McKinnon, Ronald I; Pill, Huw - In: Oxford Review of Economic Policy 15 (1999) 3, pp. 19-38
This paper investigates the role of the exchange-rate regime in a simple Fisherian model of the overborrowing syndrome. Where domestic banks are subject to moral hazard, the choice of exchange-rate regime may have important implications for the macroeconomic stability of the economy. Banks that...