To Peg or Not to Peg: A Template for Assessing the Nobler

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Price:  $15.00

Author/Editor: Aasim M. Husain
Release Date: © February, 2006
ISBN : 978-1-45186-314-7
Stock #: WPIEA2006054
English
Stock Status: Available

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Description

This paper proposes a template for assessing whether or not a country's economic and financial characteristics make it an appropriate candidate for a pegged exchange rate regime. The template employs quantifiable measures of attributes-trade orientation, financial integration, economic diversification, macroeconomic stabilization, credibility, and "fear-offloating" type effects-that have been identified in the literature as key potential determinants of regime choice. To illustrate, the template is applied to Kazakhstan and Pakistan. The results indicate a fairly strong case against a pegged regime in Pakistan. The implications for Kazakhstan are mixed, although changes in that economy in recent years strengthen the case against a peg.

Taxonomy

Economic policy , Foreign exchange , Monetary policy




More publications in this series: Working Papers


More publications by: Aasim M. Husain