Relative wages and prices change, as do relative returns on capital. And labour moves within a country to promote an orderly adjustment process. Over time, authorities in many countries have come to understand that they need to make marketbased adjustment mechanisms work.
Their role in promoting market-based adjustments is to implement a coherent framework of macroeconomic policies, supported by a safe and sound financial system. From a central banker's point of view, our best contribution to this effort is to deliver monetary  2  BIS Review 51/2007  policy focused on providing low and stable inflation, supported by a floating exchange rate.