Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/271819 
Authors: 
Year of Publication: 
2022
Series/Report no.: 
CESifo Working Paper No. 10175
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Should a developing economy, such as India, have a macroeconomic policy framework that is identical to an advanced capitalist country? The answer is a "No", because the developing economies have external constraints, that the more developed countries do not. They also, often, need to achieve a structural transformation by moving labour away from agriculture. These economies are, in addition, faced with possibility of international capital flow reversals. I argue for keeping the real exchange depreciated to have an export-led growth, emulating the East Asian experience. In today's world, given protectionism in the advanced capitalist countries, this strategy is more challenging. Also the capacity of the State to deliver this is open to question.
Subjects: 
inflation targeting
big push
exchange rates
structural transformation
JEL: 
E60
O10
O40
Document Type: 
Working Paper
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