The empirical distinction between de facto and de jure exchange rate regimes raises a number of interesting questions. Which factors may induce a de facto peg? Why do countries enforce a peg but do not announce it? Why do countries "break their promises"? We show that a stable socio-political environment and an efficient political decision-making process are a necessary prerequisite for choosing a peg and sticking to it, challenging the view that sees the exchange rate as a commitment device. Policymakers seem rather concerned with regime sustainability in the face of adverse economic and socio-political fundamentals

Carmignani, F., Colombo, E., Tirelli, P. (2008). Exploring different views on exchange rate regime choice. JOURNAL OF INTERNATIONAL MONEY AND FINANCE, 27(7), 1177-1197 [10.1016/j.jimonfin.2008.06.004].

Exploring different views on exchange rate regime choice

COLOMBO, EMILIO;TIRELLI, PATRIZIO
2008

Abstract

The empirical distinction between de facto and de jure exchange rate regimes raises a number of interesting questions. Which factors may induce a de facto peg? Why do countries enforce a peg but do not announce it? Why do countries "break their promises"? We show that a stable socio-political environment and an efficient political decision-making process are a necessary prerequisite for choosing a peg and sticking to it, challenging the view that sees the exchange rate as a commitment device. Policymakers seem rather concerned with regime sustainability in the face of adverse economic and socio-political fundamentals
Articolo in rivista - Articolo scientifico
Exchange rate regimes, political variables
English
1177
1197
21
Carmignani, F., Colombo, E., Tirelli, P. (2008). Exploring different views on exchange rate regime choice. JOURNAL OF INTERNATIONAL MONEY AND FINANCE, 27(7), 1177-1197 [10.1016/j.jimonfin.2008.06.004].
Carmignani, F; Colombo, E; Tirelli, P
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10281/4506
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