The easing of monetary conditions in the economy aimed at fostering the economic activity and creating more spaces to crediting to the economy, without infringing the long-term perspective of the inflation target. This monetary policy resulted to be a right one. Bank of Albania has been successful in achieving its objective on inflation, easing simultaneously the appreciation pressures on the domestic currency. Notwithstanding the easing monetary policy, Bank of Albania has kept under control the growth rate of monetary aggregates. The weak inflationary pressures from the fiscal policy, the good-management of money supply, as well as Lek appreciation, have provided appropriate conditions for a moderate rise of consumer price over 2004. In general terms, Bank of Albania believes that this favourable situation will continue to prevail even during the current year. It will be supported by the favourable monetary conditions of the economy and by the controlled development of domestic demand. Based on the available information and in absence of shocks, the consumer price rise for year 2005 is expected to be within the two-tofour percent targeted range of the Bank of Albania. Monetary indicators performance To achieve its primary objective, that is maintenance of price stability, Bank of Albania relies on the monetary aggregates control as an intermediate instrument. Expectations on monetary indicators performance are provided in detail in the annual monetary program, which serves to orient the Bank of Albania monetary policy. Based on this strategy, the objective of increasing money supply for 2004 was fixed to be 12.4 percent.

In this edition, to the very illustrious list of previous winners of the Germán Bernácer Prize, we add, with all due merit, Professor Nicholas Bloom, a British economist, who is today Professor in the Economics Department at Stanford University. Professor Bloom graduated in Economics from Cambridge University, obtained his masters at Oxford University and his Ph.D. at University College London. He has been awarded the 2010 Frisch Medal of the Econometric Society, is a Fellow of the American Academy of Arts and Sciences and an associate editor of, among other journals, Econometrica and the Quarterly Journal of Economics and Management Science. He has published many articles on economic and management issues in top journals, including the American Economic Review, Econometrica and the Quarterly Journal of Economics. Professor Bloom’s two main areas of research are macroeconomic uncertainty and firm organization and productivity. In the first area, his main contributions are to show that macroeconomic uncertainty increases substantially in the aftermath of significant shocks. He also shows that during these periods of uncertainty firm’s investment responds less to demand shocks. This set of contributions has promoted research that explores the importance of variations in volatility to explain macroeconomic fluctuations and the decisions of agents in the economy. In the second area, firm organization and productivity, he shows that social capital, represented by trust, increases aggregate productivity by affecting the organization of firms. He also shows the implications of these organization techniques on the implementation of Information and Telecommunication technologies across firms.