Monetary policy with a banking oligopoly: The government as the final issuer and the enormous public debt in Mexico

Abstract

THIS ARTICLE ANALYZES THE NEGATIVE EFFECTS OF THE LIBERALIZATION OF INTEREST RATES IN EMERGING ECONOMIES, WITH FINANCIAL SYSTEMS CENTERED ON AN IMPERFECT BANKING MARKET. HIGHLIGHTED IS THE WAY THE DEVELOPMENT OF THE CAPITAL MARKET IS INHIBITED, PLUS THE ROLE OF THE GOVERNMENT AS THE FINAL ISSUER, AND THE IRONIC FISCAL DEPENDENCE ASSUMED BY THE CENTRAL AUTONOMOUS BANK IN ITS MONETARY REGULATION OPERATIONS