Real exchange rates influence the competitiveness of tradable goods produced in a country, and thus the latter’s external balance. In the short-run, real exchange rates are influenced by real, as well as monetary variables. With a view to maintain their competitiveness in international...

Japanese financial policies during the so called High Growth Period (HGP-roughly 1953-1973) stand at sharp contrast with the presumptions of the financial liberalization literature. Against the Japanese example, McKinnon (1991) and Horiuchi (1984) have argued, based on relatively high interest...