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Fear of Appreciation and Current Account Adjustment

Bergin, Paul R.; Kim, Kyunghun; Pyun, Ju Hyun - National Bureau of Economic Research - 2022

This paper finds that limited exchange rate flexibility in the form of "fear of appreciation" significantly slows adjustment of current account imbalances, providing novel support for Friedman's conjecture regarding exchange-rate flexibility. We present a new stylized fact: floaters have faster...

Persistent link: https://www.econbiz.de/10013334498

The External Impact of China's Exchange Rate Policy : Evidence from Firm Level Data

Eichengreen, Barry - 2011

China's exchange rate policy in 2005 and 2010 and data on 6,050 firms in 44 countries. Renminbi appreciation has a positive … effect on firms exporting to China but little positive or even a negative impact on those providing inputs for China …'s processing exports. Stock prices rise for firms competing with China in their home market while falling for firms importing …

Persistent link: https://www.econbiz.de/10012461061

Limiting Currency Volatility to Stimulate Goods Market Integration : A Price Based Approach

Parsley, David C. - 2001

This paper empirically studies the effect of instrumental and institutional stabilization of the exchange rate on the integration of goods markets. An instrumental stabilization of the exchange rate is accomplished through intervention in the foreign exchange market, or by monetary policies. An...

Persistent link: https://www.econbiz.de/10012470250

G3 Exchange Rate Relationships : A Recap of the Record and a Review of Proposals for Change

Clarida, Richard H. - 1999

This paper is a recap of G3 exchange rate relationships since the collapse of Bretton Woods and an analysis of recent proposals for changing the way the G3 countries currently conduct exchange rate policy. We seek to understand these proposals in the context of the status quo monetary policies...

Persistent link: https://www.econbiz.de/10012471348

Exchange Rates and Financial Fragility

Eichengreen, Barry - 1999

In this paper we analyze three views of the relationship between the exchange rate and financial fragility: (1) the moral hazard hypothesis, according to which pegged exchange rates offer implicit insurance against exchange risk and thereby encourage reckless borrowing and lending; (2) the...

Persistent link: https://www.econbiz.de/10012471363

An Options-Based Analysis of Emerging Market Exchange Rate Expectations : Brazil's Real Plan, 1994-1997

Campa, Jose M. - 1999

This paper uses currency option data from the BMF, the Commodities and Futures exchange in Sao Paulo, Brazil, to investigate market expectations on the Brazilian Real-U.S. dollar exchange rate from October 1994 through July 1997. Using options data, we derive implied probability density...

Persistent link: https://www.econbiz.de/10012471878

Nominal Anchor Exchange Rate Policies as a Domestic Distortion

Krueger, Anne O. - 1997

This paper analyzes a nominal anchor exchange rate policy as a domestic distortion, in the tradition of international trade theory. It is shown that, in addition to the problems of sustainability and exit pinpointed in the exchange rate literature, a nominal anchor exchange rate policy, while in...

Persistent link: https://www.econbiz.de/10012472853

When Are Fixed Exchange Rates Really Fixed?

Velasco, Andres - 1996

This paper analyzes the sustainability of fixed exchange rates by extending the Barro-Gordon framework to a fully dynamic context in which the level of a state variable (in this case debt) determines the payoffs available to the government at each point in time. The model yields the following...

Persistent link: https://www.econbiz.de/10012472986

Speculative Attacks : Fundamentals and Self-Fulfilling Prophecies

Flood, Robert P. - 1996

We develop a modified understand better the 1994 Mexican peso crisis as well as aspects of the European currency crises in 1992-93. We introduce the assumption that the speculative attack is sterilized by the domestic monetary authority, we incorporate a stochastic risk premium, and we allow for...

Persistent link: https://www.econbiz.de/10012473044

The Determinants of the Choice between Fixed and Flexible Exchange-Rate Regimes

Edwards, Sebastian - 1996

In recent years, analysts and policy makers alike have been evaluating the nexus between exchange rates and macroeconomic stability. Among the most important questions is why have some countries adopted rigid, including fixed, exchange-rate paper addresses this question from a political economy...

Persistent link: https://www.econbiz.de/10012473078

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