Socio-Economic Constraints on Jamaica's Stabilization Efforts: The Importance of Supply-Side Programs

Abstract

Recently, there has been considerable interest in alternative stabilization programs in developing countries. This paper examines the possibility of implementing this type of program in a country that traditionally has had considerable difficulty in complying with International Monetary Fund programs. The macro-economic simulations of Jamaica's economy clearly show that successful supply-side policies could have mitigated the adverse income effects of stabilization associated with the standard IMF approach to stabilization.