publisher, as the criterion for advancement in the discipline, in practice nowadays papers are invariably read and cited as working papers issued for comment, not as the published work, which typically appears with a considerable lag, if at all. the internet has fundamentally changed how we work ; the collapse of the accepted theories of economic behaviour will fundamentally alter what we work on, in ways that we have only just begun to discern. in my recent address to the bes, i spoke of my growing disillusion with the direction in which economic theory and practice have gone in the last three decades or more, with an orthodoxy, which seemed bent on rushing down a path to irrelevance. thankfully, within the last decade there have been signs of intelligent life in the economics profession, with the emergence of the online journal real world economics, the burgeoning of research on happiness, and the hypothesis that the economy evolves according to universal laws of evolution – laws which are also seen in operation in biology. the challenge for us in the caribbean is to find ways to use these new ideas to guide the design of our research. we have made a start in this direction, with a project on price formation about which i will say a few words later. a second challenge relating to the content of our work is to design projects which can provide answers to the questions policy makers need to address. too much of the analysis we do is of no practical use for decision making. if the exchange rate in carjackistan depreciates, we start trying to estimate demand and supply for foreign exchange, when we know full well the reason for the depreciation is capital flight, because people no longer trust the carjack government. we do a review of the economy of outer slobbovia, a country to which tourists are flocking in droves, and find that prices are rising fast because of the excess demand for hotels and services. we calculate the real effective exchange rate, which is appreciating, and conclude that outer slobbovia is not competitive, no matter that it is stealing market share from all its competitors. this kind of misperception problem is related to the previously mentioned mistaken paradigm. because our framework for thinking about the problem is wrong, we ask the wrong questions, set up the wrong thought experiment, assemble irrelevant data, and come to meaningless conclusions. all, however, is not lost. we have already begun work that may herald a paradigm shift. last friday,

of the market share ; turning to bank of uganda, i wish to re - affirm that as a monetary policy and regulatory authority, the mission of “ maintaining price stability and a sound financial system ” remains paramount. on the monetary front, the recent unfolding inflationary pressures have been proactively responded to using a package of instruments, which include ; i ) pursuing a tight monetary policy stance to regulate money supply ; ii ) tactical interventions into the foreign exchange market to manage and minimize sudden fluctuations in the exchange rate ; on the regulatory front, the following have been applied to ensure soundness and stability of the financial sector : i ) conducting regular on - site examinations and off - site surveillance of supervised financial institutions in order to initiate prompt corrective actions as warranted ; ii ) enhancing risk management framework in all supervised financial institutions ; iii ) implementation of risk - based supervision to foster timely identification, measurement, monitoring and controls of risks inherent in the financial sector ; iv ) periodic reviews of the legal and regulatory framework to ensure update with current developments in the financial sector ; v ) aligning the regulatory framework with international standards especially after the recent global financial crisis ; vi ) to facilitate innovation through amendment of the legal and regulatory framework to permit the following : i ) implement mobile money banking ; ii ) bancassurance ; iii ) islamic banking & finance products. rolling out guidelines for financial literacy and consumer protection. bis central bankers ’ speeches