Economic and Financial Developments in Latin America (Center for the Study of Emerging Markets)

This book evaluates the economic effect of monetary policies and exchange rate arrangements within Latin America. Using theoretical and empirical studies, the text examines pertinent issues in Argentina, Mexico and Brazil, including the role of currency board, inflation targeting and international prudential regulation in banking crisis reduction. This book provides a collection of seven studies on Latin American countries, with a focus on Argentina, Mexico and Brazil. The studies assess the successes as well as the shortcomings of monetary and foreign exchange policies that have been introduced in the three countries. They include an analytical assessment of the role of currency board in Argentina, a model of monetary policy in the case of Mexico and the problems that it might cause for the private sector, an examination of the role of inflation targeting in Mexico and Brazil and systemic risks that it might generate when combined with floating exchange rate regime. The other studies include an assessment of the importance of commitment credibility and state capacity in attracting FDI, an examination of the role of international prudential regulation in reducing banking crisis, a model of bank disappearance for Mexico, and an analysis of the relationship between foreign exchange rate regime and vulnerability of companies foreign activity This Book Provides A Collection Of Seven Studies On Latin American Countries, With A Focus On Argentina, Mexico And Brazil. The Studies Assess The Successes As Well As The Shortcomings Of Monetary And Foreign Exchange Policies That Have Been Introduced In The Three Countries.--jacket. Convertibility Law And Its Role In Argentina's Economy / Sima Motamen-samadian -- International Prudential Regulation And The Prevention Of Banking Crises In Latin America / Alexandre Minda And Stephanie Truquin -- From Finanacial Repression To Financial Regression / Etelberto Ortiz -- Inflation Targeting And Exchange Rate Risk And Emerging Economies Subject To Structural Inflation / Guadalupe Mantey -- Credible Commitments And The Relevance Of State Capacity / Albert A. Gonzalez -- Determinants Of The Disapperance Of Mexican Banks / Clemente Hernandez-rodriguez -- Corporate Foreign Vulnerability, Financial Policies And The Exchange Rate Regime / Jose Luis Rossi, Jr. Edited By Sima Motamen-samadian. Includes Bibliographical References And Index. Cover......Page 1 Contents......Page 6 List of Figures and Tables......Page 7 Preface......Page 10 Acknowledgements......Page 12 Notes on the Contributors......Page 13 1 Introduction......Page 14 2 Convertibility Law and its Role in Argentina’s Economy......Page 19 3 International Prudential Regulation and the Prevention of Banking Crises in Latin America......Page 59 4 From Financial Repression to Financial Regression: The Limits of the ‘Tyrannical Auctioneer’ and Monetary Policy......Page 83 5 Inflation Targeting and Exchange Rate Risk in Emerging Economies Subject to Structural Inflation......Page 112 6 Credible Commitments and the Relevance of State Capacity: Mexico’s Foreign Direct Investment under the NAFTA......Page 142 7 The Determinants of the Disappearance of Mexican Banks......Page 165 8 Corporate Foreign Vulnerability, Financial Policies and the Exchange Rate Regime: Evidence from Brazil......Page 185 I......Page 208 R......Page 209 W......Page 210