Interest Rate Deregulation: A Brief Survey of the Policy Issues and the Asian Experience
Glower, Carlos J. | July 1994
Abstract
It is generally recognized that controlled interest rates distort resource allocation and diminish the economy's capability to generate financial resources needed to promote further economic growth and development. It also leads to macroeconomic instability as the curtailed potential for generating the required financial funds is usually compensated by the central bank through an increase in its liabilities. With these generalizations in mind, it must be emphasized that the financial reform itself is no panacea to the obstacles hindering further development. Nonetheless, no country has escaped underdevelopment without taking direct and specific actions to reform and to strengthen the intermediary role of the financial sector. Moreover, no industrializing economy would be able to function without a financial sector in which a basic price— such as the interest rate—does not respond in one way or another to market forces. It can also be argued, and data corroborates the fact, that the greater the financial repression and the less responsive is the interest rate to market forces, the greater the need for a country to seek external aid, as domestic savings mobilization is inadequate to maintain a stable and sustained growth path.
Citation
Glower, Carlos J.. 1994. Interest Rate Deregulation: A Brief Survey of the Policy Issues and the Asian Experience. © Asian Development Bank. http://hdl.handle.net/11540/3168. License: CC BY 3.0 IGO.ISSN
0117-5492
Keywords
Economic Development
Economic Infrastructure
Economic Policies
Regional Economic Development
Microfinance Programs
Public Finance
Local Financing
Financial Stability
Financial Sector Regulation
Enterprises
Financial aid
Economies in transition
Local Finance
Local Government
Insurance Companies
Banks
Social Equity
Social responsibility of business
Accounting
Personal budgets
Cost and standard of living
Bank accounts
Credit control
Regulatory reform
Banks and banking
Show allCollapse
Citable URI
http://hdl.handle.net/11540/3168Metadata
Show full item recordUsers also downloaded
-
Annual Report 2014: Operational Data
Asian Development Bank (Asian Development Bank, 2015-01-01)The page has additional information for the ADB Annual Report 2014. In 2014, the Asian Development Bank (ADB) approved $22.93 billion in development assistance, including $13.69 billion financed by ADB’s ordinary capital resources and special funds, and a record $9.24 billion by cofinancing partners. Disbursements totaled $10.01 billion, an increase of $1.47 billion (17%) from 2013, and the first ...The page has additional information for the ADB Annual Report 2014. In 2014, the Asian Development Bank (ADB) approved $22.93 billion in development assistance, including $13.69 billion financed by ADB’s ordinary capital resources and special funds, ... -
Special Evaluation Study: Knowledge Products and Services: Building a Stronger Knowledge Institution (Complete Report)
Asian Development Bank (Asian Development Bank, 2012-11-15)Asia and the Pacific have made striking progress in economic development over the past three decades. At the same time, critical challenges and risks remain. External and internal shocks are frequent, yet unpredictable. In addition to economic shocks, the region is increasingly vulnerable to natural disasters, with escalating damage and significant loss of life as floodplain, coastal, and low-lying ...Asia and the Pacific have made striking progress in economic development over the past three decades. At the same time, critical challenges and risks remain. External and internal shocks are frequent, yet unpredictable. In addition to economic shocks, ... -
Guide on Bid Evaluation
Asian Development Bank (Asian Development Bank, 2010-10-15)This guide is intended to provide guidance to borrowers on bid evaluation procedures and how to prepare a bid evaluation report to be submitted to ADB, in connection with the procurement of contracts financed in whole or in part from proceeds of ADB loans.This guide is intended to provide guidance to borrowers on bid evaluation procedures and how to prepare a bid evaluation report to be submitted to ADB, in connection with the procurement of contracts financed in whole or in part from proceeds of ADB loans.