (1962–1990)

Algeria as a MENA country: the Bank of Algeria in a ‘capitalist’ economy (1990–2005)

On the impact of political constraints: the independence of the Bank of Algeria at the time of the ‘events’ (1990–1993)

The dependence of the Bank of Algeria on the IMF: the impact of the adjustment programmes (1994–1998)

A political and economic context favourable to the independence of the Bank of Algeria: 2000/2001–2005

3 The evolution of the de jure and de facto independence of the Bank of Algeria

De jure and de facto independence from 1990 to 2003

Why the Bank of Algeria took the path towards de jure independence

The election of the managers

The conduct of monetary policy

The stability of prices

The budget deficit and monetary policy

From de jure to de facto independence in the 1990s

What has changed with the 2003 ordinance

From de jure to de facto independence in the 2000s

4 Conclusion

Note

References

6 Inflation targeting and financial fragility in Tunisia

Introduction

1 The readiness of the Tunisian monetary and financial system for inflation targeting

The central bank

The soundness of the Tunisian financial system

Monetary and fiscal policies

2 Financial fragility and the effectiveness of inflation targeting: the analytical framework

The model

Simulations

3 Conclusion

Notes

References

Appendix 6.1 Data description and sources

Appendix 6.2 Actual versus fitted variables: base run

Appendix 6.3 Econometric estimation

Part II Monetary policy and exchange rate regimes

7 Alternative exchange rate regimes for MENA countries: Gravity model estimates of the trade effects

Introduction

1 Methodology and data

A formal gravity model

Estimating the gravity model

2 Exchange rate regimes

3 The estimation result

4 Simulation results

5 Conclusions

Notes

References

Data definitions

Appendix 7.1

8 Exchange rate arrangements and price stability in MENA countries

Introduction

1 Literature review

2 Exchange rate regime classification in MENA countries

The IMF exchange rate classification

Exchange rate regimes in MENA countries: evolution and performance

3 Testing methodology

4 Empirical results

5 Conclusion

Notes

References

9 Exchange rate regimes for small countries: An application to the Maghreb countries

Introduction

1 Brief economic background of Algeria, Morocco and Tunisia

2 The model

Markets for goods

Initial equilibrium

Economic policy objectives

Transaction costs

3 Shocks and adjustment

Flexible exchange regime (Flex)

Fixed exchange rate regime of the BW type (Fix1): the large country retains monetary autonomy

Fixed exchange rate regime of EMS type: floating against the large country

Monetary Union between countries 1 and 2 (MU): floating against the large country.

4 Evaluation of exchange rate regimes: a cost-benefit analysis

The adjustment costs component

Monetary shocks

Real shocks

The inflationary bias component

Transactions costs

5 Conclusion

Notes

References

10 Estimating central bank behaviour in emerging markets: The case of Turkey

Introduction

1 The empirical model

Data and estimation

Conclusion

Notes

References

Appendix 10.1

11 A common currency for Middle Eastern and North African countries?: Lessons from the European Monetary Union

Introduction

1 Economic performance in MENA countries: some stylised facts and figures

2 Exchange rate arrangements, trade, and financial stability

3 A new framework for regional monetary integration

Payments between two MENA countries

Payments between a MENA country and a E(M)U country

Payments between a MENA country and a non-E(M)U country

Conclusion