ECON 3580 Lecture Notes - Lecture 22: Crawling Peg, United States Dollar, Aggregate Demand
17 Jul 2018
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In august 1982, mexico announced that it could not repay its debts, mostly to private banks: the u. s. government insisted that the private banks reschedule the debts, and in 1989. Starting in 1987, it reduced government deficits. reduced production in the public sector (including banking) by privatizing industries. reduced barriers to trade: maintained an adjustable fixed exchange rate ( crawling peg ) until 1994 to help curb inflation. 1994, after which the mexican government allowed the value of the peso to fluctuate: starting in 1991, argentina carried out similar reforms: It enacted the convertibility law, which required that each peso be backed with 1. It also defaulted on its debt in december 2001 because of the unwillingness of investors to reinvest when the debt was due: brazil carried out similar reforms in the 1980s and 1990s: It reduced production in the public sector by privatizing industries. It enacted tax reforms to increase tax revenues.
