Imf Staff Papers Volume 53 No 2

Noteworthy among the six papers appearing in this latest issue of the IMF's peer-reviewed journal is another installment in the Special Data Section. Anthony Pellechio and John Cady from the IMF's Statistics Department take a close look at differences in IMF data; how and when they could occur; and what the implications of such differences might be for end-users of the IMF's data.

Noteworthy among the six papers appearing in this latest issue of the IMF's peer-reviewed journal is another installment in the Special Data Section. Anthony Pellechio and John Cady from the IMF's Statistics Department take a close look at differences in IMF data; how and when they could occur; and what the implications of such differences might be for end-users of the IMF's data.

This is the final issue for 2006 (Volume 53), and contains another paper in the occasional Special Data Section that seeks to measure financial development in the Middle East and North Africa by utilizing a new database. The issue also contains a comment from Jacques J. Polak on parity reversion in real exchange rates.

From the Foreword to the first issue: “Among the responsibilities of the International Monetary Fund, as set forth in the Articles of Agreement, is the obligation to fact as a center for the collection and exchange of information on monetary and financial problems,’ and thereby to facilitate ‘the preparation of studies designed to assist members in developing policies which further the purposes of the Fund.’ The publications of the Fund are one way in which this responsibility is discharged. “Through the publication of Staff Papers, the Fund is making available some of the work of members of its staff. The Fund believes that these papers will be found helpful by government officials, by professional economists, and by others concerned with monetary and financial problems. Much of what is now presented is quite provisional. On some international monetary problems, final and definitive views are scarcely to be expected in the near future, and several alternative, or even conflicting, approaches may profitably be explored. The views presented in these papers are not, therefore, to be interpreted as necessarily indicating the position of the Executive Board or of the officials of the Fund.”

This first issue for 2006 is anchored by two papers on Russia. The opening paper discusses Russia and the World Trade Organization, and the concluding paper, by John Odling-Smee (former Director of the IMF's European II Department), presents a comprehensive and authoritative history of the IMF's relations with Russia during the 1990s. Other articles in this issue cover rent-seeking behavior, estimations of government net capital stocks, and three papers cover different aspects of exchange rates.

This paper outlines the extent of the IMF with its present policies and practices or with some modification of those policies and practices that is capable of dealing satisfactorily with certain problems of international liquidity. Liquidity that is conditional in any of these senses may be somewhat less prized by the country possessing it than would be an equivalent amount of unconditional liquidity; but the imposition of such conditions may be for the general advantage of the international community, and may make countries having surpluses in their balances of payments readier to provide, or to facilitate the provision of, additional liquidity. An increased supply of the type of liquidity of which the use is subject to policy conditions will have somewhat different results. Although it will probably increase the amount and the financing of external deficits, even this is not certain. The various types of liquidity are to some extent substitutes for each other.

This paper describes the operations of the international monetary system and to evaluate its efficacy to meet existing and foreseeable problems. The attempt is made to put the essential characteristics of the entire monetary system in a realistic perspective and to lay a better basis for studying and evaluating problems importantly affected by the operations of the system. Thus, the present international payments system is a deliberate choice among the means of conducting international financial relations. It is not rigid, and it makes provision for both adapting to enduring changes and meeting sudden and grave financial crises. However, the system has two permanent features—the use of par values and the convertibility of currencies for current transactions; without these features, it would cease to exist. The measures taken will be dealt with in a subsequent article on the management of the convertibility system and the techniques available for its defense.