February 2020 Extension: Latin American countries

The classification has now been extended to (southern, central and northern) Latin America, covering 20 countries of which six were previously included as emerging economies: Argentina, Brazil, Chile, Mexico, Peru and Venezuela. At a later date a number of Caribbean countries will also be covered, so this will become a full Latin American and Caribbean grouping. A few small changes have been made to the text, but not the classification, for Venezuela.

July 2019 Extension: the Middle East and North Africa

The classification has now been extended to the MENA region, defined here to cover Iran, Turkey and 17 Arab countries. The list includes four that were previously included as emerging economies: Egypt, Jordan, Morocco and Turkey. One small classification change has been made for Jordan (1996-2000, identified previously as full exchange rate targeting but now as loose exchange rate targeting), there is a corresponding change to the country details text for Jordan, and there is a small change to the country details text for Turkey, 1989-2002. These changes have been applied under the emerging economies as well.

February 2019 Updating and Revision

The classification has now been extended to 2017 (so it now covers 44 years in total). In addition, one substantive change has been made: the US 1990-95 is now classified as ‘loosely structured discretion’ LSD instead of ‘well structured discretion’ WSD, which is more consistent with other episodes of LSD. The old classification can be found here, and the old individual country details here.

November 2018 Revision

The nomenclature of the second aggregation of monetary policy frameworks has been changed from ‘stages of development’ – with subgroups ‘basic’, ‘intermediate 1’, ‘intermediate 2’ and ‘developed’ – to ‘degree of monetary control’, with subgroups ‘rudimentary’, ‘intermediate’, ‘substantial’ and ‘intensive’. The change reflects both a view that ‘developed’ begged too many questions and the view that the previous perspective was inappropriately monotonic. The allocation of the various frameworks among these four aggregates has not been changed.

A comprehensive classification of monetary policy frameworks

This site is host to a new dataset with a comprehensive classification of monetary policy frameworks, prepared by David Cobham, professor of economics at Heriot-Watt University, Edinburgh, Scotland, UK (with many thanks to Alexander Cobham for his help in setting up the website).

The current dataset covers 60 advanced and emerging economies. Over time the dataset will be expanded to cover some 100 developing economies, starting with those from the Middle East and North Africa and those in Latin America.

This site provides an overview of the approach, including the original working paper; the results for individual countries; and the classification system used.

Researchers are encouraged to use the dataset in any relevant work, and are requested to keep us informed so that we can post links and commentary.