This paper, originally published in the spring 1983 Quarterly Review, explains why flat-rate deposit insurance gives financial intermediaries an incentive to take on too much risk. It also discusses the purposes of deposit insurance and some ways reforms might serve those purposes. Three...

In this paper, we examine various exchange rate regimes, paying particular attention to what difference the monetary-fiscal policy choices of governments make. The exchange rate may be market-determined or fixed, and if fixed, either cooperatively or by one government alone. Further, capital...