Macroeconomics in Emerging Markets - 2nd Edition

The macroeconomic experience of emerging and developing economies has tended to be quite different from that of industrial countries. Compared to industrial countries, emerging and developing economies have tended to be much more unstable, with more severe boom/bust cycles, episodes of high inflation and a variety of financial crises. This textbook describes how the standard macroeconomic models that are used in industrial countries can be modified to help understand this experience and how institutional and policy reforms in emerging and developing economies may affect their future macroeconomic performance. This second edition differs from the first in offering: extensive new material on themes such as fiscal institutions, inflation targeting, emergent market crises, and the Great Recession; numerous application boxes; end-of-chapter questions; references for each chapter; more diagrams, less taxonomy, and a more reader-friendly narrative; and enhanced integration of all parts of the work. Features • Analytical material is developed without calculus, but is rigorous, systematic and clear • The treatment is comprehensive, covering a large number of issues for policymakers and students including the 2008–2010 financial crisis • Contains a multitude of examples and applications to recent macroeconomic experience of emerging/developing countries

Preface Part I. The Macroeconomic Framework: 1. Introduction and overview 2. Concepts and definitions: the macroeconomic accounts 3. Short-run macroeconomics and long-run growth Part II. A Benchmark Macroeconomic Model: 4. The aggregate production function, the labor market, and aggregate supply 5. Aggregate demand and goods market equilibrium 6. Financial markets 7. Short-run macroeconomic equilibrium 8. Medium-run macroeconomic equilibrium Part III. Public Finance and Macroeconomic Performance: 9. The intertemporal budget constraint of the public sector 10. Sovereign risk premia 11. Fiscal institutions 12. Privatization 13. High inflation and inflation stabilization Part IV. Monetary Institutions and Monetary Policy: 14. Monetary institutions 15. Inflation targeting Part V. Exchange Rate Management: 16. Equilibrium real exchange rates 17. The benchmark model with floating exchange rates 18. Exchange rate regimes 19. Managing an officially-determined rate Part VI. The Financial Sector and Macroeconomic Performance: 20. Finance, welfare, and growth 21. Financial repression 22. Financial reform 23. The benchmark model with banks 24. Coping with capital inflows Part VII. Varieties of Emerging-Market Crises: 25. Sovereign debt crises 26. Banking crises 27. Currency crises and crisis interactions 28. Lessons from the emerging market crises of the nineties 29. Lessons from the great recession.