9,497 research outputs found

    Managing Agricultural Price Risk in Developing Countries

    Get PDF
    We survey the experience of risk management in developing country agricultural supply chains. We focus on exposure, instruments, impediments to access and developing country futures markets. We draw on lessons from experience over the past two decades.Commodities, Risk Management, Developing Countries

    Understanding Economic Change

    Get PDF

    A prototype model of speculative dynamics with position-based trading

    Get PDF
    To avoid the indeterminate and generally unbounded positions of the agents in financial market models with order-based trading, the paper considers the alternative of position-based strategies. To this end it extracts a prototype model from the literature, with fundamentalists, chartists, and a risk-averse market maker. The deterministic formulation of the model leads to a neutral delay differential equation of the price, whose mathematical analysis is non-standard. The stability conditions are nevertheless quite analogous to the order-based Beja–Goldman model. The effects of parameter variations are also studied in a stochastic setting, where special emphasis is put on the misalignment between price and the time-varying fundamental value, and on the differential profits of fundamentalists and chartists

    Informational spillovers in the pre-1914 London Sovereign Debt Market

    Get PDF
    We document a novel type of international financial contagion whose driving force is shared financial intermediation. In the London peripheral sovereign debt market during pre-1914 period financial intermediation played a major informational role to investors, most likely because of the absence of international monitoring agencies and the substantial agency costs. Using two events of financial distress – the Brazilian Funding Loan of 1898 and the Greek Funding Loan of 1893 – as quasi-natural experiments, we document that, following the crises, the bond prices of countries with no meaningful economic links to the distressed countries, but shared the same financial intermediary, suffered a reduction relative to the rest of the market. This result is true for the mean, median and the whole distribution of bond prices, and robust to an extensive sensitivity analysis. We interpret this as evidence that the identity of the financial intermediary was informative, i.e, investors extracted information about the soundness of a debtor based on the performance of her financial intermediary. This spillover, informational in essence, arises as the flip-side of the relational lending coin: contagion arises for the same reason why relational finance (in this case, underwriting) helps alleviate informational and incentive problems,

    A Framework for Exchange Rate Policy in Korea

    Get PDF
    The monetary policy and exchange rate regime that served Korea well for many years ended in crisis in 1997. The regime that collapsed was characterized by a tightly managed nominal exchange rate and domestic financial markets that were controlled by the government and largely closed to international transactions. The practical question for authorities over the next few years is what monetary and exchange rate regime will best promote the objectives of maintaining economic and financial stability as financial markets are liberalized. Our basic proposal is that the powerful policy tool, interest rate policy, be used to attain a "flexible" inflation target. Flexibility in this context means that the authorities also care about short-run fluctuations in domestic output and employment. The less powerful policy tool, sterilized intervention in the foreign exchange market, would be used to limit day to day changes in exchange rates. We argue that the government should continue to be an important participant in the foreign exchange market but not attempt to establish a level for the exchange rate. Our proposal will involve intervention that is triggered by exchange rate volatility but constrained by an announced target for the government's overall net foreign asset position. The objective of this regime is to allow the government to participate in the foreign exchange market in a way that contributes to economic stability and promotes the development of the private sector's participation in foreign exchange and financial markets.monetary policy, exchange rate regime, Korea, government

    The EMU's exchange rate policy

    Get PDF
    Contents: 1. Forum Economique Franco-Allemand - Deutsch-Französisches Wirtschaftspolitisches Forum...1 -- 2. Opening Address, Klaus BĂŒnger...2 -- 3. EMU and Transatlantic Exchange-Rate Stability - AgnĂšs BĂ©nassy-QuĂ©rĂ© and BenoĂźt Mojon...5 -- 4. What Exchange Rate Policy in EMU? - Manfred J.M. Neumann...30 -- 5. Summary of the Discussion...39 --
    • 

    corecore