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The political economy of central bank’s quasi-fiscal operations implemented for 2012-2016 in Mongolia

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  • Doojav, Gan-Ochir

Abstract

This paper reviews issues associated with quasi-fiscal operations of the Bank of Mongolia (BOM) implemented during the period 2012-2016 in context of political economy. Under the quasi-fiscal operations, the BOM injected about MNT 7 trillion (which is equivalent to 40 percent of GDP) into the economy over the period 2012-2016. The politically driven quasi-fiscal operations to buffer the economy from external shocks supported growth for a while, but at the cost of increasing economic vulnerabilities. Several lessons are learned from the quasi-fiscal operations. The case study of Mongolia supports the view that politics leads to the economic fluctuations not only through fiscal policy, but also through monetary policy in developing countries.

Suggested Citation

  • Doojav, Gan-Ochir, 2018. "The political economy of central bank’s quasi-fiscal operations implemented for 2012-2016 in Mongolia," MPRA Paper 109850, University Library of Munich, Germany, revised May 2018.
    • Handle: RePEc:pra:mprapa:109850
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Central bank independence; Political pressure; Quasi-fiscal operations; Monetary policy; Mongolia;
    All these keywords.

    JEL classification:

    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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