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The paper argues that the reason real world fixed exchange rate regimes usually have finite bands instead of completely fixed exchange rates between realignments is that exchange rate bands, counter to the textbook result, give central banks some monetary independence, even with free...
Persistent link: https://www.econbiz.de/10012763458
Objective: The objective of the article is to determine which exchange rate regime provides higher bilateral trade … those that might affect the value of bilateral trade and those that are differently affected by fixed exchange rate regime … and currency union. These variables are trade openness, trading partner trade importance, similarities of government debt …
Persistent link: https://www.econbiz.de/10012520004
The paper argues that the reason real world fixed exchange rate regimes usually have finite bands instead of completely fixed exchange rates between realignments is that exchange rate bands, counter to the textbook result, give central banks some monetary independence, even with free...
Persistent link: https://www.econbiz.de/10012474758
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Evidence suggests there is a strong tendency among states to choose fixed exchange rates. Yet he interpretation of fixed exchange rates as a monetary policy rule remains unconvincing. Adopting an endogenous policy perspective, this paper argues that political-support maximizing governments...
Persistent link: https://www.econbiz.de/10009681117