I’m in a room full of central bankers here and it is probably unnecessary to say this, but, at the end of the day and despite our best efforts, even seemingly seamless plans may fail and our policy instruments may let us down.
Yes, it is tough to map out the behavior of an informal sector that is probably the size of the formal economy; yes, it is difficult to impose fiscal discipline; yes, it is almost impossible to control the international prices of fuels and grains; and yes, our textbooks seem to be clueless when it comes to tackling today’s economic problems.