01541cas a2200241 a 4500 AALejournalIMF003469 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451851342 1018-5941 BD-DhAAL BD-DhAAL Roldos, Jorge. On Credible Disinflation / Jorge Roldos. Washington, D.C. : International Monetary Fund, 1993. 1 online resource (26 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students We study the effects of a credible, gradual exchange rate based disinflation program in a two sector economy. After an initial real exchange rate depreciation, the reductions in the rate of devaluation reduce the monetary wedge generated by a cash in advance constraint, leading to a gradual increase in absorption that yields progressive real exchange rate appreciations and current account deficits. An initial boom in economic activity is not followed by a later contraction, as labor supply expands during the whole length of the program. Mode of access: Internet IMF Working Papers; Working Paper ; No. 1993/090 Full text available on IMF http://elibrary.imf.org/view/journals/001/1993/090/001.1993.issue-090-en.xml IMF e-Library