Black markets for foreign exchange, real exchange rates, and inflation
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Black markets for foreign exchange, real exchange rates, and inflation overnight versus gradual reform in Sub-Saharan Africa by Brian Pinto

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Published by International Bank for Reconstruction and Development in Washington, DC .
Written in English

Subjects:

Places:

  • Africa, Sub-Saharan.

Subjects:

  • Black market in foreign exchange -- Africa, Sub-Saharan.,
  • Inflation (Finance) -- Africa, Sub-Saharan.,
  • Foreign exchange -- Africa, Sub-Saharan.

Book details:

Edition Notes

StatementBrian Pinto.
SeriesPolicy, planning, and research working papers ;, WPS 84., Financial operations, Policy, planning, and research working papers ;, WPS 84., Policy, planning, and research working papers.
Classifications
LC ClassificationsHG3982 .P563 1988
The Physical Object
Pagination30 p., [2] p. of plates :
Number of Pages30
ID Numbers
Open LibraryOL2134524M
LC Control Number88200292

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The black market foreign exchange premium is a tax on exports, creating a conflict between the financing of government spending and the allocative goal of stimulating exports. The premium is solved for in a model that includes private portfolio choice, dual exchange markets and Cited by: Pinto, Brian, "Black markets for foreign exchange, real exchange rates, and inflation: overnight versus gradual reform in sub-Saharan Africa," Policy Research Working Paper Ser The World Bank. Handle: RePEc:wbk:wbrwps Black markets for foreign exchange, real exchange rates, and inflation: overnight versus gradual reform in sub-Saharan Africa The steady state and dynamic implications for inflation of floats as a vehicle for unifying official and black market rates are then analyzed. Inflation could rise substantially in the new steady state as the lost Author: Brian Pinto. Key Words: Black Market Exchange Rates, Economic Growth, Reserve Requirements, Inflationary Finance. JUNE T o be p resented at the Fourth Conference on Dynamics, Economic Growth, and.

higher inflation and black market rates in the future, which in turn would be driven by an expectation of a decline (or further decline) in the provision of foreign exchange for imports. Capital flight could nonetheless improve economic welfare if it smooths consumption over. variables that relate to the black market premium for foreign exchange, this study is based on monthly time ser ies da ta covering January to December   1. Foreign exchange restrictions spawn currency black markets. Black markets come about when controls on foreign exchange restrict access to the official markets, forcing people to resort to unofficial channels. This typically gives rise to a premium over the official rate known as the black market premium.   Also, markets anticipate future inflation. If they see a policy likely to cause inflation (e.g. cutting interest rates) then they will tend to sell that currency causing it to fall in anticipation of the inflation. How the exchange rate affects inflation. If there is a depreciation in the exchange rate, it is likely to cause inflation to increase.

run demand for real money, M2 in Iran includes real income, the inflation rate, and the black market exchange rate (not the official exchange rate). The research work done by Bahmani-Oskooee () attracted a considerable amount of attention from researchers and, to the best of my. Downloadable! This paper looks into the changes of the black market premium for foreign exchange in Zimbabwe. Generally, the black market for foreign exchange arises as a direct consequence of the adoption of exchange rate controls in many developing economies facing substantial macroeconomic imbalances. Despite its negative impact on Zimbabwe’s economy, this market has not, so far.   This study examines theoretically as well as empirically the behavior of a small open economy, first, under a dual official-black market exchange rate regime, and then, under the process of unification that has as its ultimate objective to absorb and legalize the black market for foreign exchange, eliminating the inefficiencies and market fragmentation associated with quasi-illegal . 2. Overview of the exchange markets in China Active black markets for foreign currency emerge primarily because of direct and indirect official intervention in the foreign exchange market. In China, black market transactions have been a keystone of economic activity and monetary life for over half a .