View metadata

dc.titleCrisis Response in Latin America: Is the "Rainy Day" at Hand?
dc.contributor.authorFernández-Arias, Eduardo
dc.contributor.authorMontiel, Peter J.
dc.contributor.orgunitDepartment of Research and Chief Economist
dc.coverageThe Caribbean
dc.coverageCentral America
dc.coverageSouth America
dc.date.available2011-02-07T00:00:00
dc.date.issue2009-06-09T00:00:00
dc.description.abstractThis paper examines the countercyclical policy options available to Latin American countries in the face of the current global economic crisis, concluding that most of the major countries in the region appear to possess the fiscal space (as measured by credible fiscal sustainability and debt headroom) to run prudent countercyclical fiscal deficits. Those countries should undertake a constrained fiscal expansion focused on productive public spending and financed by rainy day fundslarge stocks of foreign exchange reserves that they have accumulated during recent yearsrather than by market borrowing. The recent surge in multilateral financial activity to alleviate market illiquidity, whether intended for reserve or budget support, strengthens the case for this policy prescription: with multilateral support, the appropriate policy response is more expansionary, and its financing is less reliant on market borrowing.
dc.identifier.doihttp://dx.doi.org/10.18235/0010915
dc.identifier.urlhttps://publications.iadb.org/publications/english/document/Crisis-Response-in-Latin-America-Is-the-Rainy-Day-at-Hand.pdf
dc.language.isoen
dc.mediumAdobe PDF
dc.publisherInter-American Development Bank
dc.subjectEconomy
dc.subject.jelcodeE62 - Fiscal Policy
dc.subject.jelcodeE63 - Comparative or Joint Analysis of Fiscal and Monetary Policy • Stabilization • Treasury Policy
dc.subject.jelcodeF34 - International Lending and Debt Problems
dc.subject.keywordsWP-686
dc.typeWorking Papers
idb.identifier.pubnumberWorking Papers
idb.operationRG-K1089
Return to Publication