01766cas a2200241 a 4500 AALejournalIMF016878 230101c9999 xx r poo 0 0eng d 5.00 USD 9781498313551 1934-7685 BD-DhAAL BD-DhAAL International Monetary Fund. European Dept. Iceland : Selected Issues. Washington, D.C. : International Monetary Fund, 2016. 1 online resource (23 pages) IMF Staff Country Reports <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 This paper examines Iceland's expenditure policy, especially five expenditure pressure points, as well as capital flows and monetary policy effectiveness in small open economies. The postcrisis fiscal adjustment demanded painful choices, with spending on healthcare, education, and investment suffering cuts in real terms. While expenditures in these areas have rebounded more recently, there is a room for further decompression. Using quarterly panel data for 18 advanced and emerging small open economies during 2002-15, it finds that monetary policy is focused on inflation developments, but also that domestic interest rates affect capital flows, raising concerns about a reinforcing loop between monetary policy and capital flows. Mode of access: Internet IMF Staff Country Reports; Country Report ; No. 2016/180 Full text available on IMF http://elibrary.imf.org/view/journals/002/2016/180/002.2016.issue-180-en.xml IMF e-Library