This paper analyses the functioning of the European Exchange Rate Mechanism (ERM). To that end, we apply duration models to estimate an augmented target-zone model, explicitly incorporating political and institutional factors into the explanation of European exchange rate policies. The...

This paper surveys recent research in open-economy macroeconomics, using questions raised by European economic and monetary unification to guide the topics discussed. A striking empirical regularity is the tendency for changes in the nominal exchange rate regime systematically to affect the...

A country’s rise to economic dominance tends to be accompanied by its currency becoming a reference point, with other currencies tracking it implicitly or explicitly. For a sample comprising emerging-market economies, we show that in the last three years, the renminbi (RMB) has increasingly...

The paper examines potential conflicts between rapid EU integration of economies in transition (EiTs) and their pursuing catch-up by focusing on exchange-rate policies. After justifying the proposed inquiry, official pronouncements on ER policies that EUcandidates are expected to pursue in the...

The paper examines potential conflicts between rapid EU integration of economies in transition (EiTs) and their pursuing catch-up by focusing on exchange-rate policies. After justifying the proposed inquiry, official pronouncements on ER policies that EUcandidates are expected to pursue in the...

he financial market crises in Japan and the United States due to bubbles and the exchange rate, banking and sometimes foreign debt crises that affected in past years South-East Asia, Russia, Brazil, Argentina, and Turkey made for a brief evaluation of the adequacy of national and international...

This paper examines the exchange rate regimes of East Asian countries since the initial shift by China to a controlled appreciation in July 2005, testing econometrically the weights of key currencies in the implicit baskets that appear to be targeted by East Asian monetary authorities. It finds,...

This paper examines jointly the empirical relevance of the mean-reversion and the PPP hypotheses in the exchange rate dynamics under the EMS. Given the non-stationarity and the non-linearities characterizing the foreign exchange rate dynamics, this question is studied using a MS-ECM model: it...

We extend existing estimators for duration data that suffer from non-random sample selection to allow for time-varying covariates. Rather than a continuous-time duration model, we propose a discrete-time alternative that models the effects of sample selection at the time of selection across all...

We investigate in this paper the skirmishes that the US dollar and the euro had from 2007 to 2011 and, in particular, the two distinct sharp falls that the single currency had in 2008 and 2010. We basically consider how impulses coming from domestic money markets impact on the USD/EUR exchange...