The Impossible trinity: Where does India stand?

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dc.contributor.author Sengupta, Rajeswari
dc.date.accessioned 2015-12-01T12:08:16Z
dc.date.available 2015-12-01T12:08:16Z
dc.date.issued 2015-03
dc.identifier.uri http://hdl.handle.net/2275/353
dc.description.abstract The Global Financial Crisis of 2008 and the heightened macroeconomic and financial volatility that followed the crisis raised important questions about the current international financial architecture as well as about individual countries' external macroeconomic policies. Policy- makers dealing with the global crisis have been confronted with the 'impossible trinity' or the 'Trilemma', a potent paradigm of open economy macroeconomics asserting that a country may not target the exchange rate, conduct an independent monetary policy and have full financial integration, all at the same time. This issue is highly pertinent for India. A number of challenges have emanated from India's greater integration with the global financial markets during the last two decades, one of which includes managing the policy trade offs under the Trilemma. In this chapter, I present a comprehensive overview of a few empirical studies that have explored the issue of Trilemma in the Indian context. Based on these studies I attempt to analyze how have Indian policy makers dealt with the various trade-offs while managing the Trilemma over the last two decades. en_US
dc.language.iso en en_US
dc.relation.ispartofseries WP;WP-2015-005
dc.subject Impossible Trinity en_US
dc.subject Financial Integration en_US
dc.subject Currency Stabilization en_US
dc.subject International Reserves en_US
dc.subject Sterilized Intervention en_US
dc.title The Impossible trinity: Where does India stand? en_US
dc.type Working Paper en_US

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