|
|
Article: Monetary and fiscal policy in LDCs: limitations and constraints. (less developed countries)
- Article from:
- Economic Review
- Article date:
- November 1, 1993
- Author:
CopyrightCOPYRIGHT 1993 Economic and Industrial Publications. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
|
The LDCs (Less Developed Countries) encounter greater Limitations than Developed countries in using monetary and fiscal policies to achieve macroeconomic goals. The banking system, often limited in its ability to regulate the money supply to influence output and prices in developed countries, is even more ineffective in LDCs. Usually the money market in developing countries is externally dependent, poorly organized, fragmented and cartelized. The following are the major limitations of Monetary Policy in LDCs including Pakistan:-
1. Many of the major Commercial Banks in LDCs are branches of large private banks in developed countries, such as Chase Manhattan or ...