Because monetary policy is constrained in fixed exchange rate regimes, banks should expect fewer money-financed bailouts and therefore manage their risks more carefully when exchange rates are fixed than when they are flexible. It follows that we should observe fewer banking crises in countries...

Since monetary policy is constrained in fixed exchange rate regimes, we should observe fewer banking crises due to moral hazard in countries with credible currency pegs. However, three countries with seemingly credible pegs in the nineteen-eighties and -nineties, namely China, Hong Kong and...

Political instability has been blamed for many poor macroeconomic outcomes, such as high inflation, unemployment, and low growth. The author proposes yet another negative consequence of political instability: political instability and polarization generate inflation uncertainty which causes the...

The paper argues that the factors that determine treatment priority in socialized medicine, namely gravity of complaint and patient “importance†are similar to those that determine whether or not a frail banking system will be bailed out in a fixed exchange rate regime.

Le Sherman Silver Purchase Act de 1890 a causé des craintes d'inflation et une série d'attaques sur les réserves du Trésor Américain. Malgré ces attaques, le dollar s'est maintenu durant cette période. On peut se demander pourquoi. Un argument (Fels (1959)) est que les spéculateurs...