The Reserve Bank of India has promoted research right from the early years of its existence. Excellent research papers have been prepared by some of the outstanding economists of the Bank. Barring exceptions, the invaluable research embodied in these papers has not been ‘widely’ disseminated.

Former Executive Director, Dr. A. Vasudevan has utilized his lifetime of experience at the central bank to painstakingly edit the present collection of research papers (organised under four sections) with a comprehensive introduction.

According to Dr. Vasudevan “The objective of the volume is not to include articles in a large number of areas but to include only those that focus on money, monetary policy and banking issues — areas in which the Reserve Bank’s expertise is widely recognized.”

The 20 chosen research papers included in the volume are contributed by :

D. Ajit, R.D. Bangar, Anupam Basu, Indranil Bhattacharya, B.K. Bhoi, Goutam Chatterjee, Abhiman Das, Narendra Jadhav, Himanshu Joshi, Renu Kohli, 
K.A. Menon, M.S. Mohanty, Ashok Nag, N. Nagarajan, Michael Debabrata Patra, Sitikantha Pattanaik, C. Rangarajan, D.C. Rao, Deba Prasad Rath, 
Mridul Saggar, Y.S.R. Sarma (late), Indranil Sengupta, Anoop Singh, A. Vasudevan, T.R. Venkatachalam, and Ghanshyam Upadhyay.

Dr. C. Rangarajan’s foreword to this volume adequately highlights its unique importance — a fact also echoed in the comments of two other distinguished experts, namely Professor R. Radhakrishna and Professor D.M. Nachane.

This collection of research papers gives the flavour of the research work that is getting done in the Reserve Bank of India. They reveal both maturity and technical excellence.

I congratulate Dr. Vasudevan in undertaking this effort and choosing a spectrum of articles that is truly representative of the research in the Reserve Bank of India.
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Dr. C. Rangarajan
Chairman, Twelfth Finance Commission
Former Governor, Reserve Bank of India
Dr. Vasudevan exemplifies the highest traditions of that rare but felicitous blend of impeccable academic scholarship and intimate experience of high-level policy-making. This volume, edited by him, largely reflects research studies done by his younger colleagues at the Reserve Bank of India. Most of the studies have drawn inspiration either from his direct participation or from his own writings. The study of several of the areas discussed in the book (such as the monetary transmission mechanism and money supply analysis) was pioneered by him in the Indian context during his long career at the Reserve Bank. It is a safe prognosis that the volume should prove rewarding both to academics researching on monetary economics as also to all those concerned with the fine art of monetary policy

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Professor D.M. Nachane
Former Director, Department of Economics, University of Mumbai
This commendable book edited by Dr. A. Vasudevan, a leading monetary economist, is based on selected papers prepared by the monetary economists of the Reserve Bank of India during the last two decades for its in-house journal. The topics range from conceptual issues to macro monetary models and methodologies from traditional econometric techniques to recent advances in co-integration. It provides a useful insight into how monetary policy is responding to the problems of inflation and balance of payments and carefully assesses policy effects. A few papers present evidence bearing on the role of money supply in the inflationary process and make a case for money based monetary policy against the credit view, which dominated the monetary policy prior to reforms. The small sized macro econometric model based on Polak's absorption approach estimated for exploring the interaction between fiscal deficit and external balance will be handy for class room teaching.

The introductory essay and introduction to sections by the editor provide a useful historical account of the issues, debates and policy responses, besides contextualizing the papers included in the book. The approach is both analytical and rigorous. It is a required reading for any one interested in policy design.

In my view, in terms of its coverage and range of insight, this book will be a most valuable source for students and economists.

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Professor R. Radhakrishna
Director, Indira Gandhi Institute of Development Research (IGIDR), Mumbai

Dr. A. Vasudevan, currently Honorary Advisor in the Reserve Bank of India, was Executive Director of the Reserve Bank between May 1996 and end-August 2000. As the Executive Director, he was in-charge of research, statistics, monetary policy and information technology departments. He has had vast international experience — Advisor to Executive Director for India at the International Monetary Fund (IMF) between 1984 and 1989; Member of the Indian Delegations to semi-annual IMF/ World Bank and G-24 meetings between 1984 and 1989 and again between 1993 and 2000; represented India at the UNDP Conference on financing of sustainable development at Santiago, Chile; Central Bank Deputy at the Group of Two Deputies’ meetings; and Member of the Task Force on Implementation of Standards and the Follow-up Group on the Implementation of Standards, appointed by the Financial Stability Forum.

Among the several Committees on which he served, the important ones were: Expert Group on Saving and Capital Formation in India, Government of India, 1996 (Member), the Working Group on Money Supply, Reserve Bank, 1998 (Vice-Chairman), and the Committee on Technology Upgradation in Banking Sector, Reserve Bank of India, 1999 (Chairman).

Apart from the present volume (edited by him), Dr. Vasudevan has recently authored Central Banking for Emerging Market Economies (Academic Foundation, 2003). Described as a “path-breaking work” of “encyclopaedic proportions”, within a short time-span this publication received extraordinary praise in several reviews across leading newspapers and journals. Having authored/edited a few other books earlier, Dr. Vasudevan has numerous scholarly writings of his own in various professional journals, both Indian and foreign. He also taught M.A. students at the University of Bombay (1966-69) on the theories of money and economic development and central banking.

Currently Dr. Vasudevan is engaged in writing the history of Reserve Bank of India — a task he has been entrusted with by a committee of the central bank, chaired by Dr. C. Rangarajan.