Abstract
In the 1950s and 1960s the world economy exhibited a stable and strong economic growth. Balance of payments disequilibriums were moderate and the adjustment policy tended to lean upon demand management. This likewise held for adjustment programmes supported by the IMF. In the 1970s the economic circumstances worsened. Negative trends in economic growth and inflation in the world economy became apparent, the system of fixed exchange rates proved to be untenable and was ultimately abandoned, while serious exogenous shocks started to affect the world economy. Partly in response to these developments, exchange rate adjustments began to figure in the majority of adjustment programmes supported by the IMF. The stronger emphasis on exchange rate policy is illustrated by the fact that the proportion of these programmes which include exchange rate adjustments rose from 31 per cent in the years 1963—72 up to 71 per cent in 1983 — and even 93 per cent in 1983 when programmes for currency union members are neglected (Johnson etal., 1985, pp.6 and 7).
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Jager, H. (1989). The Exchange Rate in the Adjustment Process of Less Developed Countries — A Multifarious Role. In: Fair, D.E., de Boissieu, C. (eds) The International Adjustment Process. Financial And Monetary Policy Studies, vol 17. Springer, Dordrecht. https://doi.org/10.1007/978-94-009-0871-0_20
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DOI: https://doi.org/10.1007/978-94-009-0871-0_20
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